Here’s what Bernie Sanders’ ‘Medicare for All’ proposal actually says

The first thing to note is that Sanders’ proposal has only 14 co-sponsors in the Senate. That’s not even a majority of Democrats. That’s less than a third of the 60 votes usually required to overcome a filibuster and pass major legislation, although he has said he would use budget rules to maneuver around the practice of the filibuster in order to get Medicare for All passed.

In Sanders’ proposal, everyone who is a US resident, including undocumented immigrants, gets coverage. That would be a likely point of contention with this plan. There is a prohibition on traveling to the US for free medical care.

Medicare for All is meant to be an extremely egalitarian proposal in which everyone has access to any provider. That’s certainly not the current system in the US, in which there are extreme differences based on the quality of a patient’s insurance and wealth.

This is a general nondiscrimination statement except it includes the language “including termination of pregnancy.” The issue of how the federal government should (or should not) provide access to abortion nearly sank passage of the Affordable Care Act in 2009 and 2010. Here Sanders appears to go in the opposite direction and enshrine abortion rights in the language.

The bill also says the health and human services secretary will lay out a system by which claims of discrimination should be adjudicated and that courts can grant damages.

Americans would be automatically enrolled for benefits at birth or when they move to the US. A subsequent section describes a Universal Medicare Card.

Sanders envisions a four-year transition period. Children under 19 would get universal coverage one year after the bill is signed into law. Everyone else would have the option of keeping their current coverage during the transition or of buying into Medicare or a transitional public plan. Four years to transition from a mostly private system to an entirely public one would be a quick pace. Automatic enrollment is also a departure from the current Medicare system. There would be no precedent for administering this kind of federal program in the US.

This is the most controversial element of this bill. Sanders would make it illegal to sell private health insurance that covers the benefits offered by Medicare for All. This provision would certainly be subject to lawsuits. A subsequent section says additional benefits not covered by Medicare for All (cosmetic surgery, for instance) could be covered by a supplemental insurance plan.

This is the nationalization of an industry in an unprecedented way. It’s important to note here that about one-third of the American seniors who currently get Medicare get it through private Medicare Advantage plans offered by health insurance companies. Those plans would go away.

There is a generous list of covered health, vision and dental benefits, and some long-term care benefits including:

The HHS secretary would be in charge of regularly recommending improvements and adjustments to the benefits package for Congress to consider. States can offer their residents supplementary benefits, but can’t offer their own version of Medicare for All benefits.

People who get Medicare for All would not pay for any part of their health care except, in some cases, up to $200 for prescription drugs for individuals making more than $25,200 annually or families of four making more than $52,400 (200% of the federal poverty level in 2020). The average cost of drugs per person per year in the US is currently more than $1,000 for drugs bought at pharmacies, but the average out-of-pocket spending per person is only $144. However, the current costs are concentrated more on some people than others. This would spread those costs.

The HHS secretary has a lot of power in this plan to determine what is covered, including what experimental and new services are covered. Currently, for people with private health insurance, those determinations are made by insurance companies.

Sanders changed his plan in 2019 to include home- and community-based long-term care after lobbying by disability rights groups and to come more in line with a single-payer insurance plan put forward by progressives in the House. But this portion of his proposal, which stretches over multiple pages, would rely on a state plan to provide institutional long-term care services. Separately, he gives states the ability to set their own standards under Medicare for All as long as they are not less generous than the federal system.

Sanders promises Americans access to the doctors they currently see and more. But his system assumes that doctors will take part. Just as many doctors do not take part in the current Medicare and insurance systems, some would likely sidestep the government program and seek payment on a fee-for-service basis outside Medicare for All.

While providers would have protections under the plan, they would also have responsibilities. And it is an either-or scenario. Either they enroll as a Medicare for All provider or they go outside the system.

The bill does specifically envision private agreements — not insurance — between individuals and providers or groups of providers outside of Medicare for All. But providers, once they enter into such agreements, cannot participate in the government program for a year.

This would be a massive new federal bureaucracy, replacing, by some estimates, 2 million US insurance and health industry jobs. Setting up, enforcing and evolving a health care system for about 320 million people and transitioning more than 200 million from a private system to a public one would be a gargantuan undertaking. Sanders’ proposal imagines a regional administration system that would coordinate individual states and filter up to the HHS secretary, who would be in charge of setting policies. An official ombudsman would collect and hear grievances.

When the federal government takes over trillions of dollars in spending, there is a real danger of waste, fraud and abuse. Sanders envisions applying existing protections that govern Medicaid funding to protect this Medicare for All investment. There are also sections that mandate the creation of an annual health care budget and a focus on cost containment.

A key selling point of a single-payer system is that the government can keep costs down by setting prices to pay doctors, hospitals and drug companies. It’s also why the industries will fight this tooth and nail. It would almost definitely set lower payments to doctors and hospitals than private insurers. More on that in a moment.

By replacing the entire health insurance industry, the government could displace 2 million workers, according to some estimates. Some of those would find jobs in the new government systems. Others could be eligible for up to five years of temporary assistance.

Coronavirus? Hurricane? Earthquake. The government should be prepared.

One fact of US health care is that American doctors make more money than their counterparts in other countries. There are many reasons for that, but one clear way to contain the cost of health care is to contain the amount doctors are paid. Granted, they should have a much simpler time being reimbursed under a single-payer system and more of their time will be spent treating patients. But their bottom lines might also shrink. That’s one reason some doctors could opt out. Hospitals too. In the current system, private insurance pays higher rates to hospitals and doctors than Medicare and Medicaid do.

The federal government would take a much bigger role in assessing the landscape of educating doctors and determining how many specialists are needed in a given field. The US currently has a system that prioritizes specialization over general medicine. And that’s not saving anyone money.

Drug companies are going to fight this with all their might (and they have a lot of money). Instead of setting a price in the market for a drug, they’d have fewer people to negotiate with and may have to accept what the government gives them. It’s no coincidence that Americans pay a lot more for the same prescription drugs than people in countries with single-payer systems. So, yes, this would remove some of the profit motive of the pharmaceutical industry. On the other hand, it’s not at all an agreed-upon fact that drug companies should be able to charge exorbitant prices for lifesaving drugs.

This is a massive new program and paying for it isn’t going to be easy. Sanders has plenty of ideas, however. For starters, everything that goes into the Medicare trust fund would now go into this new, larger fund. So would money that now goes toward the health care of veterans and pays states to provide Medicaid.

The federal government gives tax breaks to employers for providing health insurance. With those benefits now outlawed, the savings in tax breaks would go into the trust fund.

But it’s certainly not clear how the numbers would add up. Sanders has proposed a menu of options to offset the costs of this program. They are not all outlined in this text. The dollars and cents of this are less important to Sanders than the moral imperative. Here’s a look at Sanders’ math.

There are many pages of this bill that deal with sunsetting the bramble of ways the US government currently helps Americans with health care — Medicare, Obamacare, Tricare, federal employee benefits and more — and unifying them in this new plan.

During the four years during which Sanders envisions the Medicare for All system being set up, there is a rolling admission to traditional Medicare, with its low premiums, starting with 55-year-olds in the first year after the law is passed, 45-year-olds in the second and 35-year-olds in the third.

There would similarly be a public health insurance option offered on the individual market for those not yet qualified for Medicare.

The rest of the bill concerns this transition period. It zeroes out some Medicare premiums during that period and accounts for subsidies some Americans get under Obamacare.

But the meat of the bill is what happens after the federal government begins to pay for every American’s health insurance.