NO ADVERTISING, GOVERNMENT OR CORPORATE FUNDING

  • Latest News
  • Pitch a Story
  • Work with a Journalist
  • Join the Blog Squad
  • Afghanistan
  • Africa
  • Asia
  • Baltimore
  • Canada
  • Egypt
  • Europe
  • Latin America
  • Middle East
  • Russia
  • Economy
  • Environment
  • Health Care
  • Military
  • Occupy
  • Organize This
  • Reality Asserts Itself
  • US Politics
  • How to Pay for Single Payer Health Insurance


    Gerald Friedman Pt 3 of "What a Single Payer Health Insurance Plan Looks Like" -   August 9, 12
    Members don't see ads. If you are a member, and you're seeing this appeal, click here

    Audio

    Share to Facebook Share to Twitter




    I’ve made my way to my current internet haven: The Real News Network (TRNN). - Caroline Lewis
    Log in and tell us why you support TRNN

    Bio

    Gerald Friedman is a Professor of Economics at the University of Massachusetts Amherst and a member of its Political Economy Research Institute (PERI).

    Transcript

    How to Pay for Single Payer Health InsurancePAUL JAY, SENIOR EDITOR, TRNN: Welcome to The Real News Network. I'm Paul Jay in Baltimore.

    This is a continuation of our series of interviews looking at single-payer or government-run health insurance plan and focusing particularly on Maryland. And as I said, I'm in Baltimore, and I guess I should have said earlier in this series of interviews that I guess we have some kind of conflict of interest here because we live in Maryland and if there was a single payer plan system, I guess we would benefit from it. Oh, we're ordinary people. We would benefit from this. Oh, terrible thing, isn't that? Okay.

    So now we're going to continue our series of interview, and now joining us again is Gerald Friedman. Gerald is a professor of economics at the University of Massachusetts Amherst. And we're—if you haven't watched part ones and two and—I can't remember. Are we three or four now? Anyway, you'll see all the other parts down below this video player.

    So thanks for joining us again, Gerald.

    GERALD FRIEDMAN, PROF. ECONOMICS, UMASS AMHERST: Thank you.

    JAY: Alright. So in the last segment, we went through your report and we looked at the savings, which came to just over 24 percent over existing insurance coverage and health care expenditure. But that doesn't cover everything, does it? And then so what isn't paid for out of these cost savings, and how are you going to pay for it?

    FRIEDMAN: Okay. Well, first of all, the cost savings are there. There are also extra expenses, as we were saying, with the Medicaid rate fix. Also, we would be covering everybody. Now 15 percent of the population of Maryland is currently without health insurance. Extend health insurance to them, they're extra expenses. Also, the plan for the Maryland Health Security Act does away with copayments, deductibles, and all of those expenses. We expect that people would use health services more.

    JAY: And let me just—I may not have made this clear enough in the earlier segments, or I may have missed in one of the segment, but this Maryland Health Security Act is an actual piece of legislation. It's been proposed in the Maryland assembly. It's not been passed yet, and this debate is sort of going on. Okay, go on, Gerald.

    FRIEDMAN: Okay. Yeah. Yeah. The study I did projects that it would be enacted this year and looks at the savings and expenses for next year. And as I said, covering everybody, doing away with copayments would lead to greater utilization of health care. That's a good thing. You know. So, you know, people would be healthier. They would live longer. They would be more productive. They wouldn't be sick as much, so they wouldn't miss as much work. Kids would be healthier in school and would do better.

    JAY: And if I understand correctly, infant mortality amongst the poor in Maryland is actually getting worse.

    FRIEDMAN: Yes. Yes. It's really quite appalling. Overall the United States is about 45th in the world in life expectancy and infant mortality. With one of the richest countries in the world, how is it that we've gotten to a position where we've gone from second or third in the world 35, 40 years ago to 45th? We're obviously doing something wrong. We're putting tons of money inefficiently into the health care system. So fixing that would involve spending some extra money.

    Now, even taking account of those extra costs, there would be savings of billions of dollars for Maryland. But we'd also be reallocating what we're spending. Much of the spending now comes through premium dollars paid by individuals or companies. We would do away with those. There would be no private insurance. You wouldn't be buying private insurance. Instead, that bill for that, for what used to be paid for by the private insurance, would be picked up by the government, by this health security trust, which would be funded through taxes.

