In 1945, a majority (59%) of all Americans approved of single-payer health care and California was one vote away from enacting it statewide. By 1950, approval for single-payer dropped down to 24%. What happened?
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Universal health coverage has been a progressive ideal for over a century. Despite the progress made, it’s still considered the most important issue amongst Democratic primary voters in 2020. Moreover, 7 of 10 Americans believe our health care system is either “in a state of crisis” or “has major problems.”
Anecdotal stories abound. Like the couple who was charged $10k for their daughter who died within 30 minutes of birth…Because they didn’t add their dying child to their health insurance policy in time. Or the lady who went to an in-network hospital but was charged $60k for her appendectomy since her surgeon was out-of-network. (This happens to 42% of all Americans who visit an in-network hospital.)
Besides the anecdotal stories, the overall data paints a stark picture as well. Every year, over half a million Americans declare bankruptcy due to medical bills. In fact, almost half of all cancer patients, including those with health insurance, deplete all their life savings within 2 years of diagnosis and more than half of them accrue more than $10k in debt. 137 million Americans are in debt due to high medical bills, 27 million are uninsured, and almost 70k die each year due to lack of health insurance. And yet we spend twice as much per person as every other developed nation on earth, but we are neither twice as healthy nor do we live twice as long.
As a result, the issue of single-payer healthcare, or “Medicare for All”, has entered our national dialogue as a potential solution…for the second time.
What is Single-Payer Health care?
Though not the only option, single-payer is the most well-known path to universal health coverage amongst progressives.
In our current health care system, Americans go see the doctor and the insurance company is the “payer” of the medical bill. Since we have multiple insurance companies, we have “multiple payers.”
In a single-payer system, the government takes over the role of the insurance company and becomes the “single payer” of the bill.
In the current system, insurance companies collect premiums to pay for medical bills. In a single-payer system, the government collects taxes to pay for medical bills.
What Single-Payer is Not
Single-payer is not “socialized medicine”, another path to universal health coverage, which is implemented in the United Kingdom.
Under both single-payer and socialized medicine, the government foots the bill. Except in socialized medicine, the government also owns the hospitals and employs the doctors. In single-payer, the government merely takes on the role of the insurance company.
The 3 Benefits of Single-Payer:
Simplicity, Saving Money, and Saving Lives
Implementing single-payer would yield 3 benefits: Simplicity, Saving Money, and Saving Lives
Simplicity
It’s nice to have choices. As in it’s nice to choose between a hamburger, cheeseburger, or a Double-Double at In-N-Out.
But it would be overwhelming to choose between over 900 different types of burgers, most of which probably don’t taste good. Besides, it wouldn’t be cost efficient for In-N-Out either. Keeping fresh ingredients on hand for all 900 burgers would be a nightmare, and training employees to cook all of them would guarantee that In-N-Out would never benefit from economies of scale.
We currently have over 900 health insurance companies, each with their own rules and regulations. Some collect premiums and require deductibles while others require co-pays. Some insurance companies cover all medical services without preconditions. Others require the customers to provide 3 years of medical records.
This creates confusion. No surprise up to 1 out of 5 health claims are denied.
But it’s not just confusing for consumers. Doctors get confused as well.
Due to all the loopholes and technicalities in each insurance company, American family doctors are not paid for up to 30% of their services. In comparison, this only happens to family doctors 2% of the time in Canada, which switched to single-payer in 1968.
Under a single-payer system, the 900 health insurance companies will be consolidated into one; instead of having 900 different sets of rules to play by, there would only be one set of rules.
Saving Money
Implementing a single-payer system would save anywhere from $200 billion (according to a conservative think tank funded by the Koch brothers) to $450 billion (according to Yale) every single year.
Decreased administrative costs (currently $812 billion per year) and lower prices for pharmaceutical drugs (currently $480 billion per year) contribute to these savings.
Administrative costs would no longer be $812 billion annually since they would no longer be duplicated across multiple health insurance companies. Under the current system, our more than 900 health insurance companies have their own CEOs, accounting departments, and sales teams to name a few examples. Under a single-payer system, all of this administrative work would be consolidated under one roof and we would benefit from economies of scale.
This is why health care administration cost per person is more than 4 times higher in the United States than it is in Canada.
