For decades, the members of AFT-Oregon have been clear about their desire to implement a single-payer healthcare system in America. So what is single-payer? And how does it work? Here are some answers from our friends and allies at Healthcare for All Oregon and Physicians for a National Health Program. Want to get involved? Contact HCAO.
What is single-payer healthcare?
Single-payer national health insurance is a system in which a single public or quasi-public agency organizes health financing, but delivery of care remains largely private.
Currently, the U.S. health care system is outrageously expensive, yet inadequate. Despite spending more than twice as much as the rest of the industrialized nations ($8,160 per capita), the United States performs poorly in comparison on major health indicators such as life expectancy, infant mortality and immunization rates. Moreover, the other advanced nations provide comprehensive coverage to their entire populations, while the U.S. leaves 51 million completely uninsured and millions more inadequately covered.
The reason we spend more and get less than the rest of the world is because we have a patchwork system of for-profit payers. Private insurers necessarily waste health dollars on things that have nothing to do with care: overhead, underwriting, billing, sales and marketing departments as well as huge profits and exorbitant executive pay. Doctors and hospitals must maintain costly administrative staffs to deal with the bureaucracy. As a result, administration consumes one-third (31 percent) of Americans’ health dollars, most of which is waste.
Single-payer financing is the only way to recapture this wasted money. The potential savings on paperwork, more than $400 billion per year, are enough to provide comprehensive coverage to everyone without paying any more than we already do.
Under a single-payer system, all Americans would be covered for all medically necessary services, including: doctor, hospital, preventive, long-term care, mental health, reproductive health care, dental, vision, prescription drug and medical supply costs. Patients would no longer face financial barriers to care such as co-pays and deductibles, and would regain free choice of doctor and hospital. Doctors would regain autonomy over patient care.
Physicians would be paid fee-for-service according to a negotiated formulary or receive salary from a hospital or nonprofit HMO / group practice. Hospitals would receive a global budget for operating expenses. Health facilities and expensive equipment purchases would be managed by regional health planning boards.
A single-payer system would be financed by eliminating private insurers and recapturing their administrative waste. Modest new taxes, based on ability to pay, would replace premiums and out-of-pocket payments currently paid by individuals and business. Costs would be controlled through negotiated fees, global budgeting and bulk purchasing.
What are the primary features of single-payer healthcare?
- Universal, Comprehensive Coverage - Only such coverage ensures access, avoids a two-class system, and minimizes expense
- No out-of-pocket payments - Co-payments and deductibles are barriers to access, administratively unwieldy, and unnecessary for cost containment
- A single insurance plan in each region, administered by a public or quasi-public agency - A fragmentary payment system that entrusts private firms with administration ensures the waste of billions of dollars on useless paper pushing and profits. Private insurance duplicating public coverage fosters two-class care and drives up costs; such duplication should be prohibited
- Global operating budgets for hospitals, nursing homes, allowed group and staff model HMOs and other providers with separate allocation of capital funds - Billing on a per-patient basis creates unnecessary administrative complexity and expense. A budget separate from operating expenses will be allowed for capital improvements
- Free Choice of Providers - Patients should be free to seek care from any licensed health care provider, without financial incentives or penalties
- Public Accountability, Not Corporate Dictates - The public has an absolute right to democratically set overall health policies and priorities, but medical decisions must be made by patients and providers rather than dictated from afar. Market mechanisms principally empower employers and insurance bureaucrats pursuing narrow financial interests
- Ban on For-Profit Health Care Providers - Profit seeking inevitably distorts care and diverts resources from patients to investors
- Protection of the rights of health care and insurance workers - A single-payer national health program would eliminate the jobs of hundreds of thousands of people who currently perform billing, advertising, eligibility determination, and other superfluous tasks. These workers must be guaranteed retraining and placement in meaningful jobs.
from the American Journal of Public Health January 2003, Vol 93, No.1