    JAY: Where I—you know, I still spend a lot of my time and grew up in Ontario. Yeah, you pay your taxes, you get a health card, you go see the doctor. And it's a progressive tax system, so that people that are richer pay a little more—or, hopefully, a lot more, one wishes.

    FRIEDMAN: That's right. And, in fact, what we've proposed here would be we would use payroll taxes and progressive income taxes to pay for the health insurance plan. What happens now is if you have health insurance, you buy it yourself or you pay for it through work. A certain fixed amount gets paid for everybody. And that is a trivial amount for the heads of large companies but is a very large amount for people who are earning minimum wage or something close to it. So what happens now is poor people and working people pay a very high proportion of their earnings for health coverage. We would switch that by taking a percentage of people's payroll and then a percentage of your earnings. We would be taxing the rich more than the poor. It would be a little bit progressive. But compared to the current system, it would be a huge gain for working people and certain loss for people at the very highest income.

    JAY: And what would it mean for businesses? One of the arguments that's often given against this is that it would make, for example, Maryland uncompetitive compared to other states that don't have this.

    FRIEDMAN: I so want to go to chambers of commerce and to businesses and talk to them about what a great savings this is for them. This is the best thing that could happen for Maryland business that the Maryland state government could do, because, first of all, businesses would get this off their to-do list. Small businesses around Amherst that I talk to, they hate having to do health insurance. They feel obligated to provide health insurance to their workers, they've been providing it, they have to keep providing it, but dealing with it is a gigantic hassle. Also, it's a big expense. And it's an unknown expense. Every year you find out, oh my God, my insurance premiums are going to go like this.

    We would take care of that. It would be handled every year by the state. It would be—you wouldn't have to think about it. You wouldn't have to explain to your worker why this thing is or is not covered. Also, because it would be more efficient—remember the 24 percent savings—because it would be more efficient, Maryland would be able to provide health care to its population at lower cost than their businesses are paying now. Businesses in Maryland would save several percentage points of payroll every year because of this, because of the single-payer system.

    JAY: Yeah. If people want some evidence of this, they should go look at—one of the biggest supporters of the Ontario health care plan was General Motors, which found that their costs towards health care and their costs per employee in Ontario was far lower than it was, like, for example, in Windsor, right across the border in Detroit. And General Motors was very much in favor of this kind of system.

    FRIEDMAN: That's right, because it's saving them money. And I would expect that businesses in Maryland, when they realize how much they'd be saving and how they would be able to outcompete businesses in Virginia or Pennsylvania—. I mean, a restaurant in Maryland would be less expensive to operate than a restaurant across the border in D.C. or in Virginia.

    JAY: Well, one of the arguments will be is that there's a lot of businesses that don't provide health care at all, and they will become less competitive if all of a sudden they have to start making some payments towards this plan.

    FRIEDMAN: That's right. That's right. Small businesses and some large businesses don't provide health care. Now their workers are getting free care, are getting Medicaid, are getting some sort of subsidized care, and their workers are not getting care at all and are being unhealthy and sick. They would benefit if their employees were healthier and had a more reliable source of care. On the other hand, they would be paying somewhat more in the payroll tax than they're paying now.

    JAY: But in your study you looked at the overall jobs effect. What did you find?

    FRIEDMAN: Oh, the overall jobs? Maryland would benefit. It's a little hard to say exactly, but I would estimate over 100,000 additional jobs would be created by this because of this competitive interstate effect, that Maryland employers would be able to outcompete employers in Pennsylvania and Virginia and elsewhere.

    Probably some businesses would move to Maryland. You know, if you're in Northern Virginia, hey, locate in Montgomery County, get the cheaper health insurance. Your life is easier and it's cheaper. So you'd get maybe 100,000 extra jobs.

    And also, though I didn't put this in, I didn't factor this in, if you actually did get those 100,000 extra jobs, the tax rate could be lower for health care. So that would—the effects would become more [crosstalk]

    JAY: Because the bigger the pool, the more economy of scale.

    FRIEDMAN: Yes, exactly. Exactly. Costs become lower and you get on this virtuous cycle.