As for pharmaceutical drugs, a single-payer system allows the government to negotiate lower prices on behalf of its citizens. This is why the price of insulin is 10 times higher in the US than in Canada. Per capita, Americans spend 2 times more than the rest of the world on drugs.
Saving Lives
The simplicity of single-payer leads to cost savings, and with the cost savings we can now afford to cover all Americans, including the 28 million who currently don’t have any coverage.
According to the Yale study referenced earlier, this increased access would save almost 70,000 lives annually.
But we have tangible evidence of this happening already:
Four years after implementing universal health coverage for its residents, Massachusetts saw a 3% decrease in death rate.
A 3% reduction of the 2.8 million deaths every year in the US would save 84,000 lives annually.
The 3 Economic Benefits of Single-Payer:
Increase Pay, Improve Labor Market, Inspire Entrepreneurship
Implementing single-payer would (3 I’s): Increase Pay for workers, Improve the Labor Market, and Inspire Entrepreneurship.
Increase Pay
Multiple studies have shown that in the private sector, an increase in health care costs results in a decrease in pay, dollar for dollar.
The evidence is mixed for public sector jobs, which tend to be unionized and don’t have the same market forces (employers competing for good employees).
But will a decrease in health care costs really result in a pay increase, dollar for dollar? Wouldn’t those “greedy corporations” just keep that money for their shareholders?
Let’s be clear: you’re not getting a pay raise from your employer the day after single-payer passes. But once all employers start experiencing cost savings, they will have more money to compete for better employees.
This is exactly what happened, in reverse, in 1942.
With so many eligible Americans fighting in World War 2 overseas, employers were facing a severe labor shortage. Economists were afraid that employers would compete for eligible workers by raising wages higher and higher, and that this would lead to inflation. This is why President Franklin Delano Roosevelt (FDR) froze wages with an executive order in 1942.
But the labor shortage was still there. And so was the desire to compete for eligible employees.
After FDR’s wage freeze, employers began to compete for talent by offering better and better health insurance as a benefit.
Imagine if single-payer had already been in place and FDR did not freeze wages in 1942. Natural market forces would have increased compensation for American workers.
Improve Labor Market
As mentioned above, single-payer will reduce duplicated administrative costs. Meaning 1.8 million Americans in health care administration will lose their jobs.
But…
Increased health care access for 28 million uninsured Americans will increase demand for doctors, nurses, and other health care workers. This will create at least 2.3 million new jobs in the health care sector.
To put things in perspective, 22 million Americans were laid off in 2018 alone. And proper legislation can make things fair for the 1.8 million displaced workers (unemployment benefits and job-training for example).
It would not have made sense to outlaw Netflix to protect Blockbuster jobs. Likewise, it would not make sense to argue against single-payer based on these 1.8 million jobs.
In addition, many progressives would argue that there would be less “job lock,” in which people feel “locked in” to their jobs simply because they don’t want to lose their current health insurance.
Only 30% of Americans are “actively engaged” at work, meaning they are committed to their organization’s goals and likely to be making positive contributions. That means 70% of American employees lack motivation, are unproductive at work, and are a liability to the company. It makes sense that detaching employment from health insurance would allow Americans to find better matching jobs.
Along the same lines, countries with universal healthcare should have much higher employee engagement rates.
Turns out this is not the case. Here are some of the employee engagement rates from other countries:
United Kingdom 17%
Canada 16%
Italy 14%
In reality the United States has one of the highest employee engagement rates in the world. Meaning while implementing single-payer could improve employee engagement over current levels, it’s not the main driver.
Inspire Entrepreneurship
Running a small business is already daunting. Having to pay for the most expensive health care in the world makes it more daunting. No doubt this contributes to the US having the lowest self-employment rate (6%) in the developed world. On the flip side, all of the countries with the highest self-employment rates have some form of universal health care.
As of 2018, the US has the lowest self-employment rate in the developed world (OECD Data)
Of course healthcare is not the only factor that contributes to low self-employment. Canada’s rate at 8% is only slightly better than the US. There are other factors such as our national obsession with retirement or the need to have a stable paycheck…in order to be creditworthy enough to go into lifelong debt for that big, beautiful house to sleep in at night. And speaking of debt, our massive student loans probably play a role in discouraging entrepreneurship as well.
