With hospitals overrun, millions home with flu-like symptoms, and temporary morgues now operating in most major cities, the hot-button issue of universal healthcare has again entered our collective national conscience. As it stands, the U.S. is the only modern, industrialized nation that does not provide universal healthcare to its citizens. The arguments for and against what would be a policy change worth trillions have remained at the forefront of American politics for decades.
What’s Ailing Americans: By the Numbers
With an estimated 330 million people, the U.S. ranks third on the list of most populated countries. As a nation that faces record levels of obesity, diabetes, and high blood pressure, it’s no surprise that thousands die each year from preventable conditions. According to data from the National Center for Health, nearly 40 percent of adult Americans are obese, a term used to classify someone with a Body Mass Index over 30.
The alarming rate of obesity in the U.S. has led to millions needing prescription medication, routine checkups, specialized diets, and vital surgeries – all the while placing a constant strain on the current healthcare system. Other conditions such as Alzheimer’s, stroke, emphysema, and pneumonia can be largely attributed to the increase in American life expectancy.
According to the CDC, the rate of cancer in the U.S. increases 1-2% each year on average. Total U.S. expenditure for cancer care in 2017 was an estimated $143B. Researchers predict that as the national population continues to age and more people become obese, cases of cancer will unfortunately be much more prevalent. The trend is illustrated below.
Although a rise in obesity-related deaths may not be unexpected, the number of drug overdoses in the U.S. has certainly rattled the nation. When the Purdue Pharma drug Oxycontin, was introduced to the American public in the late 1990s, it was marketed as a non-addictive and safe way to manage pain. As such, healthcare providers wrote prescriptions for opioids in staggering numbers.
When studies began to show that Oxycontin was not only addictive, but up to 100 times more addictive than heroin, the damage had already been done. The drug was been distributed to millions before anyone could sound the alarm. Those who could not get their hands on Oxy switched to cheaper, illegal options such as crack, heroin, and fentanyl.
According to the National Institute on Drug Abuse, more than 47,000 Americans died from an opioid overdose in 2017. These overdoses were a direct result of prescription opioids, heroin, and illicitly manufactured fentanyl. That same year, an estimated 1.7 million people in the United States suffered from substance use disorders related to prescription opioid pain relievers. The Council of Economic Advisors now predicts that between 2015 and 2018, the opioid crisis cost the U.S. $2.5T.
The History of American Healthcare
American healthcare reform stretches across several decades and multiple presidential administrations, some more successful than others.
Lyndon Johnson Signs Medicare Into Law
When President Lyndon Johnson signed the Social Security of Amendments into law in 1965, the act established Medicare. Under the new program, people over the age of 65 were provided hospital insurance and medical assistance. The new piece of legislation also enacted the creation of Medicaid, a program for those who could not afford health insurance.
Up to that point in American history, there had been several attempts to create a universal healthcare system, but all had failed. Presidents Roosevelt and Truman both pushed for healthcare reform yet failed to do so. Lyndon Johnson’s watershed legislation finally passed through Congress when Arkansas Democrat Wilbur Mills switched his position in favor of Medicare. From that moment on, Americans began to rely on the government to provide healthcare.
Bill Clinton Fails To Expand Upon Medicare
In the early 1990s, President Bill Clinton pushed to expand upon Medicare by creating a truly universal healthcare system. First Lady Hillary Clinton testified before the House Committee on Ways and Means to explain the proposed Health Security Act.
Besides universal coverage and a basic benefit package, the act included health insurance reform, regional alliances for structuring competition among health insurance plans, consumer choice of health plans, and provisions for Medicaid beneficiaries. Proposed mental health and substance abuse provisions included coverage of intensive nonresidential services, medical management, evaluation and assessment services, and case management. The legislation failed in 1994.
George Bush Finally Expands The Health Care System
The healthcare plan President Johnson signed into law in 1965 was finally expanded in late 2003. President George W. Bush created the $400B Medicare Prescription Drug Modernization Act to help Medicare recipients afford prescription drugs. The act also provided billions in subsidies to insurance companies and allowed for the importation of drugs from Canada. Yet, critics argued that the act forced seniors into high-priced plans.
The Affordable Care Act – Obamacare
In 2010, President Barack Obama signed the Affordable Care Act into law. The act stipulated that citizens had to either obtain health insurance or pay a fine. Billions in subsidies were provided for people who could not afford coverage and medicare was greatly expanded in most states. Although Obamacare stipulated that insurance companies could not discriminate on the basis of pre-existing conditions, some Democrats criticized the act for not creating a universal health care plan for those who could not afford Medicare or Medicaid.
What Will Healthcare Look Like In The Future?
