Senator Bernie Sanders recently introduced his Medicare for All Act that aspires to create a national single-payer health system. Healthcare as a universal human right is among the largest of pillars in his “Democratic Socialist” ideology and in an Op-Ed in the New York Times he urged a joining of “the rest of the industrialized world [to] guarantee comprehensive healthcare to every person.” In the piece, he expresses concern for the 28 million Americans who remain uninsured and frustration with a system that “is not designed to provide quality care to all…but to provide huge profits to the medical-industrial complex.”
In 2015, the United States spent almost $10,000 per person for healthcare, whereas the Canadians, Germans, French, and British, spent less than half that whilst also providing healthcare to all. He points out that the reason for these high prices is partly that the United States is “the only major country not to negotiate drug prices with the pharmaceutical industry.” As a solution to these issues, Sanders is proposing the expansion of the current Medicare system, currently only for citizens above 65 years old, to cover all Americans. Sanders introduced the plan with co-sponsorship from fifteen other Democrats, including potential 2020 presidential candidate Elizabeth Warren. Although Sanders knows the bill will not pass, his introduction of the bill marks a notable shift in Democrat ideology further towards the left. Hillary Clinton, for example, has bashed the idea of single-payer health care saying she, “never really seriously considered it.”
In a perfect world, Health Care should undoubtedly be a universal right for which every person has access. However, on the road to achieving that dream, one should not forget the advantages the free market system provides to further medical innovation.
Proponents of Sanders’ legislation argue that the current system’s main issues stem from being tied to companies operating to only to turn a profit. From his point of view, without government intervention, health care costs will continue to rise because the system “is designed to maximize profits for big insurance companies”. Within Sanders’ plan is negotiation with health care providers to place price controls on medical needs. He observes a successful and popular government-run Medicare system providing good coverage to seniors. Thus, he wishes to extend this successful policy to all Americans. Sanders offered several ways of paying for the expensive plan, including raising income and corporate taxes. The Vermont Senator believes that savings from premiums and out-of-pocket costs would offset those increases. As other countries have successfully implemented a similar system, the United States could as well.
In a perfect world, Health Care should undoubtedly be a service every person has access to. However, on the road to achieving that dream, one should not forget the advantages the free market system provides to further medical innovation. Foreigners come to the United States for treatment because the free market system provides the newest and most effective technologies. The approval process through the FDA takes several expensive years, and after introduction into markets, the companies who make the drug only control the patent for a certain number of years. The current patent length is 20 years from the filing date but the average time it takes for a drug to receive FDA approval is 12 years and costs an exorbitant average of $1.3 billion. Pharmaceutical companies only have eight years to earn back the money spent on producing the drug before it goes generic and competitors enter the market, driving down the price.
However, America is blessed to have access to the newest and most effective technologies because they are created within the country. While having uninsured citizens is morally tragic and needs to be rectified, preventing medical innovation that saves millions of lives currently and millions of future lives through price controls is arguably worse
Nonetheless, even with this laborious process, America still is the world leader in producing life saving and innovative medicines. If pharmaceutical companies went through the same process but then had to agree to a price set by the Government there would be much less incentive to produce new drugs. It is easy to see high medical prices and conclude the marketplace necessitates price controls; however, one must also understand why the prices are as high as they are. These prices are attributable to overregulation by the FDA and high initial production costs. Furthermore, an increase in corporate tax to pay for Sanders’ legislation is only going to prevent pharmaceutical companies from repatriating their overseas profits and then reinvesting those profits into innovation.
Legislators should understand the importance of all citizens having access to health care, but citizens should not forget about the good that the current system does for the United States and the rest of the world. While there is no doubt that the extreme expense of medical treatment should be addressed, increasing Government control of healthcare is also going to increase expense in the form of debt. However, America is blessed to have access to the newest and most effective technologies because they are created within the country. While having uninsured citizens is morally tragic and needs to be rectified, preventing medical innovation that saves millions of lives currently and millions of future lives through price controls is arguably worse. Single-payer health care should exist in the sphere of debate but currently, 65% of Americans are happy with their health care. In addition, the backbone of the current system is employer-provided insurance which Sanders’ plan would end. Employer-provided insurance is both high quality and affordable because companies must offer a quality plan or else they will not receive the labor necessary to run the business as the potential employee will choose to work elsewhere. This coverage is the result of a free market system.
When looking at the future of healthcare being progressive is smart. However, Sanders’ plan has the potential to actually be regressive and should be scrutinized. Instead of an increased government role in health care, the opposite should be looked at as well.