Either way, having to pay an average of $2k per month for health care for a family of four is a barrier of entry for aspiring entrepreneurs. Single-payer would remove this barrier.
At the very least, we would not rank dead last in self-employment.
Medicare is Single-Payer
Our current Medicare system, which is available to Americans 65 or older, is run using the single-payer model. This is why single-payer is often called “Medicare for All”. Many single-payer proponents propose gradually lowering the age of Medicare eligibility until Medicare covers all Americans. But before doing so, we need to address some of the underlying issues in the current Medicare system.
The 3 Problems of Medicare:
Poor, Paperwork, Payments
Of course Medicare is not a perfect system. There are 3 problem P’s with Medicare: it’s Poor and it increases Paperwork/lowers Payments for doctors.
Poor
Medicare does not cover everything. Original Medicare, for example, does not cover pharmaceutical drugs, dental care, nor vision. Also it does not protect patients from high out of pocket costs like deductibles and co-pays. This is why 80% of Medicare enrollees have some sort of supplemental insurance.
And even though Medicare does not cover all health related costs, its funds are still set to deplete by 2026.
This is because when Medicare was passed in 1965, the average lifespan was 70 years. In 2020 it is 79 years. In other words, Medicare used to cover the last 5 years of someone’s life. Now it covers the last 14 years.
This does not mean we cannot afford Medicare for all, but it does mean that taxes will be increased, even if we gradually lower the age of eligibility.
More Paperwork and Lower Payments for Doctors
Doctors need to fill out more paperwork for their Medicare patients than they do for their private insurance patients. In fact, doctors spend at least as much time filling out paperwork for their Medicare patients as they do spending time with them face to face; many boxes must be checked and plenty of documentation must be provided. One mistake can lead to a months-long delay in reimbursement. And while there are doctors who legitimately commit Medicare fraud, all doctors risk heavy fines and/or jail time for honest mistakes too.
And what do doctors get in return for dealing with more paperwork? Less pay. On average, Medicare pays doctors 80% of what private insurers do.
This is why almost 1/3 of doctors now refuse to take new Medicare patients.
Again, this does not mean we cannot implement Medicare for All (M4A). But it does mean that implementing M4A is more complicated than simply lowering the eligibility age for Medicare.
Medicare is popular
While our current Medicare system may have its flaws, Medicare users are still more satisfied than private health insurance users by over 9%, and 20% more satisfied with its costs. Single-payer is often called “Medicare for All” in order to take advantage of this popular sentiment.
And in fact, “the original idea behind Medicare was Medicare for All,” says Professor Jonathan Oberlander, chair of social medicine at University of North Carolina Chapel Hill. The creators of Medicare had hoped that future lawmakers would incrementally expand it until it became universal health care.
Medicare is more popular than our private system and we’ve had 55 years to make Medicare for All a reality.
So why don’t we have single-payer yet?
And more importantly, why didn’t the creators of Medicare just push for Medicare for All to begin with?
In order to answer these questions, we need to go back to the 1940s, when public support for single-payer dropped from 59% to 24%.
What happened?
1945: Governor Earl Warren’s Attempt at Single-Payer for California
In 1945, California had a Republican governor named Earl Warren. He was very popular and had presidential ambitions. In fact, he would later be picked as the Republican Party’s Vice-Presidential nominee in 1948. Of course we’ll never know, but a successful single-payer model in California could have led to a successful single-payer model nationwide. (Case in point: Obamacare grew out of Romneycare)
Due to the popularity of single-payer health care amongst Americans, Governor Warren proposed to set it up for all Californians. With less than 4% of our GDP spent on health care during this time, California’s single-payer would have been funded by a 3% payroll tax: 1.5% from the employee and 1.5% from the employer.
But the California Medical Association (CMA) was vehemently opposed to this proposal and hired Campaigns Inc., the world’s first political consulting firm, to destroy single-payer.
Whitaker & Baxter: Founders of Campaigns Inc.
(Based on “The Lie Factory” by Jill Lepore)
Founded by a husband and wife duo Whitaker and Baxter (W&B), Campaigns Inc., the world’s first political consulting firm, won 70 out of 75 campaigns by inventing the art of the modern smear campaign.
