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Critiques of Single-payer: Why Did They Take So Long to Discover?

Wednesday, July 3, 2019 20:10

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It is now routine for Democrats to be asked in town halls, debates, etc. “Who here would abolish their private health insurance in favor of a government-run plan?“ But why did it take so long to pose this question to advocates of “single-payer” health systems?

As a matter of economics, it should be obvious that the health insurance market would not be served by a single seller unless there were tremendous barriers to entry. E.g., criminalizing any private enterprise that attempts to sell or otherwise provide health insurance. Without stark penalties, regardless of the details of government plans, there would be gains from trade between private insurers and at least a small segment of consumers if not more. With private insurers, the market is no longer “single payer” (as long as “single” refers to “one”).

For this reason, bills in Congress proposing to transform the U.S. market into single payer outlaw private health insurance. Take Senator Bernie Sanders 2013 (sic) American Health Security Act’s “enactment of a Medicare-for-All Single Payer Health Care System” by “Requir[ing] each state health security program to prohibit the sale of health insurance in that state….“

Why didn’t Mrs. Clinton ever raise this point when Senator Sanders was campaigning against her for the 2016 Democratic nomination?

Why didn’t Joe Crowley raise this point when campaigning against AOC in 2018?

One possible answer is overconfidence in victory. But overconfidence did not stop Clinton supporters from calling Sanders a socialist during the 2016 primary, or Clinton positioning herself as a defender of capitalism. Why not make it more concrete to regular people and alert the 180 million consumers of private health insurance that their product would become illegal?

I think part of the answer is that few people actually read the single-payer bills in Congress (I observed the same with the “stimulus” law and with the ACA) or think through the economics of how single payer can operate even in principle.

From the first day I arrived at White House CEA, I told anyone who would listen: “Medicare for All bills in Congress will outlaw the sale of private health insurance and outlaw the provision of health insurance as part of employment.” They thought I was kidding. Because capable politicians do not give such gifts to their opponents, what I said could not be true. I began carrying the relevant bill sections in my jacket pocket for the benefit of the doubting Thomases; only after that did the President’s speeches (which are preread by EOP staff) begin to include the disturbing and incredible truths about “Medicare for All” (an earlier alarm bell was here).

(Medicare for All bills also adhere remarkably closely to Marxist theory, but that is primarily of academic interest so I will post on it later.)

Source: http://caseymulligan.blogspot.com/2019/07/critiques-of-single-payer-why-did-they.html

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