Despite the 2010 healthcare overhaul, millions of Americans still don’t have health insurance. Millions more Americans, especially young people, are stuck with bad and expensive plans that charge outrageous deductibles and copays.
The U.S. spends more on healthcare per person, and as a percentage of our economy, than any other advanced nation in the world. Unfortunately, all that additional spending hasn’t even made Americans healthier than the rest of the world. To put it bluntly: We spend far more and end up with less.
However, the current Medicare system is the most cost-effective, efficient, and popular medical payment system in the country. Due to legislative compromises made decades ago, Medicare benefits are currently only available to Americans over the age of 65. It’s time we open up this successful and cost effective program to all US citizens. My Americare plan does this in three different tiers.
We also need to focus on training more doctors and nurses. We need to ensure a strong healthcare workforce, and build on the strength of the 50 years of success of the Medicare program. Any attempt at healthcare reform must significantly reduce overhead, administrative costs, and system complexity.
We need a system where all people can easily get the care they need to maintain and improve their health regardless of income or age. Under this Americare plan, Americans will benefit from the freedom and security that comes with finally separating health insurance from employment.
Americare would help us live happier, healthier and more fulfilling lives, and promote innovation and entrepreneurship in every sector of the economy. Americans would enjoy a newfound freedom to start new businesses, stay home with their children, or leave jobs they don’t like, by knowing that they would still have healthcare coverage for themselves and their families.
Employers will save thousands of dollars per employee, and would be free to focus on running their business instead of wasting countless hours on insurance paperwork.
Working Americans wouldn’t have to choose between bargaining for higher wages or better health insurance. Parents wouldn’t have to worry about how to provide health insurance to their children. Seniors and people with serious or chronic illnesses wouldn’t be forced to split pills or leave prescriptions unfilled.
Millions of people will no longer have to choose between healthcare and other necessities like food, heat and shelter, and will have access to necessary services that may have been out of reach, like dental, mental, or long-term care.
Simply put, our Americare plan will provide all of us with the sense of freedom and peace of mind that comes from knowing we’ll always have access to the healthcare we need.
My Americare plan eliminates the age restriction, and creates three new tiers of Medicare eligibility, collectively called Medicare Part E. This plan will include comprehensive coverage including:
- All primary care, and many specialties
- Inpatient and outpatient care
- Preventive and emergency care
- Long-term and palliative care
- Vision, hearing and oral care
- Mental health and substance abuse services; and
- Prescription medications, medical equipment, supplies, diagnostics, and treatments
Patients will be able to choose a healthcare provider without worrying about whether that provider is in-network and will be able to get the care they need without having to read any fine print or trying to figure out how they can afford the out-of-pocket costs.
Without affecting any current Medicare enrollees, Medicare Part E allows American citizens the option of buying into Medicare Parts A, B,and D together or separately. Eligibility will be offered in three different tiers:
Tier 1- Expand Medicare to all veterans. Veterans currently eligible for VA Benefits may join the Medicare system at no cost to them. They will be automatically sent a Medicare card. They will pay no premiums, deductibles, or copayments. This will not affect their current VA benefits in any way. For non-combat related health issues, this might be an easier way for veterans to get their basic health problems taken care of. So not only is this a way to supplement the benefits that veterans currently get, but it will also help take some of the pressure off of the VA system, so it can focus on providing the specialized care that is is known for.
Tier 2: Expand Medicare to all Americans eligible for Medicaid and Black Lung Benefits. While Medicaid is an extremely important program, it has been damaged by poor funding and political manipulation. That’s why my plan automatically moves all current Medicaid enrollees into Medicare Part E. These enrollees will pay no premiums, but will make small copayments for each visit to a doctor, hospital, or any other covered provider, but only after getting two free preventive visits a year. Any citizen whose income is at or below twice the federal poverty line ($24,000 per year for an individual and $50,000 for a family of four) would also be eligible under tier 2. We should also allow current and former coal miners who have applied for or received Black Lung benefits to join Medicare under this tier.