Here are some of the rules they played by, along with direct quotes in italics. In short, they played into people’s F.E.A.R.S.
Fan the Flames
“We need more partisanship in this country.”
Entertain & Don’t Explain
“The average American doesn’t want to be educated; he doesn’t want to improve his mind; he doesn’t even want to work, consciously, at being a good citizen. But there are two ways you can interest him in a campaign, and only two that we have ever found successful. You can put on a fight, or you can put on a show. So if you can’t fight, put on a show! And if you put on a good show, Mr. and Mrs. America will turn out to see it.”
“The more you have to explain, the more difficult it is to win support.”
Attack, Attack, Attack
“Attack, attack, attack. You cannot wage a defensive campaign and win!”
Repeat, Repeat, Repeat
“We assume we have to get a voter’s attention seven times to make a sale.”
Simplify & don’t be Subtle
“Simplify, simplify, simplify. A wall goes up when you try to make Americans think.”
“Subtlety is your enemy. Words that lean on the mind are no good…they must dent it.”
Prior History
Governor Earl Warren originally hired Campaigns Inc. to help him win the California governor’s race. But he found W&B’s hardball tactics distasteful and fired them just before his election day.
W&B had held a grudge against Governor Warren ever since and were delighted to take on this assignment from the California Medical Association.
Whitaker & Baxter Destroy Governor Warren’s Plan
Governor Warren proposed single-payer for California during the spring of 1945. With World War 2 still going on until the fall of 1945, there was plenty of anti-German sentiment to be taken advantage of.
Consequently, W&B printed and mailed 2.5 million postcards (California’s population was only 9 million at this time) which said the following [emphasis mine]:
Dear Senator:
Please vote against all Compulsory Health Insurance Bills pending before the Legislature. We have enough regimentation in this country now. Certainly we don’t want to be forced to go to “A State doctor,” or to pay for such a doctor whether we use him or not. That system was born in Germany — and is part and parcel of what our boys are fighting overseas. Let’s not adopt it here.
Californians simply signed and mailed these postcards to their state senators.
But that wasn’t all. Knowing full well that single-payer was popular with the American public, W&B were very methodical in their dismantling of it.
First, they wanted to ensure that Californians would have a viable alternative to single-payer. W&B convinced the CMA to significantly expand its privately run health insurance plan, Blue Shield, so that it would be available as one of those options.
Next, W&B reached out to newspaper editors in their network and had them publicize “Voluntary Health Insurance Week,” a drive to increase enrollment in private health insurance. This event was advertised in 400 newspapers and observed in 53 out of the 58 counties in California.
They also lobbied these newspaper editors so that the number of “pro single-payer” newspapers dropped from 50 to 20 while the number of “anti single-payer” newspapers more than quadrupled from 100 to 432.
W&B also prepared more than 3 out of 4 * doctors with prepared anti single-payer speeches, an effective strategy given that Americans have a high level of trust in doctors even to this day.
(* Google does not directly tell us how many doctors there were in California in 1945. But according to the National Health Act of 1945, there was one doctor for every 747 people in California. California population was 9 million at this time. 9 million divided by 747 = 12 thousand doctors in total. Per Jill Lepore, W&B prepared over 9,000 doctors with prepared anti single-payer speeches.)
This was also when W&B coined and popularized the term “socialized medicine,” another effective strategy given that “socialist” was a dirty word in American politics since the early 1900s.
In the words of Jill Lepore herself:
“Whitaker and Baxter took a piece of legislation most people liked and taught them how to hate it.”
But even after all this…
Governor Warren’s single-payer proposal was defeated by one vote.
Yes.
ONE VOTE.
The fact that W&B had to attack Warren’s proposal from all angles in order to squeak out a one-vote victory reveals how popular single-payer was…until people were taught to hate it.
1948: President Harry Truman’s Attempt at Single-Payer for all Americans
“The principal reason why people do not receive the care they need is that they cannot afford to pay for it on an individual basis at the time they need it. This is true not only for needy persons. It is also true for a large proportion of normally self-supporting persons.”
President Harry Truman, 1945
As mentioned before, 59% of Americans approved of single-payer in 1945.
