Medicare for All Would Crowd Out Private Coverage

The Obama health plan envisions an alternative to employer-based health insurance, called a health insurance Exchange. Premiums would be community-rated, people could choose a new plan once a year and the out-of-pocket premium would be limited to be no more than, say, 10% of income.

Some Democrats in Congress insist that one of the options offered in the Exchange be a public plan (e.g., Medicare for nonseniors). A Lewin Group report estimates that 32 million people would lose their private coverage and enroll in the public plan if it paid Medicare-level reimbursements and eligibility were limited to the small firms, self-employed and individuals.  The number of people dropping private coverage and enrolling in the public plan would increase to 119 million people if eligibility were open to everyone.

Comments (6)

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  1. Bret says:

    Devon, you are surprised? Crowding out the private sector is the whole idea.

  2. Bruce says:

    Most of the Democrats in Congress believe in a single payer system, i.e., national health insurance — what we used to call socialized medicine. So obviously they would like to see everybody in one government plan.

  3. Bart says:

    Given the strong possibility that Democrats will succeed in passing a health package, might it not be worthwhile to rank the likely components of said package according to desirability/undesirability? This might eventually be useful in terms of “picking our battles” if a general holding action becomes impossible.

  4. Richard says:

    The Senate Republican Party Committee has produced a good summary of the case against government-run, “public” health insurance plans competing against private health care plans:

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