Tier 3: Provide all US citizens the option to enroll in Medicare. Much like current private plans, citizens joining Medicare will pay a monthly income-based premium and will make small copayments for each visit to a covered provider. However, unlike private health insurance, Medicare will not have any deductibles or lifetime caps, and the monthly premiums will be much lower. The average family will save around $3600 a year by moving from private insurance to the Medicare program.
What it Means for Patients and Providers
As a patient, all you need to do is go to a covered doctor, show your Medicare insurance card, and in some circumstances, make a small co-payment. This means no more deductibles and no more fighting with insurance companies to make them pay up. Once you are home and healthy, you’ll never have to worry about bills or collections.
Doctors and other healthcare providers will have an easier time processing their bills and payments, since they will be dealing mostly with the Center for Medicare/Medicaid Services. Americare will also include measures to streamline billing and payment systems so doctors can get paid as quickly as possible, and focus all of their time and energy on providing care. I want America’s world-class doctors spending all their time with patients, not dealing with billing codes and paperwork. We also hope that this will allow more doctors to start or continue their own independent practices, in order to buck the current trend of provider and hospital consolidation.
Getting Costs Under Control
Right now, the US has thousands of different health insurance plans, all of which set different reimbursement rates across different networks for providers and procedures. All this unnecessary paperwork adds high administrative costs to the entire healthcare system. Two patients with the same condition may get very different care depending on where they live, the health insurance they have and what their insurance covers. A patient may pay different amounts for the same prescription depending solely on where the prescription is filled. Healthcare providers and patients have to navigate this complex and bewildering system, which wastes their precious time and resources.
By moving to a more integrated system, we will finally have the ability to stand up to drug companies and negotiate fair prices for the American people collectively. It will also ensure the federal government can track access to various providers and make smart investments to avoid provider shortages and ensure communities can access the providers they need. We will also beef up our inspection and auditing teams, to make sure that providers are not ripping off the system.
Private insurers’ overhead currently averages 12.0%, as compared with only 2.1% for Medicare. The complexity of reimbursement systems also forces physicians and hospitals to waste substantial resources on documentation, billing and collections. As a result, U.S. healthcare administration costs are about double those in Canada, where hospitals and doctors are paid via simplified fee schedules. Reducing U.S. administrative costs to Canadian levels would save over $400 billion every single year.
The reality is, Americare will save hundreds of billions of dollars every year over the current system, while actually covering everyone at the same time. By eliminating huge inefficiencies in the insurance and provision systems, we can allocate our medical resources in fairer and more efficient ways.
The US currently spends $3 trillion on healthcare each year, which comes out to nearly $10,000 per person. So by simplifying our payment structure and incentivizing new ways to make sure patients are actually getting better healthcare, has the potential to generate massive savings.
Last year, the average working family paid $4,955 in premiums and $1,318 in deductibles to private health insurance companies. Under Americare, a family of four earning $50,000 would only pay around $3000 a year in premiums, with no deductibles at all. This amounts to a savings of about $3600 for that family each year. Imagine how many movie nights and summer vacations that could pay for!
Americare would also be a huge boost to American businesses both large and small. Currently, the average annual healthcare cost for employers for a worker with a family who makes $50,000 a year is $12,591. This entire expense would disappear for employees who join Medicare Part E, giving businesses a tremendous amount of money to invest in raising salaries, expanding their business, or providing other fringe benefits to employees.
Huge Savings for States
State governments are currently required to pay anywhere from 25% to 50% of Medicaid spending in their states. While the federal government covers the rest, this cost-sharing system places an enormous financial burden on state governments, many of which fund themselves through regressive sales and income taxes, and must pay high interest/coupon rates when issuing bonds. In 2016 alone, the 50 states were responsible for over $200 billion of Medicaid’s spending, which put significant pressure on their operations.
