When it comes to health care, it’s possible that the U.S. can have it all: a system in which universal coverage is affordable in a free market where carriers and brokers compete for business.
That was the word from Avik Roy, who calls his plan Medicare Advantage for All. Roy is one of the founders of The Foundation for Research and Equal Opportunity, a nonprofit, nonpartisan think tank that conducts original research on expanding economic opportunities. He is the author of the health reform plan, Medicare Advantage for All: A Patient-Centered Plan for Universal Coverage and Permanent Fiscal Solvency.
Roy spoke at today’s NAHU virtual Capitol Conference on his vision for what he calls “the price transparency revolution.”
The rising costs of health care, hospital care and prescription drugs are what Roy called “the single biggest threat to the living standards of every American.” He said employer-based plans have failed to control costs while hospitals raise prices to private insurers. Meanwhile, federal spending on health care continues to rise while federal spending on everything else has remained constant.
Many Americans believe universal coverage is the same as a single-payer health care system, Roy said, but that’s not true. He cited Germany and Switzerland as examples of nations where universal coverage is in place but consumers buy their coverage through private insurers.
“We don’t have to have a tradeoff where people can’t afford coverage and we can have a free market where carriers and brokers compete for business,” he said.
Under the Swiss model, which Roy called Medicare Advantage for All, carriers compete for consumers’ business, just as Medicare Advantage customers buy their coverage from private carriers. “Under this system, there is no public option, no government-run insurance – only private insurers that compete with each other and everyone has to pick their own plan.”
Universal coverage would be provided through regulated insurance products similar to Medicare parts C and D, and products that currently are offered on the Affordable Care Act exchanges. A sliding scale of subsidies would phase out up the income scale, with subsidized coverage available only for those in the lowest 20% of income level.
Insurers would compete on price, and could band together to negotiate prices with hospitals and other providers.
Roy listed four core principles of Medicare Advantage for All.
- Affordable for every generation. Universal overage for today’s Americans and a fiscally sustainable system for future generations.
- Personalized insurance. All Americans should have the freedom to choose among a wide variety of private plans that suit their needs.
- Fairness to taxpayers. We should reserve taxpayer-funded subsidies for the poor, the sick and the vulnerable – not the wealthy.
- Innovation and competition for patients. Enabling competition and curtailing monopolies will lower patient costs and increase innovation.
He described four steps in achieving Medicare Advantage for All.
- Strengthen individual insurance. Expand choice and reduce premiums in ACA exchange through regulatory reform and reinsurance.
- Reduce health care prices. Implement prescription drug price reform and curtail the power of hospital monopolies.
- Medicare and Medicaid reform. Improve Medicare Advantage, eliminate Medicare eligibility for the wealthiest Americans, and integrate Medicaid enrollees into the individual market.
- Other ideas. Implement digital health reform, reform the veterans’ health system, reform the medical malpractice system.
The result, Roy said, would be universal coverage and fiscal sustainability. Health care entitlements would see permanent stability and solvency from the following:
- Deficit reduction of more than $8 trillion over 30 years.
- Reduction in net federal and state tax revenues.
- Medicare Trust Fund would be permanently solvent.
- Medicaid reform would lead to improved state fiscal stability.
Susan Rupe is managing editor for InsuranceNewsNet. She formerly served as communications director for an insurance agents' association and was an award-winning newspaper reporter and editor. Contact her at [email protected]. Follow her on Twitter @INNsusan.
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