Bernie Sanders is about to propose the next logical step in the evolution of American healthcare. The theme is “Medicare for all,” it directly addresses the two times higher cost of healthcare in the US, and the Bill consolidates the patch-work quilt of healthcare programs that dominate America while addressing the high cost of pharmaceuticals in our nation.
Medicare is a public / private program meaning that the Federal Government contracts to health insurance companies the processing of policies, claims, and reimbursements. As such the industry is quite large according to the Insurance Industry Institute. Here is what they report:
- Insurance carriers and related activities contributed $450.3 billion, or 2.6 percent, of U.S. gross domestic product in 2014, according to the U.S. Bureau of Economic Analysis.
- The U.S. insurance industry employed 2.6 million people in 2016, according to the U.S. Department of Labor. Of those, 1.5 million worked for insurance companies, including life and health insurers (811,900 workers), P/C insurers (648,200 workers) and reinsurers (25,000 workers). The remaining 1.1 million people worked for insurance agencies, brokers and other insurance-related enterprises.
- Total P/C cash and invested assets were $1.5 trillion in 2015, according to S&P Global Market Intelligence. L/H cash and invested assets totaled $3.7 trillion in 2015. The total of cash and invested assets for both sectors was $5.2 trillion. The majority of these assets were in bonds (62 percent of P/C assets and 74 percent of L/H assets).
The fear of the insurance carriers is that the Sander’s Bill sets the stage for a future when government can self-insure thus saving the profit margin in the national budget. Given the advances in automation and Artificial intelligence this is not an irrational concern.
The failure of the GOP to sponsor a solution to replace the ACA (Obama-Care) has created a need and a vacuum to be filled and Bernie’s Bill purports to do that.
As Senators look at the options, poll their Districts, and obtain feedback, a shift in support of the concept of Bernie’s Bill is growing. I say “the concept” because like all legislation the devil lies in the details.
People of both parties are closely watching developments; while education, communication, and compromise will be needed to get something all can agree upon.