    The biggest beneficiaries would be employers who are currently providing health care, and the biggest group there are local governments, because local governments not only provide health care to their workers, but they provide health care to their dependents. What I found was the so-called pickup rate, the proportion of people actually using the health insurance that's offered, it's only about 60 percent of private employers, but it's over 90 percent for public employers. So local governments would be benefiting even more, which would mean lower taxes.

    JAY: Okay. So this whole thing's a no-brainer. I mean, if you look at the data, it's really a no-brainer. And, you know, as someone who, again, grew up in Canada, we always shook our heads and just could not understand how Americans can live with the system they have. But what are the politics of this in Maryland now? What do you get a sense of? Is there support for this? And what's the role of the insurance companies?

    FRIEDMAN: Well, what I hear in Maryland, what I hear in other places as well, is politicians saying, yes, yes, you're right, this has been studied before. I'm not the first one to find these sorts of savings. And we'll get there eventually, but we need incremental steps. And right now the major focus is on working out how to implement the Affordable Care Act, which is a little bit of a step towards universal coverage and single-payer, but it's a small step in that direction.

    What I think will happen in the next couple of years is people are going to learn that the Affordable Care Act covers a lot of people; it doesn't cover everybody, so it doesn't provide the universal coverage that we want, and it doesn't control costs, which is something that the people involved in writing the Affordable Care Act admitted. You know, they have a lot of things in there that they hope will maybe help control costs, but it's not expected to control costs very much, with the result that the share of income going to health insurance and health care is going to keep on rising. We'll still have the private insurers with a rising administrative burden, and in five years were going to be back where we are now, except instead of 17 percent of our income going to health care, it will be 25 percent.

    JAY: And one of the points you make in your paper is that one way or the other these costs are going to have to be contained. So if you're not getting this out of the private insurance plan, you're going to have to get it by not providing as much health care.

    FRIEDMAN: Yes, which is the point we're getting to in Massachusetts, where there's talk about ways to cut back on health care. A lot of the talk about consumer-driven health care is basically how can we get people to stop asking for health care. As it is, Americans go to the doctor and go to dentists less often than people in other countries. We're less healthy. We go to the doctor less often. I mean, it's like, put the two together and it starts to make sense.

    But it's—we're already underserved as a population, and we will be in a worse position in several years, spending more, getting worse service. And I think at that point a lot of the people who have been looking for incremental gains will say we've got to go all out.

    JAY: Okay. And we're going to—you'll find below this video player a link to Gerald's report, and it's worth looking at the detail of this, because it's about time we had this discussion based on public policy with research and not just some rhetoric in either direction.

    Thanks very much for joining us, Gerald.

    FRIEDMAN: Thank you. Bye-bye.

    JAY: And thank you for joining us on The Real News Network. And don't forget there's a "Donate" button over here, and if you don't click on that, we can't do this.

    End

    DISCLAIMER: Please note that transcripts for The Real News Network are typed from a recording of the program. TRNN cannot guarantee their complete accuracy.


    More Info


    Comments

    Our automatic spam filter blocks comments with multiple links and multiple users using the same IP address. Please make thoughtful comments with minimal links using only one user name. If you think your comment has been mistakenly removed please email us at contact@therealnews.com

