Are you not factoring in getting rid of health insurance companies altogether, and regulating big pharma?
- Health insurance companies have very small profit margins, somewhere around 3%, which is down there with grocery stores; compare that with P&C insurers like AllState and State Farm, who get to 6–7% profit margins. When you add up the cash items that would actually be saved by getting rid of them (mostly profits and executives salaries, as the ACA experience has shown us that you don’t get rid of marketing just because you have a government-run program), I have serious doubts that we’d actually save any money, in that I also assume that the fraud levels of the “Medicare for All” program would be about the same as the current Medicare program, which are assumed to be substantially higher than you find in the private market (although it’s very difficult to quantify those figures, seeing that the government does not like to publish statistics that display their relative incompetence).
- (I have some personal background in this, as I work on analytics consulting projects for private insurers and state health and human services departments. The private insurers are very sophisticated in their use of data science and analytics to root out fraud, while the governments are still pretty much counting on their fingers. Keep in mind that it is the Medicare groups of each state that are responsible for digging out fraud, not the Feds.)
- In addition, I am *terrified* (and you should be too) that the government, taking control of the entire system, would start risk-pricing by political constituency rather than actuarial math; they’ve already put their fingers too deeply into this process in the ACA, with the result being skyrocketing premiums and a low rate of signup by millennial invincibles, who are not keen on the cost of the system being loaded onto their healthy backs, unsurprisingly.
- I am not sure how you expect to regulate “big pharma” to save money. Big Pharma has substantial profit margins, but if you want them to continue to research and develop new drugs at a healthy (pun intended) rate, you can’t really throttle back the money they earn. The reason that new drugs are overpriced are mostly due to intellectual capital regulations, not price gouging on the part of the insurer.