Is It Finally Time for the Government to Hand Out Health Insurance?

Left-wing reformers say they know how to fix America's broken healthcare system, and hope to persuade Trump.
March 29, 2017, 5:18pm
Image by Lia Kantrowitz

Last week, Republicans in Congress learned just how hard it is to change the healthcare system in America. After a botched rollout and a couple brief weeks of fruitless negotiations, House Speaker Paul Ryan and President Donald Trump had to withdraw the American Health Care Act from consideration, putting an end to the latest chapter of the long, angry conservative crusade to repeal Barack Obama's signature law.


Ryan still wants to repeal the Affordable are Act, while Trump has signaled he'd rather wait for the healthcare regime to "fold" or "explode" before intervening. But however they want to dress their joint failure up, Obamacare remains in place—and so do the myriad problems with it.

Lots of Americans remain unhappy with the state of their health insurance. Either they can barely afford their monthly premiums, or their deductibles are so high that they barely feel they have insurance at all. Maybe they buy plans through one of the state exchanges that insurers have increasingly abandoned, citing low profits. More broadly, healthcare in the US remains overpriced and shitty. Part of what doomed the AHCA is that it was never clear how it would solve these problems. Polls have found that people want the ACA fixed, not dismantled—but rather than increasing subsidies and trying to get more healthy people on the exchanges to drive premiums down, the AHCA would have done the opposite, making insurance more expensive for many.

For political and ideological reasons, it seems vanishingly unlikely that Republicans will support pumping more government money into the health insurance system. So in the past few days, some Democrats have stepped up to offer their own solution to the ACA's shortcomings: namely, what if the government just straight-up gave people health insurance?

The simplest form of government-provided health insurance is called "single-payer." You know Medicare, the federal health insurance program for seniors? That very popular program? So give everyone that, basically, and you've got single-payer, which Bernie Sanders calls "Medicare for all." Over the weekend, Sanders announced he'd introduce a single-payer bill in the Senate and hoped Trump would support it. The Vermont senator has been pushing for single-payer since before many of his fans were old enough to vote, but this week he was joined by a host of other progressive Democrats and writers for left-wing outlets like In These Times and The New Republic.

One argument for single-payer is that healthcare is a basic human right and should be provided to people regardless of their ability to pay. Another is that most industrialized nations give insurance to people more freely than the US does. But a less obvious—and less morality-based—case is that single-payer would eliminate a lot of the middlemen in the system. Currently, the American healthcare "wastes tremendous amounts of resources," as Don McCanne told me. He's a senior health policy fellow at the advocacy group Physicians for a National Health Program, and by his own admission is "obsessed" with single-payers. McCanne says the US spends hundreds of billions of dollars in administrative costs thanks to its complex web of private and public insurers. "If you got rid of that and just had a Medicare for all—an improved Medicare for all—you would recover that," he added.


The main obstacle to implementing single-payer is the same thing that made the ACA so controversial and killed the AHCA: Any reform to the healthcare system is bound to create winners and losers, and big changes will inevitably cause outrage. And though single-payer advocates often claim it's popular, the polling is far from clear. One Associated Press survey last year found that when some possible side effects of the system were described (like higher taxes on everyone) support dropped. And efforts at the state level to create Medicare-for-all-esque systems have failed—in Colorado, activists got the question on the ballot last year and it only earned 21 percent of the vote.

Helen Halpin has been in the trenches of a lot of healthcare fights over the years. Now a professor emerita at the University of California, Berkeley, she helped craft the "public option," the other reform Democrats have been dreaming of for a while now. Originally called CHOICE, her idea was a "huge compromise" that came out of a meeting of female healthcare experts convened by Halpin in 2001. The basic proposal was to allow people buying insurance through an exchange to buy plans from the government as well as private companies. "You're not forcing anyone to use private insurance if they don't want private insurance, and you're not forcing anyone to go into a government plan," Halpin explained.

Though it never got off the ground in California, the public option was taken up by a variety of Democratic healthcare wonks, and during the 2008 election, all the major Democratic candidates—including Barack Obama—endorsed it. During the original debate over Obamacare, getting a public option was the whole ballgame for many progressives, who hoped a government-run insurance agency would be able to negotiate lower prices with hospitals and the pharma industry, resulting in lower costs for consumers. Though many versions of the bill included it, a few moderate Democratic senators vowed not to vote for any bill that opened the door to people signing up for government health insurance not called Medicaid. In the end, the public option was scrapped.


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Halpin still thinks the public option would not only still work, it would fix some of the ACA's most glaring flaws. It could create competition and choice in where insurers have abandoned the exchanges; as Halpin puts it, a public option would "provide a way to give people the option to transition into a public plan." If government insurance turned out to be much better than private insurance, it could be a stepping-stone to a system that looks like single-payer—one of the reasons the right hates the public option with a passion and has deriding it as a "government takeover" of healthcare.

But McCanne, the single-payer advocate, doesn't think much of the public option. For one thing, he told me, that would leave the same old convoluted insurance system in place. "It won't get us there," he said. And any public option that got through Congress would likely be so watered-down by the insurance industry lobby that it would be worthless—though he did concede that some versions of the public option "would not be a step toward single-payer, but would be a good option for a lot of people."

If the argument against the public option is that it's too incremental, the argument against single-payer is that it's too radical a change to be accepted by America. "If you cut out the insurance companies completely tomorrow, half a million people lose their jobs. Nobody wants to do that," said Halpin. "And 'Medicare for all' sort of sounds like you don't have a choice."


For now, of course, the debate between those two healthcare reforms amounts to an argument over what color of unicorn progressives like best—with Republicans in control of the federal government, both proposals are nonstarters. Instead, it's likely that moderate, bipartisan steps will be taken to help repair or prop up the Affordable Care Act. (More Republican-run states are considering green-lighting Medicaid expansions allowed under the original law, for instance.)

Single-payer especially would take a long time to sell to the American people, even though more and more progressives have endorsed it. "Any strategy would have to look beyond the next one or two elections," McCanne admitted.

The public option, on the other hand, is already mainstream. A broad coalition of Democratic senators, including Sanders, introduced a bill calling for a public option back in September, and Hillary Clinton endorsed it as well. A public option could become the Democrats' version of the Republicans' "repeal and replace" rallying cry, a policy embraced by both moderates and Sanders-esque leftists—vote for us and this is how we'll fix the healthcare system, they could tell Americans.

But Halpin floated a way that the public option could happen sooner. Trump himself has never seemed very ideological on healthcare, and has made vague promises about getting more Americans covered. If the Democrats took back Congress in 2018, would the president decide that he needed to cut a deal and fix the ACA, even if that fix meant rejecting conservative ideas?

Left-wing healthcare reformers think there's a shot. "President Trump, come on board," Sanders said on CNN Sunday. "Let's work together."

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