By: Leslie McNamara
Sen. Bernie Sanders’ presidential campaign is gaining steam against the presumed Democratic nominee, Hillary Clinton, because of his populist message that appeals to the more liberal arm of the Democratic Party. Sanders’ Medicare for All proposal embodies his brand of populism: a single-payer health care system that provides universal health care without insurance companies, copays or deductibles. However, there are serious obstacles to enacting and implementing a single-payer health care system.
First, a single-payer model will face fierce opposition from the suppliers of the medical industry, particularly insurance companies and physicians. Historically, physicians represented by the American Medical Association, fearing financial impact and the loss of professional autonomy, have long opposed health care legislation that could lead to national health insurance. This opposition led the Roosevelt administration to avoid seeking national health insurance and later helped defeat Truman’s national health care program. Thus, it is hardly surprising that the AMA opposed the public option. Insurer opposition to a single-payer health care system stems from a position of self-interest. Insurers recognize health care reform could lead to government-managed health care, threatening their authority in the delivery and financing of health care.
Sanders argues that the financial influence of insurance companies in Washington explains the problem of instituting health care reform. While it is certainly true that the insurance companies represented by America’s Health Insurance Plans lobby Washington to influence health care legislation. However, the problem in instituting health care reform is not because of “money in politics,” but rather the problem of path dependency.
Path dependency is the concept that once an institution is in place, it develops and it becomes difficult to reverse course. As political scientist John Kingdon has argued, initial conditions and early choices, random or not, significantly affect the future course of events. Thus, early public policies affect future public policies, and once a policy direction is established, it is difficult to undo what already exists. Medicare and Medicaid permitted insurance companies to be responsible for the delivery and financing of health care. This policy decision set a precedent for the American health care system and the future of health care reform. This explains the difficulty in wrestling health care delivery from insurance companies, and the problems inherent in the Affordable Care Act. By relying on insurers to expand health care coverage, the ACA acknowledges political reality and further empowers the insurers.
While a single-payer model is infeasible, alternatives do exist that could succeed in transferring control from insurers to physicians. The public option should be explored again given the ideal political climate. Policymakers should continue to monitor the success of the ACA’s experimental delivery and payment models.
Prepaid physician groups might offer another approach. Early in the 20th century, physicians practiced in multispecialty groups, which controlled costs and delivered high-quality care. Physicians were paid a combination of a salary and a portion of the profits of the health plan. Historian Christy Ford Chapin has shown that this model correctly incentivized physicians by tying their financial interests directly to the health plan. Thus, physicians, not insurers, were responsible for the delivery and financing of health care. It would be beneficial to explore the strengths and drawbacks of this delivery system as well. But no matter how some Americans may long for a simple, single-payer system, the historic opposition from medical professionals and the economic and political power of the insurance industry will, at least for the near term, doom any attempt to impose such an approach to health care delivery.
Leslie McNamara is a public policy graduate student specializing in health policy. She can be reached at lamcnamar@gmail.com.