Which is why President Harry Truman proposed it for all Americans in 1945, the same year that Governor Warren did for Californians. But with Republicans winning Congress during the midterm elections of 1946, single-payer legislation did not have a chance to advance.
During his State of the Union speech given in January 1948, his re-election year, President Truman urged the passage of single-payer. In fact, single-payer was one of Truman’s main re-election campaign promises.
On Election Day in November 1948, Truman won the popular vote by 4%, implying that he, and single-payer, had the support of the American public.
Interestingly, the Vice-Presidential running mate of Truman’s Republican opponent was none other than Governor Earl Warren, further demonstrating single-payer’s widespread acceptance even within the Republican party.
In the same way that the California Medical Association organized against Governor Warren during his single-payer attempt, the American Medical Association organized against a newly re-elected President Truman.
In the same way that the California Medical Association hired a political consulting firm to destroy Governor Warren’s single-payer attempt in 1945, the American Medical Association hired…Whitaker and Baxter.
As mentioned before, Governor Warren’s single-payer attempt took place during World War 2 and allowed W&B to take advantage of the prevalent anti-German sentiment. President Truman’s single-payer attempt took place during the McCarthy era, allowing W&B to take advantage of the anti-communist sentiment.
In fact W&B made up — yes, completely pulled out of thin air — a Lenin quote:
“Socialized medicine is the keystone of a socialized state.”
Fake Lenin quote fabricated by Whitaker & Baxter
Never mind that Lenin never said such a thing, the messaging worked.
Working together with W&B, the American Medical Association:
- Spent $53 million in today’s dollars to oppose President Truman’s plan
- Printed over 100 million pieces of anti-single-payer literature (the US population was 146 million at this time)
- Organized parties hosted by doctors’ wives to warn against the evils of socialized medicine
How effective were they?
Given that social media did not exist in the 1940s, opinionated Americans made their voices heard by engaging in an ancient activity now known as “writing letters.” W&B persuaded members of Congress to let them read their constituents’ letters.
In 1948, pro-single-payer letters outnumbered anti-single-payer letters by a factor of 4.5 to 1. Nine months later, anti-single-payer letters outnumbered pro-single-payer letters 4 to 1.
Amongst the general public, support for single-payer dropped from 59% in 1945 to 24% in 1950.
In a span of 4 years, W&B destroyed single-payer both for California and for the United States.
Medicare
The one silver lining to all of this: Medicare, health care for Americans 65 or older, was passed in 1965. Medicare uses the single-payer model, which is why the term “single-payer” and “Medicare for All” (M4A) are used interchangeably.
As mentioned before, the creators of Medicare hoped it would eventually become M4A. But with the Vietnam War (1955–1975) going on, the prevalent anti-communist sentiment would have been difficult to overcome.
“Is there no one else?”
In 1971, Senator Edward “Ted” Kennedy, the popular younger brother of JFK, proposed single-payer and held hearings around the country. But the Vietnam War and Watergate put single-payer on the back burner.
In 1976, Presidential candidate Jimmy Carter promised to enact single-payer, but once elected, President Carter backtracked on this promise. This was the main reason Ted Kennedy ran against Carter during the Democratic primary of 1980.
From 2003 to 2017, Representative John Conyers introduced Medicare for All legislation during each session of Congress.
In 2006, Senator Ted Kennedy also introduced Medicare for All.
But none of these attempts gained any traction.
Bernie Sanders Popularized Medicare for All
In both 2016 and 2020, during his two runs for President, Senator Bernie Sanders made Medicare for All (M4A) his flagship proposal.
It’s odd that Bernie Sanders and M4A gained so much support during the 2016 Democratic primaries, given that Democrats had just spent so much political capital trying to pass and enact the Affordable Care Act (aka “Obamacare”) during Obama’s presidency (2009–2017).
And although more Americans have health insurance thanks to Obamacare, as of 2019, the rate at which Americans declare bankruptcy due to medical bills (half a million every year) has not improved.
Perhaps this is why the idea of government-run health care gained majority support for the first time in 2016; polls show that only 39% of Americans supported this during the early 2000's.
But both of Bernie’s presidential bids ultimately failed. And maybe that’s because support for Medicare for All is mixed.
What the polls say about single-payer
(The following data is based on polls conducted by Kaiser Family Foundation, a nonpartisan health policy institute with no ties to Kaiser Permanente.)
