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OpEdNews Op Eds    H1'ed 3/23/17

The Simple Healthcare Plan for all that Ought to Please Everyone

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From waprogressives.org: Health Care for All {MID-70967}
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On the eve of the great Obamacare repeal, or not, if conservative Republicans get their way, ironically, I thought I would offer my plan to replace Obamacare with something much better than Trumpcare (and it deserves to be called Trumpcare, because without President Trump, this repeal would have gone the way of the several dozen other repeal plans offered by Republicans during the last 8 years, and been vetoed by the president).

Liberals generally want some form of national health insurance that covers most, or all, medical expenses for all Americans. Conservatives want the government to tax and spend less and let Americans choose their own coverage, or even do without if they "choose" to (I put "choose" in quotes because it is never sufficiently explained, to me at least, what the conservative option is for someone who is inadequately covered who gets sick and can't afford health care. Do we let them "die on the street" as president Trump famously said he would not do?). The Koch Brothers promise to fund an opposition candidate to Trump who opposes the current Ryan-Trump endorsed bill to be voted on today (which is changing dramatically even as I write this). They think it doesn't go far enough, and indeed, the Ryan-Trump plan has been called Obamacare 0.5 for its reduction in support but not complete elimination.

However there is another option that reduces, or even eliminates the regressive payroll tax, provides medical coverage for all Americans, allows people to chose their own doctors, and even allows for some form of "premium care" to co-exist as a private supplement to an expanded Medicare-for-all. I'm not talking about Representative John Conyers' Medicare-for-all plan HR676, which, while well-intentioned, will never pass since it imposes more taxes than even the current Obamacare taxes on the rich, plus new taxes on Wall Street trading (a good idea, but not for funding Medicare, but for stopping useless and destructive high-frequency trading and raising revenue for other good things).

Michael Chernew writes in the Health Affairs Blog, "The Economics of Medicaid Expansion" (UPDATE: The original link seems to have stopped working. See this archive link instead: http://cc.bingj.com/cache.aspx?q=money+multiplier+for+medicre&d=4999081626241058&mkt=en-US&setlang=en-US&w=zI15CyfdAQXhUdt447lfPl1GcUIc9h0P):

The Multiplier Effect

Yet the analysis presented above is incomplete. Even in steady state beginning in 2020, the states that do opt to expand receive 90 percent of the funding for Medicaid expansion from the Federal government. Those dollars do not sit idle. They largely support provision of care, and the largest share of that expense is labor. The workers in organizations supported by Medicaid spend the funds on everyday expenses. They eat at restaurants, buy groceries, and go to movies. The businesses who supply those services, many of whom will be in-state entrepreneurs, in turn spend the money on wages and supplies, and the cycle continues.

In economics this process is known as the "multiplier effect." A dollar put into an economy creates more than a dollar of economic activity. The magnitude of that multiplier is again subject to debate, but a reasonable estimate could be between 1.5 and 2.0. Thus after 2020, the 90 cents received from the federal government for each dollar in Medicaid spending translates to between $1.35 and $1.80 in state economic activity (crucially assuming enough slack in the economy to absorb the spending).

Note Chernew was writing about Medicaid, not Medi care. However, the patient populations are similar: neither can afford medical care without a government subsidy (Medicaid) or very few can (Medicare). They tend to be older and/or sicker than the general population. Both are not insured (Medicaid) or under-insured (Medicare) by private insurance.

Note also that the link in this 1-year old article doesn't work, but I was able to find the original PDF report that the article is based upon from the Wayback Machine (the internet never forgets!) here: http://web.archive.org/web/*/http://www.mffh.org/mm/files/MUMedicaidExpansionReport.pdf

The study is only for Missouri, and considers many factors in its analysis.

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Scott Baker is a Managing Editor & The Economics Editor at Opednews, and a blogger for Huffington Post, Daily Kos, and Global Economic Intersection.

His anthology of updated Opednews articles "America is Not Broke" was published by Tayen Lane Publishing (March, 2015) and may be found here:
http://www.americaisnotbroke.net/

Scott is a former President of Common Ground-NYC (http://commongroundnyc.org/), a Geoist/Georgist activist group. He has written dozens of articles for (more...)
 

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