    Comments


    Latest Stories


    University Sit-In Targets World's Largest Private Coal Company
    The Modern History of Venezuela and the Need for a Post-Oil Economy - Edgardo Lander on RAI (6/9)
    Can Johns Hopkins Afford to Pay A Living Wage? (1/2)
    One Percent of Environmentalists Killings Lead to Convictions
    Investigation Finds Former Ukraine President Not Responsible For Sniper Attack on Protestors
    The Modern History of Venezuela from 1973 to the Caracazo Massacre - Edgardo Lander on Reality Asserts Itself (3/9)
    Ukraine Transitional Gov't Moves Militarily To Reclaim Seized Buildings
    IPCC Report Flawed By Narrow Focus on Carbon Emissions
    The Modern History of Venezuela: The Bolivarian Revolution - Edgardo Lander on Reality Asserts Itself (5/9)
    Obama Signs Directives to Reduce the Gender Wage Gap
    Eastern Ukraine Lacks Political Representation in Kiev
    Demystifying the Role of Mitigation in the Most Recent IPCC Report
    Hypersurveillance State Won't Prevent Another Boston Marathon Bombing
    The Modern History of Venezuela from 1973 to the Caracazo Massacre - Edgardo Lander on Reality Asserts Itself (3/9)
    Univ. of Maine Faculty Reinstated After Students Protest Against Cuts
    The Modern History of Venezuela from 1908 to 1973 - Edgardo Lander on Reality Asserts Itself (2/9)
    IMF Will Address Global Inequality, Says Managing Director Christine Lagarde
    Raising Big Banks' Leverage Ratio Good, But Not Nearly Enough
    TRNN Replay: Austerity Road to 19th Century
    Has Palestinian Maneuvering Revived Peace Talks?
    Late Jackson Mayor Lumumba's Son Wins Primary to Replace His Father, Runoff Election Ahead
    Quebecers Reject PQ and Elect a Liberal Government Representing Big Business
    TRNN Debate: Decriminalization vs. Legalization
    The Beginning of the Chavez Era - Edgardo Lander on Reality Asserts Itself (4/9)
    "Off With His Head": Court Upholds Obama's Power to Kill
    Workers at Nation's Top Hospital Strike For Fair Wages
    From Exile to Radicalization in Venezuela - Edgardo Lander on Reality Asserts Itself (1/9)
    Rwanda 20 Years Later: Genocide, Western Plunder of Congo, and President Kagame
    Ukrainian Protesters in the East Demand More Autonomy From Kiev Government
    Hunger Strikers Demand President Obama Halt His Record 2 Million Deportations
    Indian Parliamentary Elections - A Primer With Vijay Prashad
    West Looks to Carve Up Ukraine & Privatize Industries Held by Kleptocrats
    Where Are Israeli-Palestinian Peace Negotiations Headed?
    The Multiple Kingdoms of Saudi Arabia (5/5)
    Do the Afghan Presidential Elections Signify Progress?
    Republican Presidential Hopefuls Pay Homage to Billionaire Casino Tycoon Sheldon Adelson
    Will Extremist Lieberman Become Israel's Next Prime Minister?
    Why do the Saudis Want the US to Attack Iran? (4/5)
    Immigrant Advocates and Families Tell President Obama 'Not One More'
    Elections, Pipelines, and Protests - The Canada Panel
    Chris Hedges on "Israel's War on American Universities"
    Baltimore Residents Decry Lack of Affordable Housing
    Yellen Talks the Talk But Will She Walk the Walk?
    Hopkins Hospital Workers Speak Out against "Poverty Wages"
    Will Venezuela's New Floating Exchange Rate Curb Inflation?
    The European Central Bank's War on Wages is Pushing Europe's Economy to the Brink
    Supreme Court Decision Opens Floodgates for More Campaign Cash
    Charles Keating, the Financier Behind the Savings and Loan Scandal, Dies at 90
    Saudi Arabia and the al-Qaeda Monster (3/5)
    Maryland Residents Voice Opposition to Natural Gas Fracking Export Facility
    Supreme Court Ruling Gives Wealthy Individuals More Influence Over Elections
    What are the Saudis Afraid Of? - Madawi Al-Rasheed (2/5)
    Baltimore's MICA Adjunct Professors Set to Vote on Unionization
    Boycott of Israel Moving to Next Level?
    Hypocrisy Dressed Up as "Realism" Justifies American Alliance with Saudi Dictatorship
    Immigration Reform in the Shadows of Cesar Chavez's Legacy
    Leaked Senate Report Shows Use of Torture As "Ineffective"
    UN Report Says Climate Change Will Threaten Food Production Worldwide
    The Hypocrisy of US Calling for Enforcement of International Law
    How the Ecuadorian Economy Grew in a Global Recession
    'Shadows of Liberty' Trailer