My plan to transfer all Medicaid beneficiaries into the Medicare system would save the states at least $200 billion in the first year alone. This would free up an enormous amount of money for local governments to use on improving schools, building parks, increasing salaries for teachers and police, and boosting social service programs like foster care and addiction prevention.
In addition to the massive efficiency gains from this program, here’s how we will offset costs:
- Taxing capital gains and dividends the same as income from work. This will raise about $92 billion per year. This plan will end the special tax break for capital gains and dividends on household income above $250,000.
- Savings from health care premium tax expenditures. Several tax breaks that subsidize employer paid insurance (health-related “tax expenditures”) would become obsolete and disappear under Americare. Additionally, insurance provided by employers is compensation that is not subject to payroll taxes or income taxes under current law. This is a significant tax break that would effectively disappear under this plan.
- A sales tax on financial transactions, as described in the economy section.
Improving the Practice of Medicine
- Adjust and clarify medical Standards of Care, so General Practitioners can perform more exams and procedures without the risk of malpractice suits.
- Allow Nurse Practitioners to perform more general healthcare tasks to take pressure of off doctors.
- Allow trained Psychologists with 5 or more years of practice to prescribe generic medications that have been in use for 10 or more years.
Currently practicing doctors are retiring at increasing rates, and our General Practitioner-to-Specialist Ratio is higher than other countries due to poorly structured incentives. Therefore, we need to train thousands more doctors per year, and do it quickly, by:
- Eliminating limits on medical residencies. The current system effectively places a limit on the amount of medical school graduates who enter can residency, which is a critical step to becoming a doctor. Therefore, all US medical school graduates should have the opportunity to complete their medical training by becoming residents. All students of foreign medical schools who permanently reside in the United States shall have the same right. These limits artificially constrict the supply of doctors in the US, and therefore drive costs way up. There is simply no good economic reason to limit medical residencies.
- Creating a medical pipeline curriculum, which allows a student to become a fully licensed, practicing doctor after a minimum of 8 years of post-high school education and residency. The Departments of Education and Health and Human Services could work together to develop this pipeline. All students who commit to and complete this program will not have to pay any tuition fees for for the entire course of the program. However, these new doctors must spend at least 4 of their first 10 years of practice in a designated low-income or rural community, as defined by the US Census Bureau.
- Making it easier for foreign-trained doctors to practice in the US by easing and clarifying permitting requirements and granting residencies to foreign medical students.
- Directing Medicare to fund thousands more residency slots, with 70% of these slots going exclusively to future general practitioners.
We could also save billions of dollars a year by reducing the prices of drugs and medical devices by:
- Shortening pharmaceutical and patents to 5 years, from the current 20. Patents issued by the US government to drug companies have the effect of raising drug prices by hundreds, sometimes thousands of times. The actual cost of producing many expensive drugs is a fraction of the price paid by consumers. Shortening patent lengths for drugs would introduce tons of new market competition among the thousands of generic companies across the US and bring prices down significantly.
- Separating the costs of drug research and drug production. The use of patent monopolies to fund research and development of new pharmaceuticals is a grossly inefficient and opaque financing mechanism. Instead, the US government should reward scientific research entrepreneurs by buying their drug formulas and making them public. Then, it could allow the many thousands of drug manufacturers and compounding pharmacies to bid for the rights to produce this drug, as efficiently as possible.
- Prohibiting Direct-to-Consumer Advertising of Prescription Drugs. The US is one of only two countries on earth that allow for-profit drug companies to advertise directly to consumers. As we all know, our TV shows and magazines are inundated with drug ads that emotionally manipulate consumers into “talking to their doctors.” This predatory model intrudes on the ability of medical professionals to objectively treat their patients. We need to ban all forms of prescription drug advertising, so our doctors can take care of their patients without BigPharma’s manipulation and meddling.
- Negotiating drug and medical device prices, in order to get the costs as close to the marginal cost of production as possible.