On the surface, 54% of Americans approve of single-payer/M4A according to an April 2020 poll. But a deeper dive reveals that there is a lack of clarity on what single-payer/M4A is.
For instance, 2/3 of M4A supporters mistakenly believe they can keep their current health insurance. This goes against the very definition of “single-payer,” the point of which is to have the government take over the function of the health insurance companies. If the 900 current health insurance companies continue to operate, we would not see the hundreds of billions of dollars of annual cost savings mentioned above.
When it is made clear that private health insurance companies would be eliminated, support drops down to 37%. But support rises again to 54% when respondents are told they can choose their own doctors and hospitals.
In other words, eliminating private insurance does not seem to be an issue as long as Americans are allowed to choose their own doctors.
But support for M4A drops down to 37% when respondents are told their taxes would increase, which is inevitable. When they are informed that the overall health care costs (premiums, deductibles, and copays) will go down and result in a net savings for all Americans, support rises back up to 47%, a slim minority.
Support for M4A drops down to 26% when people are informed that a single-payer system would lead to delays of treatments that are not life-threatening. There will undoubtedly be delays for non-emergency treatments such as hip replacements. In our current system, rich Americans get to have their non-emergency procedures done before poor Americans can get their emergency procedures done.
Under M4A, all Americans, including the poor, would jump to the front of the line in the case of a life-threatening emergency while all Americans, including the wealthy, will be forced to wait longer for non-emergencies.
74% of Americans find this unacceptable.
Finally, amongst Democrats and Democratic-leaning independents, a slim majority of 55% prefer to build on Obamacare while only 40% want to replace Obamacare with M4A.
We can see these numbers play out in the 2020 Democratic primary vote totals as well:
Joe Biden: 43%
+ Bloomberg: 9%
+ Buttigieg: 3%
+ Klobuchar: 2%
= 57% of the total Democratic primary vote
Bernie Sanders: 30%
+ Elizabeth Warren: 9%
= 39% of the total Democratic primary vote
In delegate-rich Texas, Bernie Sanders spent $3.7 million, more than forty times what Joe Biden spent ($89,000) but still lost. Overall, Bernie spent more than triple what Biden spent, but Biden still won the Democratic nomination, demonstrating that Democratic voters are not ready to embrace progressive legislation such as M4A.
What the polls say about public option
On the other hand, support for public option seems to be quite high.
A public option, or “Medicare For All Who Want It” as phrased by Mayor Pete Buttigieg, proposes that we leave the current system in place and have a government run health care system compete against the currently operating private insurance companies. This is what moderate Democrats such as Joe Biden, Pete Buttigieg, and Amy Klobuchar support.
And 82% of Democrats agree. When including Republicans and Independents, 69% of all Americans are in favor of a public option.
Although many progressives oppose a public option (John Oliver calls our current health care system a “sh*t sandwich” and a public option as a “sh*t sandwich with guacamole”), Australia has a public option and its health care system provides one of the best health outcomes in the world.
We could have had public option a long time ago…
A public option was part of President Richard Nixon’s health care proposal in the 1970’s. Along with other reforms, Nixon suggested that Americans would have the option of buying into a federal program like Medicaid (government run health insurance for those living in poverty).
In other words, about 50 years before Pete Buttigieg proposed “Medicare For All Who Want It”, President Nixon proposed “Medicaid For All Who Want It”.
Would have been nice to have a public option in the 1970’s, but President Nixon was impeached and the effort ended.
And so we tried again in 2009.
In 2009, Obamacare passed through the House of Representatives with a public option. And though a public option could have been implemented along with Obamacare in 2012, that did not happen. Senator Joe Lieberman, (Vice Presidential running mate to Al Gore in 2000), threatened to filibuster the bill if the public option was not removed from the bill before reaching the Senate floor. Lieberman received about $3 million in campaign contributions from insurance companies, pharmaceutical companies, and health professionals during his time as Connecticut’s senator. The passage of a public option threatens private insurance companies’ profits in the long run, since they would have to compete with a lower cost program.
As a result, Obamacare passed through the Senate without a public option.
The path forward for single-payer?
