A political party is forced to embrace increasingly extreme and unrealistic policy positions to placate base voters driven by hatred of a sitting president. Upon its return to power, the party finds itself trapped between the widespread unpopularity of those positions and grassroots voters in no mood for compromise.
A description of the Republican Party in 2017? Certainly. If the Democrats are not careful, however, it could apply to them in 2019 or 2021. Inspired by the leadership of Senator Bernie Sanders, a growing number of party activists are making support for “single-payer” health care a litmus test for their support.
Sanders released a new version of his single-payer bill, the Medicare for All Act, in September. The bill was co-sponsored by virtually all of the Democrats’ likely presidential candidates in 2020, including Senators Elizabeth Warren (D-Mass.), Cory Booker (D-N.J.), Kirsten Gillibrand (D-N.Y.), and Kamala Harris (D-Calif.).
But while the broad concept of single payer often polls well, its details (e.g., large tax increases) have often been seen as politically toxic. As Business Insider columnist Josh Barro recently put it: “single payer is the left’s ‘repeal and replace Obamacare.’ Popular mantra, fatal details.”
Although virtually all industrialized countries have some form of national health insurance, the programs vary widely in how they are designed. In Great Britain, for example, the government directly owns and operates the clinics and hospitals and most physicians, nurses, and other health-care workers are public employees. In Germany, by contrast, most physicians are in private practice, hospitals are run as nonprofits, and insurance coverage is provided by a network of more than a thousand “sickness funds.”
Historically, when grassroots activists talked about single payer, they often had the Canadian health-care system in mind. Often thought of as a “national” insurance plan, the Canadian system is moderately decentralized with each province or territory operating its own plan. Each provincial plan must cover a standard package of benefits established by the federal government. While those services are free at the point of service, the provincial plans are not required to cover the cost of prescription drugs, long-term care, or dental and vision services. About two-thirds of Canadians take out private policies to cover the cost of those services and often pay some of the cost out of pocket. As a result, about 30 percent of health-care spending in Canada’s “single-payer” system comes from private sources.
Because the provinces are the single payer for most hospital and physician services, they can exercise a significant degree of control over costs. The provinces engage in a form of collective bargaining with physicians over their fee schedules and provide hospitals with a fixed amount of money to spend. As a result, Canada spends less than half as much on health care per person as the United States does. While Canadians often face longer waits than privately insured Americans for certain types of specialists and procedures, there is little evidence—despite the occasional Fox News horror story—of a negative impact on health outcomes.
A single national-health-insurance plan covering all Americans has been a goal of progressives for almost a century. President Franklin Roosevelt considered including a health-insurance system for the poor in the Social Security Act of 1935, but was concerned that opposition from physicians might doom the entire legislation. His successor, Harry Truman, supported a universal national-health-insurance plan, but lacked a supportive Congress.
By the early 1960s, the significant expansion of employer-based health insurance (spurred by its favorable tax treatment) led many policymakers to look for ways to fill the gaps in that system rather than embrace single payer. President Lyndon Johnson and a heavily Democratic Congress were able to push through Medicare (a federally administered program for those over sixty-five) and Medicaid (which provided federal funding to states so they could operate programs for the very poor). In the 1970s, President Richard Nixon supported requiring employers to provide health insurance to their employees if their employees were willing to pay some of the cost, but the proposal was opposed by many Democrats who favored a more universal approach and objected to the plan’s cost-sharing provisions.
By the 1990s, the rising cost of health insurance and the growing number of uninsured led many single-payer advocates to believe their time had come. Pointing to the relative success of the Canadian system, they argued that adopting a similar model could provide universal coverage while slowing the growth of health-care costs. President Bill Clinton’s proposed Health Security Act, however, embraced a “managed competition” approach, whereby employers and individuals would buy their insurance through large purchasing cooperatives.
In a nod to those who argued that the plethora of overlapping public and private programs led to confusion and excess costs, Clinton tried to bring Medicaid, state and local government plans, and private plans with fewer than five thousand employees into the purchasing cooperatives. The resulting backlash from all those stakeholders was an often unappreciated factor in the bill’s failure. In the end, Clinton, like many of his predecessors, had to accept a small patch to the current system, expanding coverage to uninsured children through a new Children’s Health Insurance Program.
Nor did supporters of single payer fare any better in the Obama administration. Neither Obama nor his Democratic primary opponent Hillary Clinton had much sympathy for it, and Obama’s subsequent bill resembled a system developed in Massachusetts by Republican governor Mitt Romney. Obama’s one concession to single-payer advocates was the inclusion of a “public option,” where a public-health plan would compete alongside private plans. That provision, however, was subsequently dropped during congressional negotiations because of opposition from the insurance industry. Obama, like Clinton, learned that disrupting existing insurance arrangements can be politically dangerous. His famous pledge that “if you like your plan you can keep it” was widely derided after several insurers announced they were terminating plans that were not compliant with the ACA’s coverage requirements.