On average, only 2 percent of the revenues that flow through Medicare are needed to cover overhead costs. In contrast, patients who subscribe to private health insurance spend 14 percent of their money — seven times more — just paying for the overhead costs doctors incur from juggling the multitude of insurance procedures required for different patients subscribing to insurance plans.
Other commenters, such as Dr. Dave Dvorak, writing in the April 2013 issue of Minnesota Medicine , put the cost of Obamacare even higher, arguing that “a staggering 31 percent of U.S. health care spending goes toward administrative costs, rather than care itself.” As Dr. Dvorak notes, while “Obamacare … is expected to extend coverage to 32 million more Americans,” it does this by “expanding the current fragmented, inefficient system” and will likely “do little to rein in health care spending.”
In contrast, the U.S. government itself agrees that the ACA — the system we’ve settled upon instead of offering Medicare-for-all — costs more than a move to a cheaper, more efficient, and better single-payer system. The U.S. Government Accountability Office calculates that a switch to single-payer would shave $400 billion a year off the national health care bill.
Little wonder, then, that a 2008 survey published in the Annals of Internal Medicine found that 59 percent of physicians polled support Medicare-for-all.
A government takeover?
So Medicare-for-all is cheaper, more efficient, and better than Obamacare — but isn’t it a “government takeover” of health care?
It needn’t be.
If an individual consumer thinks he’s better off with a private health insurance plan from WellPoint, Inc. (NYSE:WLP) — or from UnitedHealth Group Inc. (NYSE:UNH), Aetna Inc (NYSE:AET), or CIGNA Corporation (NYSE:CI) — then fine. They could still sign up for one of those, either as a supplement to Medicare-for-all or, if they prefer, as an exclusive plan, and choose not to participate in Medicare at all. For that matter, there should be no need to require anyoneto buy any insurance whatsoever.
All that’s really required for Americans to begin reaping the 73 percent savings of a Medicare-for-all plan is to open up Medicare enrollment to everybody. Give everyone the right to sign up for Medicare, rather than requiring us all to sign up for a private insurance plan under the ACA. And then let the marketplace decide if Medicare-for-all is really as good an idea as NerdWallet’s survey makes it sound.
The article How Much Could Medicare for All Save You? originally appeared on Fool.com is written by Rich Smith.
Fool contributor Rich Smith has no position in any stocks mentioned. The Motley Fool recommends UnitedHealth Group and WellPoint. The Motley Fool owns shares of WellPoint.
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