Both Bernie Sanders and Elizabeth Warren (the two proponents of single-payer health care during the 2020 Democratic primary) failed to secure the Democratic nomination. Whether Joe Biden or Donald Trump wins in November 2020, national single-payer won’t be passed until 2025 at the earliest.
In the meanwhile, implementing statewide single-payer is the only option.
In the same way that Romneycare became Obamacare, single-payer proponents hope that a successful implementation of statewide single-payer can lead to a national single-payer system.
Vermont’s Single Payer Attempt
In November 2010, Vermont elected Democratic Governor Peter Shumlin, who ran on the promise of enacting the nation’s first statewide single-payer system.
This was a particularly bold move given that Obamacare had just passed a few months before that May. Passing Obamacare drained President Obama’s political capital, and the Democrats lost control of the House of Representatives and 7 seats in the Senate as a result during the 2010 midterm elections.
So while most Democrats across the country breathed a sigh of relief that any health care legislation had passed at all, Shumlin declared that Obamacare did not go far enough, and that Vermont needed to enact statewide single-payer.
And he won.
Not surprising given that Bernie Sanders, self described “Democratic Socialist”, has represented Vermont as both a Representative and Senator since 1991.
In May 2011, six months after Governor Shumlin’s victory, Vermont passed legislation guaranteeing health coverage to all of its residents. This gave Shumlin the green light to make good on his single-payer promise. Now all he had to do was to figure out how to pay for and implement it.
But that was where it fell apart.
Vermont is unique. Because it is such a small state, many people commute into Vermont from out of state and vice versa. There are also companies with operations across multiple states, including Vermont.
These factors added a layer of complexity to Governor Shumlin’s funding scheme, which relied on payroll taxes from businesses. Vermont business owners advised Shumlin to include their out of state commuters into his single-payer plan in order to avoid the headache of having to deal with two different health insurance policies within one company. And of course, Vermonters who worked for out of state companies needed to be included as well.
With all these complexities in mind, Governor Shumlin’s administration consulted economists and experts to crunch the numbers and to come out with a plan. After 3 and 1/2 years of deliberations, the group concluded that payroll taxes would need to be raised by 11.5% and income taxes by 9.5% in order to move forward with the plan.
(Keep in mind: when California Governor Warren proposed a 3% payroll tax to fund single-payer in California, health care spending was less than 4% of our GDP. When Governor Shumlin proposed his 11.5% + 9.5% = 21% tax increase, health care spending was almost 18% of GDP.)
In December of 2014, Governor Shumlin conceded that Vermont was not ready to enact single-payer.
Upfront Costs
Even if savings are projected in the long run, any government run health care program will require upfront costs in the form of increased taxes. This is why single-payer did not pass in Vermont. This is also why Oregon did not to enact a statewide public option in 2010.
Any state that implements a government run health insurance needs to have deep pockets. Which brings us back to square one: California.
Back to Square One: California
In 2018, California elected Governor Gavin Newsom, who also promised to enact statewide single-payer. In 2007, as the mayor of San Francisco, Newsom implemented “Healthy San Francisco,” city-wide universal health care which provides care to all of its residents, including the undocumented and homeless populations.
Governor Newsom has assembled a single-payer commission of health care experts and economists to map out the funding and implementation steps for California. As of this writing, the commission’s proposal for next steps is due on February 2021.
In the meanwhile, California Representative Ro Khanna has introduced the “State-Based Universal Health Care Act” in Congress. Currently, federal programs like Medicare, Medicaid, and Children’s Health Insurance Program already spend money on California residents enrolled in these programs. Representative Khanna’s bill would allow states to receive these funds as a lump payment of cash instead, which can then be used to fund statewide universal health care.
Canada and the Future
Canada used to have a health care system much like ours today. But that all changed in the 1960’s when it implemented single-payer.
In 1944, the province of Saskatchewan elected Democratic Socialist Tommy Douglas as its Premier. With Saskatchewan’s population being roughly 10% of the total Canadian population, similar to California’s population in relation to the United States, being Premier of Saskatchewan is roughly equivalent to being governor of California.
As the first Democratic Socialist elected to an office in North America, Premier Douglas enacted progressive legislation including free hospital care for all of Saskatchewan’s residents. And although hospital care was free, Canadian doctors continued to bill their patients separately.
