Now that another GOP attempt at stripping tens of millions of vulnerable citizens of their healthcare appears to be over, DSA and the country at large must look to the best way forward for the future of our health care and the betterment of our society.
It is clear the only manner by which health can be accessed without exception is a universal Single-Payer, Medicare For All distribution system. This goal is one our organization has prioritized nationally, and the path forward is becoming clear.
Democratic Socialists of America – Los Angeles is proud to join Democratic Socialists of America National in endorsing the Medicare for All Act of 2017. This bill describes a program that moves the United States towards humane, equitable and inclusive healthcare, and DSA-LA will fight alongside our comrades for its improvement and enactment.
S. 1804, introduced by Senator Bernie Sanders on September 13, 2017, would create a Universal Medicare Program (UMP) for every resident of the US, with eligible residency to be determined by the HHS. The UMP would provide a comprehensive set of benefits, private insurance could not offer any benefits covered by the UMP, and providers would not be allowed to bill more than the UMP pays. This would preclude employer-sponsored insurance and Medicare Advantage, though individuals could pay other amounts for services on a cash basis, if agreed to in a written contract ahead of time. Provider participation would not be mandatory. The only non-UMP healthcare programs that could continue would be the VA and Indian Health Services, except that long-term care would be covered by the states (presumably meaning via Medicaid).
On January 1 of the first year following enactment, benefits under the UMP would be available (but not mandatory) for anyone 18 and younger. At the same time, traditional Medicare would be expanded to be similar to the UMP benefits, reducing the cost-sharing and expanding the benefits, and the eligibility age would lower to 55. Those 45 and under could buy-in to this ‘transitional Medicare’ program in the second year, and then 35 and under the third year. Also during the transition, a second temporary public option would be available for buy-in. Premiums for both buy-in options would be determined by HHS, and citizens and legal permanent residents would be eligible. On January 1 of the fourth year following enactment, UMP would take over for everyone, and private insurance and transitional Medicare would cease to be offered for those benefits.
Benefits under the UMP would be comprehensive:
- Hospital services (in- and outpatient, ER and inpatient prescription drugs)
- Ambulatory patient services
- Primary and preventive services
- Prescription drugs, medical devices, biological products, including outpatient
- Mental health and substance abuse treatment
- Laboratory services and diagnostics
- Comprehensive reproductive, maternity and newborn care
- Language stating that “any other provision of law in effect on the date of enactment of this Act restricting the use of Federal funds for any reproductive health service shall not apply to monies in the Trust Fund” appears to bypass abortion restrictions per the Hyde amendment
- Oral health, audiology and vision services
- Short-term rehabilitative and habilitative services and devices
States could offer other benefits at their own expense, and set standards that don’t restrict eligibility or decrease access to the program. HHS would periodically review the benefits package and determine coverage for experimental services. There would be no permitted cost-sharing (deductibles, coinsurance, copays) with the following exceptions:
- The new Medicaid long-term care program
- Prescription drugs and biological products, not including preventive drugs, up to $200/year for an individual (to be adjusted for inflation). HHS could decide to exempt some brand-name drugs with generic equivalents from the $200 limit to encourage generic usage.
Sanders’ bill does not include a financing mechanism. However, he also released a white paper with a list of ten potential sources of revenue. The largest (over $1 trillion each over 10 years) of his noted financing generators are:
- A 7.5% payroll tax paid by employers, exempting the first $2 million in payroll (small employers) ($3.9 trillion)
- A 4% earnings tax paid by households, with the standard deduction exempting families of four making less than $29,000/year ($3.5 trillion)
- Revenue from the removal of the employer-sponsored healthcare tax exemption ($4.2 trillion)
- Increasing taxes on high-earners via income tax, capital gains and dividends tax, and capping deductions ($1.8 trillion)
- Adding a new 1% wealth tax on the top 0.1% ($1.3 trillion)
Relying on progressive taxes rather than set premiums, deductibles and coinsurance to fund the UMP would significantly reduce the financial burden that healthcare now puts on many working families as well as reducing uncertainty. The proposed 4% earnings tax, for instance, would amount to a tax payment of $840 for a family of four earning $50,000 per year, instead of the average working families’ contribution of $5,714 in premiums even before the unpredictable expenses of deductibles, co-pays and coinsurance.
Considerations for DSA-LA
As delineated in a communication from DSA National Director Maria Svart on September 5, 2017, DSA has a set of standards for a single-payer bill to gain its support. Here are the five concerns measured against S.1804:
- A single program: The UMP, once fully enacted, would be a single universal and comprehensive program, leaving only the VA, Indian Health Services and long-term care under separate programs.
- Comprehensive coverage: The UMP would offer comprehensive coverage similar to the ACA’s Essential Health Benefits requirements, though significant discretion is left to HHS on determining things like a more specific list of covered benefits, medical necessity and appropriateness of benefits, establishing of the national health budget, etc.
- Free at the point of service: The UMP would have cost-sharing in two areas: prescription drugs (mostly capped at $200) and long-term care (unknown if there will be a limit). This would be a significant reduction in average out-of-pocket expenditure, since the US had an average annual out-of-pocket spending per capita of over $1,000 in 2010 but would mean an added cost for those who require medications.
- Universal coverage for all US residents regardless of citizenship: UMP eligibility would be according to residence, which potentially allows for undocumented residents of the US to be covered as well as residents with temporary or permanent legal status. However, the Secretary of HHS would ultimately have responsibility for determining and defining eligibility, so coverage of undocumented residents is not definite.
- Job assistance for displaced workers: For up to 5 years following the full rollout of the program, up to 1% of the budget can be allocated to providing assistance to workers displaced from the administration of the health insurance system.
The bill was introduced with the endorsement of the following organizations and unions:
- Labor Campaign for Single Payer
- Our Revolution
- Social Security Works
- Progressive Campaign Change Committee
- Democracy for America
- Working Families Party
- All of Us
- Demand Progress
- Health Care Now
- Progressive Democrats of Amerca
- Public Citizen
- Latinos for Healthcare Equality
- Americans for Democratic Action
- AIDS Healthcare Foundation
- Food & Water Watch
- Friends of the Earth
- American Sustainable Business Council
- LULAC (League of United Latin American Citizens)
- National Nurses United
- International Association of Machinists and Aerospace Workers
- New York Nurses Association
- Utility Workers Union of America
- International Federation of Professional and Technical Engineers
- United Mine Workers of America
- Amalgamated Transit Union
- Brotherhood of Maintenance of Way Employees Division of the International Brotherhood of Teamsters
 The Commonwealth Fund, International Profiles of Health Care Systems, May 2017.