Medicare-for-all is cheaper

Canadians pay less in health-care taxes than Americans. And Canadians get single-payer.

Bernie Sanders.
(Image credit: Illustrated | AlexRaths/iStock, Maddie McGarvey/Getty Images for, shironosov/iStock)

If Bernie Sanders had his way, you'd probably spend a lot less money on health care.

The Koch-funded Mercatus Center provided accidental support for Sanders' Medicare-for-all plan recently when it published a paper demonstrating that America as a whole would save over $2 trillion in spending over 10 years by passing such a program. Yes, there would be a gigantic increase in federal spending, but it would be more than compensated by lower prices and administrative costs. For individuals, as a RAND study of a proposed New York state single-payer plan shows, taxes would go up dramatically, but premiums, deductibles, and co-pays would be zeroed out, leaving most people with more money on net.

This is because the American health-care system is staggeringly wasteful. One shocking way of visualizing this is by noting we already spend more tax money on it per person than most peer nations — and then on top of that, a whole bunch more private money. If we transplanted Canada's single-payer system into America, for example, the required tax revenue would actually go down.

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When I made this observation on Twitter, conservatives (including several prominent commentators) spent the next several days scoffing at the idea, trying to disprove it with wildly inaccurate statistics or just straight-up refusing to understand the point being made. It's a good demonstration of the utter uselessness of conservative ideology when it comes to health care.

First, let's actually look at the numbers. In 2016, Canada's single-payer system cost about $4,500 per person. The Centers for Medicare and Medicaid Services say that same year, just directly tax-supported health-care programs — Medicare, Medicaid, Veterans Affairs health programs, and the Children's Health Care Program — cost together $1.929 trillion, or $5,972 per person. Add in the cost of the employer-based insurance tax exclusion ($268 billion) and ObamaCare tax subsidies ($48 billion), both figures courtesy of the Congressional Budget Office, and total government spending on health care rises to $2.245 trillion, or $6,950 per person.

So not only does our government health spending easily exceed that of Canada, it's not even close. And that's still leaving some stuff out!

When making these sorts of comparisons, it's important to understand what manner of point is being made. Obviously it would be nearly impossible to literally copy-paste one country's institutions into another — there are all manner of huge changes to payment systems, provider networks, and prices that would have to happen, and it would be immensely disruptive to just cram it through overnight. (That is why Sanders' Medicare-for-all bill would be considerably more generous than the Canadian system, and take effect over a number of years.)

Instead, the point is about the overall efficiency and expense of a national system. If Canada — or Sweden, or Austria, or Denmark, or France, or Australia, or Finland — can cover everyone in a government program for less tax money than America is already paying, then that's a reasonable rough indicator of what we ought to be able to get if we really put our minds to it.

That is doubly true because there is no sign whatsoever that we are actually getting anything good for all that extra spending. On the contrary, American health outcomes are middling-to-poor on most indicators. Compared to peer nations, we do decently well at cancer mortality and treating heart attacks and strokes, but we have the worst life expectancy, the highest rate of death from preventable illness, the highest rate of disability, and the highest rate of medical errors. And contrary to conservative carping about rationing, we even have the second-highest rate of wait times over six weeks to see a doctor. (Canada is actually worst on this last metric, another reason you wouldn't simply copy-paste their system.)

Additionally, the U.S. system places on Americans a nightmarish burden of stress, complexity, and fear. Citizens of nations with universal care aren't sent into an immediate panic when they are injured or fall very sick, terrified of being whacked with a $2,400 bill for a two-mile ambulance ride. After they get treatment they don't have to wade through a Byzantine pricing labyrinth or take on a second job as an amateur claims adjuster waging a multi-front war against their insurance company and the medical provider over a wildly inflated bill. Nobody goes bankrupt from medical debt.

But conservatives refuse to see the obvious fact that American health care sucks and following the lead of virtually any other peer nation in putting through some sort of government-funded system would be a vast improvement. They refuse to concede the obvious point that, unlike home or car insurance, the private market fails at health insurance because sick or poor people require systematic transfers when the cost of care outstrips their income — indeed, this reality infuriates conservative ideologues like Paul Ryan.

If we want to create a workable health-care system, it's best to simply ignore conservative ideology and trust in tried-and-tested Big Government.

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