How Medicaid is popularizing single payer approaches to health care

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Governors in 31 of our 50 states are fast at work familiarizing themselves and socializing themselves to a new way of managing the health of populations within their geographic boundaries — single payer systems.

Despite the attempt to brand the term “single payer” the way that Medicare was attacked a half century ago as big government “socialized medicine,” the majority of governors has tacitly acknowledged what Warren Buffett described as a health care status quo that is “the tapeworm of American economic competitiveness.” The decline of state economies reinforced by the burden of weak social systems, challenged and undermined by a raging opioid epidemic, have caused Republican governors like John Kasich to declare independence when it comes to health policy.

Way back in 1965, when Canada endorsed a single payer approach for all Canadians, Americans did the same — but only for those over 65. We called it Medicare, and while it has had issues over the past half century, Americans long ago decided they couldn’t live without it. Of course, until now, they also consented to widening income disparity and health inequality based on a system of “have’s” and “have-not’s” when it comes to the good fortune (or lack of the same) of possessing health insurance.

President Obama’s federal subsidization of an expanded Medicaid with broader eligibility and more generous coverage and protections hit the sweet spot with all but the reddest of red state governors. Those hold-outs were literally willing to financially cut off their noses to spite their faces. For others like Kasich who were willing to give President Obama a chance, they liked the way it felt to actually lead and so did the citizens in their communities.

Medicaid celebrated a new approach (within the corridors of defined eligibility) of universality, access, health planning, portability, and integration with other social service programming. Participating governors liked the fact that the program was well funded, that the benefit package was broad (not a sham like the HSA induced high deductible/ empty benefit products proliferating everywhere), and that they preserved the flexibility within bounds to set the priorities on spending and defined how best to advance the overall health of their state populations.

The governors learned that centralized administration of a universally available health insurance offering carried distinct cost savings. Specifically, governor guided single payer health delivery under Medicaid came in 22 percent less costly than privately insured comparators. Governors like Kasich were left to wonder what might be the economic impact on Buffett’s “tapeworm” were their lessons to be applied across our entire population — single payer back office administration combined with state controlled and planned integrated health delivery. They read the studies that showed a potential immediate 15 percent savings on our 4 trillion plus annual bill simply by consolidating management of a universal coverage approach in a central systematized fashion.

Governors also could see that the human resource implications of such a move. Our purposefully complex program, which now threatens to break the American economy in much the same manner as reckless military spending collapsed the Soviet Union, has spawned 16 non-clinical jobs in health care for every one clinical role. A shift to single payer, poorly planned and transitioned, could carry with it massive unemployment. But if you look at innovators like Kasich, what you see is active reassignment of jobs by skill in a manner that advances the public good. The governor well understands that the U.S. is the only civilized nation in the world where more is spent on the mechanics of disease fighting than on all social services combined — the very combination of services and supports that help keep a population well. With flexibility, as wildly expensive nursing home use declines, those employees, now mobile, are an immediately useful and experienced mobile home services health corps. Given room for innovation, as they have been under the ACA, governors have applied both innovation and structural remodeling to expand safety, security, and health across multi-generational families.

The Medicaid single payer experiment has been large scale. Under the direction of autonomous state leaders, 77 million have received care of late with extraordinary high satisfaction levels. 34 million of these citizens are children. 2 million new citizens will be ushered into the human race this year through Medicaid prenatal and obstetric coverage. 9 million blind and disabled citizens sleep easier each night thanks to the governors. By 2026, absent Trumpcare regression, the 77 million will grow to 86 million with 35 million children in the ranks. Nearly a third of the states structure offerings through a managed care approach. All integrate physical and mental health, including addiction services.

Governors like Kasich have turned a critical eye toward waste. For example, Medicaid has historically been the primary payer of long term care — specifically nursing homes. Over decades, perverse incentives have created a lawyer and nursing home industry driven cottage industry designed to divest seniors of their assets so that they could reach eligibility requirements to have free nursing home care. Nearly half of all spending  for long term care in the U.S. — over $150 billion a year — comes from Medicaid. Flexibility provided to governors like Kasich could allow the realignment of financial incentives with funds provided for home services to multi-generational families who do right by their seniors rather than abandon or warehouse them.

Innovative programs like Money Follows the Person or The Program of All-Inclusive Care for the Elderly (PACE) should not be confused with the Senate Republicans offerings. Their caps have little if anything to do with innovation and more to do with transferring some $800 billion over the next 10 years from the neediest to the wealthiest Americans in the form of tax cuts.

Trump and his followers may be intent on creating chaos, promoting regressive legislation, and reimagining reality, but governors in most states are laser-focused on solutions — and the more they experience single payer efficiency, control, and integrated health planning, the more they and their citizens like it.

Mike Magee

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