The two most-talked about healthcare proposals are the Medicare For All plan by Senator Bernie Sanders and former Vice President Joe Biden’s plan to protect and build upon Obamacare.
Medicare For All
Although Senator Sanders is now officially out of the presidential race, his healthcare plan still remains at the forefront of any discussion on healthcare. Under the Sanders plan, there would be a national, single-payer, health insurance plan that would be free at the point of service. The plan would offer dental, vision, in-patient, out-patient, mental health, etc. Medicare For All would also cap all pharmaceutical drugs at $200 per year for all Americans.
How Would Medicare For All Be Funded?
Medicare For All aims to save the country $5T over 10 years. Find out how:
- Creating a 4 percent income-based premium paid by employees, exempting the first $29,000 in income for a family of four.
In 2018, the typical working family paid an average of $6,015 in premiums to private health insurance companies. Under this option, a typical family of four earning $60,000, would pay a 4 percent income-based premium to fund Medicare for All on income above $29,000 – just $1,240 a year – saving that family $4,775 a year. Families of four making less than $29,000 a year would not pay this premium.
(Revenue raised: About $4 trillion over 10 years.)
- Imposing a 7.5 percent income-based premium paid by employers, exempting the first $1 million in payroll to protect small businesses.
In 2018, employers paid an average of $14,561 in private health insurance premiums for a worker with a family of four. Under this option, employers would pay a 7.5 percent payroll tax to help finance Medicare for All – just $4,500 – a savings of more than $10,000 a year.
(Revenue raised: Over $5.2 trillion over 10 years.)
- Eliminating health tax expenditures, which would no longer be needed under Medicare for All.
(Revenue raised: About $3 trillion over 10 years.)
- Raising the top marginal income tax rate to 52% on income over $10 million.
(Revenue raised: About $700 billion over 10 years.)
- Replacing the cap on the state and local tax deduction with an overall dollar cap of $50,000 for a married couple on all itemized deductions.
(Revenue raised: About $400 billion over 10 years.)
- Taxing capital gains at the same rates as income from wages and cracking down on gaming through derivatives, like-kind exchanges, and the zero tax rate on capital gains passed on through bequests.
(Revenue raised: About $2.5 trillion over 10 years.)
- Enacting the For the 99.8% Act, which returns the estate tax exemption to the 2009 level of $3.5 million, closes egregious loopholes, and increases rates progressively including by adding a top tax rate of 77% on estate values in excess of $1 billion.
(Revenue raised: $336 billion over 10 years.)
- Enacting corporate tax reform including restoring the top federal corporate income tax rate to 35 percent.
(Revenue raised: $3 trillion ,of which $1 trillion would be used to help finance Medicare for All and $2 trillion would be used for the Green New Deal.)
- Using $350 billion of the amount raised from the tax on extreme wealth to help finance Medicare for All.
Detractors of Medicare For All state that the plan could never work in a capitalist country such as the U.S. A majority of Americans want to feel like they have a choice in what medical plan they want to select. Many argue that complete government control of something as important as health could never be adopted by Americans.
Joe Biden: Expand Obamacare
It comes as no surprise that Joe Biden, now the presumptive democratic candidate for president, would back Obamacare. As Vice President under Barack Obama, it would be a disservice for Biden to throw out a plan he helped become law.
Under the expanded plan, out-of-pocket expenses for many would be lowered, yet there would still be deductibles and copays unlike under Medicare For All. The expanded Obamacare plan would provide free coverage for lower-class Americans in states that have not yet expanded Medicare under Obamacare.
How Would Expanded Obamacare Be Funded?
To fund the expansion of Obamacare, the former VP explained that he would eliminate capital gains tax loopholes for wealthy Americans among other things.
“The Biden Plan will make healthcare a right by getting rid of capital gains tax loopholes for the super wealthy. Today, the very wealthy pay a tax rate of just 20% on long-term capital gains. According to the Joint Committee on Taxation, the capital gains and dividends exclusion is the second largest tax expenditure in the entire tax code: $127 billion in fiscal year 2019 alone.
As President, Biden will roll back the Trump rate cut for the very wealthy and restore the 39.6% top rate he helped restore when he negotiated an end to the Bush tax cuts for the wealthy in 2012. Biden’s capital gains reform will close the loopholes that allow the super wealthy to avoid taxes on capital gains altogether. The Biden plan will assure those making over $1 million will pay the top rate on capital gains, doubling the capital gains tax rate on the super wealthy.”
Will Healthcare Ever Change?
As the population continues to grow and the gap between rich and poor only widens, it is clear that our current system may not be realistic. According to a study by Yale University, the current system will cost Americans over $50T in the next 10 years. It is imperative that we continue the healthcare discussion, especially in the face of the COVID-19 pandemic, but where it leads to, only time will tell.