The Cost of Being Healthy

By Patrick F. Cannon

Insurance companies do not pay for health care. The Federal Government does not pay for health care. We – you and me – pay for the nation’s health care, along with the stockholders and members of corporations and associations.

I’m always amused when politicians talk about free health care. I have Medicare coverage now. For it, and a supplemental policy, my wife and I pay $11,184 a year in premiums. Before we retired, we paid about 1.5 percent of our income in Medicare withholding tax. These, by the way, are just basic costs; out-of-pocket expenditures are not included.

Although it’s constantly increasing, it was estimated that the total cost of health care in the United States was $3.65 trillion in 2019. The latest per capita figures I could find were for 2017, when the US spent $10,224. The next highest amount was in Switzerland, with $8,009. The average for developed countries was $5,280. Administrative costs in the US were approximately 8-percent, as opposed to from one- to three-percent in comparable countries. Finally, before I bore you to tears, the average physician here makes $218,173 per year; the next highest is Germany, with $150,000.

While the breakdown can vary slightly year to year, private health insurance pays 34-percent of the total healthcare bill. Medicare has a 20-percent share; and Medicaid, 17 percent. Other sources, including out-of-pocket, make up the balance.

Were we to go to a single payer system – i.e., “Medicare for All” – presumably reliable sources tell us that one trillion dollars a year would be added to a Federal deficit that is already running at that level. Politicians like Bernie Sanders don’t see a problem here. You simply tax the rich. In this, he has been remarkably consistent throughout his career. He is on record as believing that there should be no such thing as a billionaire. And as a committed Marxist, he has been perfectly happy to ignore its long and persistent history of failure.

Here’s what I think. Except for some pockets in rural America, we have the finest health care in the world, as I have recently personally experienced. Nothing we do to “reform” it should jeopardize that. It’s also clear that we cannot trust the current political parties to solve the health care funding problem, since they have been obviously unable to agree on ways to even fund the government we currently have. The Republicans, who once could be counted upon to at least try to hold the line on spending, are now as profligate as the Democrats. Indeed, they lowered taxes just when tax revenues from a growing economy might have significantly lowered deficits.

We have smart people in this country, experts in health care and economics who could study the problem in detail and devise a system that would provide a high level of care at a cost the country would be willing to pay. None of these people are politicians. As reluctant as I am to turn over the government to experts, in this case I believe that only a non-partisan commission would be able to study the problem in detail and recommend a way forward.

What we have now is a Republican Party whose only idea is to repeal Obamacare; and a Democratic Party whose increasingly radical base thinks only of a Federal government-run single-payer system, funded by the rich. I frankly don’t know what a workable system would look like, except I’m certain it’s neither of those. It’s perhaps a vain hope, but what this country really needs is a new political party, which I would name the Pragmatic Party. The current failed ideologies of the right and left will not solve any of our problems.

Copyright 2020, Patrick F. Cannon