During a House Budget Committee hearing on Wednesday, Rep. Dan Crenshaw (R-TX) engaged with the Deputy Director of the Congressional Budget Office (CBO), Mark Hadley, and expertly dissected several of the major negatives of a single-payer health care system.
CRENSHAW: I think it is time to put to rest [the] many false promises of Medicare-for-all and single-payer systems. Mr. Hadley, I want to start with talking about supply. On page 22 of the report from the CBO, you say, “Studies have found that increases in provider payment rates lead to a greater supply of medical care whereas decreases in payment rates lead to a lower supply.” Is this correct?
HADLEY: That’s correct. That’s what the report says.
CRENSHAW: Price controls, which are necessary when moving everyone under one payment rate, it affects supply, correct?
HADLEY: Yes, it can.
CRENSHAW: [A] single-payer system using current Medicare reimbursement rates decreases the number of doctors – they simply don’t get paid enough to keep up with expenses.
Second point, triage under single-payer systems. Do providers typically bill for whatever they want or is there an approved treatment list?
HADLEY: Typically there would be an approved treatment list.
CRENSHAW: Thank you. Generally, in single-payer systems, is the government or a government body in charge of listing out national guidelines and standards for practice that doctors must follow?
HADLEY: So, usually it’s a set of standardized practices, but that can be done sometimes by an independent advisory board…
CRENSHAW: Somebody has to do it. Under these systems, what are common methodologies for deciding what is listed on the national guidelines or standards? Is it a cost-benefit analysis?
HADLEY: Yes, they look at cost-effectiveness, but then through the prices for those, sometimes it’s through negotiation.
CRENSHAW: So, what we get to – maybe it’s a government bureaucrat, maybe it’s a third party – but a bureaucrat is using a cost-benefit analysis formula that will decide what a patient is approved for.
Third thing I want to hit, innovation. So, we have two issues here so far. We have lower payments to providers and a government-run list of approved care options. We have to ask ourselves, why would anyone invest in new, cutting-edge medical technology or medications? You won’t get paid as much; you’re not even sure the government will allow doctors to use your new innovation. How do you think that changes the calculus of investors? It changes it enormously.
Fourth thing I want to hit, quality of care. In your report, you write, “If the number of providers was not sufficient to meet demand, patients might face increased wait times and reduced access to care.” Is this correct?
HADLEY: That’s correct.
CRENSHAW: Later in your report, you say, “Public plans might not be as quick to meet patients’ needs such as covering new treatments.” Correct?
HADLEY: Correct.
CRENSHAW: If we measure quality of care and wait times and innovative new care, wouldn’t we agree that quality is decreasing? So, there’s less providers, there’s less innovation, longer wait times, and overall less quality. This isn’t even the worst part. Let’s move on to who this might actually hurt the most.
Director Hadley, in your testimony, you write, “The public plan would provide the same set of health care services to everyone eligible, so it might not address the needs of some people. For example, the public plan might not be as quick to cover new treatments and technologies as would a system with competing private insurers.” In your testimony, you’re saying that a single-payer system might not address the needs of some people who need access to new treatments and technologies, correct?
HADLEY: That’s correct, depending on the design of the program.
CRENSHAW: Would you say that some of these people who need new treatments, they could be patients with cancer, genetic disorders, patients who suffer from two diseases like fatty liver disease or diabetes – all of whom have very complicated, complex conditions?
HADLEY: It would really depend on how quickly, and which technology or treatment was being provided, and which group that affected.
CRENSHAW: Sure, but in your testimony, you said “some people,” and it could easily include these people. Could those people that I just listed also be described as people with pre-existing conditions?
HADLEY: Yes.
CRENSHAW: So, a single-payer system is worse for people with pre-existing conditions. A private system is better for people with pre-existing conditions than a public system.
Let’s talk about what we’ve learned here, let’s summarize it. A single-payer system has to set prices, and if set at current Medicare rates, which all plans call for, this drastically cuts the money going to doctors and hospitals. They will have to cut resources. They will hire less, [and] they will buy less equipment. It is simple economics. Because there are less doctors, wait times will increase. With this newfound world of less doctors and more patients, the government will have to carefully screen or triage who gets care and who doesn’t, and what kind of care they get, all based on bureaucratic cost-benefit analysis. Innovators will be less likely to invest in a system where the payoff is significantly less because they can’t be sure whether the government bureaucrat will even allow doctors to use that new medical device, medication, or new procedure, and counterintuitively, the system ends up hurting patients with the most unique conditions, also knows patients with pre-existing conditions, because their care requires flexibility and innovation, both of which are drastically reduced in a single-payer system.
A primary issue when it comes to the health care debate in the United States is that the Democratic Party has been able to articulate their platform with buzz-phrases like “Medicare-for-all” and “universal health coverage.” These buzz-phrases effectively gloss over the critical details of implementing such a plan, creating a kind of psychological shortcut in the minds of their constituency.
Meanwhile, Republicans have struggled on two ends. First, they have often failed to succinctly dissect the negative ramifications of a single-payer health care system. Second, they have failed to articulate and disseminate to the voters their own solution.
What Rep. Crenshaw did so masterfully in the video above was concisely reveal several major flaws of a single-payer system — the lack of options for individuals with pre-existing conditions, the slowdown of medical and technological innovation, and the potential rationing of care.
If the Republican Party wants the American people to understand the consequences of a Medicare-for-all system, and therefore reject it, they need more politicians offering these brief and cogent analyses.