In 1960, as he ran for his 5th term, Douglas promised to enact single-payer for Saskatchewan and predicted that the other provinces would follow.
He won. And he was right.
Of course, the Canadian Medical Association denounced the plan as “socialist”. It sent out pamphlets and printed newspaper ads warning “political medicine means red tape, high costs, and inferior medical care.”
Regardless, single-payer launched in Saskatchewan in July 1962. Doctors went on strike and people showed up at protests with effigies of Douglas hanging from a noose. The strike lasted for a total of 23 days, and doctors had to be flown in from the United States and England in order to keep the emergency rooms running.
But eventually, both the doctors and the government came to an agreement: doctors would be independent contractors, not government employees.
After Saskatchewan’s success, the other Canadian provinces followed suit, and within 10 years, all of Canada had implemented a single-payer system for its citizens.
Are Canadians happy with their health care system? Probably.
In 2004, Tommy Douglas was voted “The Greatest Canadian of All Time”.
But are the Canadian doctors happy with the health care system? Probably.
In 2018, over 500 Canadian doctors signed a public letter protesting the fact that…they were being paid too much. After all, family doctors in Canada get paid anywhere from $20k to $100k more per year than their counterparts do in the United States. (This is not the case for specialists.)
In addition, the simplicity of a single-payer system allows Canadian doctors to practice medicine without worrying about the bureaucracy that pays for health care. As mentioned above, the complexities of the more than 900 insurance companies mean that American family doctors are not paid up to 30% of the time. In the meanwhile, this only happens to their Canadian counterparts 2% of the time.
This is probably why a growing number of American doctors are moving to Canada. And although Canadian doctors used to emigrate to the US for economic opportunity, starting in 2005, the number of doctors moving back to Canada has outnumbered the doctors leaving Canada.
Conclusion
Despite its many advantages and its popularity in the 1940s, we were unable to pass single-payer due to vested interests. The American Medical Association stopped single-payer in the same way the California Medical Association did and the Canadian Medical Association attempted to. Even a public option, the more moderate approach, was shut down in 2009 due to the lobbying efforts of health insurance and pharmaceutical industries.
And these vested interests know how to play to our fears. Although Whitaker & Baxter left the political consulting industry in 1958, the principles that made them so successful are still in play today. Fear mongering, constant attack ads, opposition research, repeating false things until they are accepted as truths, and fanning the flames of partisanship continue to echo in our political discourse.
No doubt, any sort of progress we try to make on health care will be met with this sort of resistance. Even in 2009, Obamacare’s public option was denounced as “socialist” by Michael Steele, chairman of the Republican National Committee. And conservative talk show hosts falsely accused Obamacare of having “death panels,” which Politifact rated as the “Lie of the Year”.
But Republicans are not the only ones resisting progress on health care. Less than a month after Democrats took back control of the House in November 2018, Nancy Pelosi’s top aide sat down with health insurance executives and promised them not to worry about Democrats pushing for M4A. And health insurance stocks surged after Joe Biden beat Bernie Sanders on Super Tuesday due to Biden’s promise not to implement M4A.
Which puts the onus back on the American people. Why is Nancy Pelosi the Speaker of the House? And why did Joe Biden win the 2020 Democratic nomination? They are merely reflecting the will of their constituents. As the polling shows, support for M4A is unclear, and the majority of Democrats seem to stand with Biden’s more moderate approach.
So on a national level, we can push for a public option once again while single-payer is back on the table on a statewide level.
But neither of those changes will come without resistance from vested interests. In the same way Americans flipped in their support for single-payer within the span of 5 years, public opinion on the public option can flip too.
Ultimately it is up to us to be informed and to inform our neighbors of these forces at play. Just like protecting ourselves from negotiation gambits being used to disadvantage us — we must recognize it, and call it out. When the fear mongering and the repetition of false information ramp up, it’s our job to point out that these fears are being incited in us by forces that stand to benefit from the status quo — forces that have actively opposed single payer since the 1940s.
If we want progress, we cannot allow the chicanery to go uncontested. That’s why having this awareness, and spreading it, is critical. These entrenched interests may have vast resources on hand, but if we can contest their deceit with enough social support, we can win.
It’s about time we did.
Until next time, let’s keep our eyes open and keep going for woke.