    Kristina Borjesson on Why CBS Shut Down Her investigation into Flight 800 (2/8)
    Glen Ford on Racism in the American Media (3/8)
    Paul Jay on What Drives Corporate Media and What Drive The Real News (4/8)
    Creating a New Media Paradigm After Citizens United (5/8)
    Should The Left Engage with the Mainstream Media? (6/8)
    What Is the Financial Backing For The Real News? (7/8)
    Standing up to Character Assassination (8/8)
    Oligarchs, Fascists and the People's Protest in Ukraine
    TRNN Debate: Is Obamacare In the Interest of Workers?
    Too-Big-To-Fail Advantage Remains Intact For Big Banks
    Obama and the Saudi Agenda
    TRNN Replay: Investigating the Saudi Government's 9/11 Connection and the Path to Disilliusionment - Sen. Graham on Reality Asserts Itself pt 1
    The Iraq War's Real Legacy
    Petitions with 100,000+ Signatures Call for Snowden's Passport to be Reinstated
    We Need to Harness People Power - Andy Shallal on Reality Asserts Itself (4/4)
    BC Pipeline Fight and Quebec Elections - The Canada Panel
    Jonathan Schell - 1943-2014: Board Member of TRNN on Why We Need The Real News
    Teachers on Strike from the UK to Argentina
    Connecticut Poised to Become First State with $10.10 Minimum Wage
    Oil Spill Threatens Wildlife and Local Economy
    DC School Test Scores Up, But Poor Black Kids Are Doing Worse - Andy Shallal on RAI (3/4)
    Obama's Proposal To End NSA Bulk Data Collection Won't Protect Privacy
    How Google, Apple & The Biggest Tech Companies Colluded to Fix Workers' Wages
    An American Should be One that Questions Their Government - Andy Shallal on RAI (2/4)
    What's Driving Putin & Obama's Posturing on Ukraine?
    Hundreds of Students & Faculty Occupy College Campus to Fight Cuts to Public Higher Ed
    Due Process 'Impossible' In Harsh Death Sentencing Of Over 500 Muslim Brotherhood Members
    Has Anglo-American Capitalism Run Out of Steam?
    Being the "Other" in America - Andy Shallal on Reality Asserts Itself (1/4)
    TRNN Debate: Should Baltimore 'Ban The Box'?
    How Fallujah Became the Iraqi Government's New Battleground
    Why I Decided to Blow the Whistle on the NSA
    NASA Climate Predictions Show Serious Threat To Humanity
    Professor Who Teaches Israel-Palestine Conflict Accuses College of Violating His Academic Freedom
    CIA and NSA Wrongdoing Requires Independent Investigation, Says Former Church Committee Staff
    Are Tuition Breaks Enough To Combat High Student Debt And Low Graduation Rates?
    Industries Across the U.S. Are Stealing Wages From Their Lowest Paid Workers
    Who In Ukraine Will Benefit From An IMF Bailout?
    NSA Recording All International Calls From U.S.
    Israel "Making Lives Miserable" for Africans, Hoping They 'Self-Deport' (2/2)
    BP Gets Green Light to Drill in Gulf, But Has Safety Improved?
    Residents Still Not Drinking Tap Water Two Months After West Virginia Spill (1/2)
    Libya's Descent Into Turmoil Three Years After NATO Intervention
    From Pipelines to Peladeau - Canadian Report
    Israel "Making Lives Miserable" for Africans, Hoping They 'Self-Deport' (1/2)
    Congressional Progressive Caucus Budget Strikes Back Against Austerity
    Libya Three Years Later - Chaos and Partition
    Why Was Gaddafi Overthrown?
    Should Ukraine and West Accept De Facto Crimea Joining Russia? (2/2)
    Tony Benn Saw Socialism as the Culmination of Democratization
    Why Didn't Bush/Cheney Attack Iran and Can Obama Make and Sell a Deal? - Gareth Porter on Reality Asserts Itself (3/3)
    After Late Mayor Lumumba is Laid to Rest, What's Next for Jackson, Mississippi? (2/2)
    Crimea Referendum: Self Determination or Big Power Manipulation? (1/2)
    Sen. Graham: President Must Side with Openness About CIA and 9/11
    Manufacturing a Narrative for War - Gareth Porter on Reality Asserts Itself (2/3)
    Protesters Hit the Streets of Brooklyn to Demand $15 Minimum Wage
    Hammer: 'Moral Bankruptcy' Behind Massive GM Recall
    White House Withholds Thousands of Documents from Senate CIA Probe
    I Grew Up Believing in Time Magazine's Version of America - Gareth Porter on RAI (1/3)
    Western European Banks Vulnerable to Ukrainian Sovereign Debt Crisis
    TRNN Debate: What's Driving Inflation in Venezuela? (2/2)
    CIA vs. Senate: Who Is Obama Protecting?
    Will Tipped Workers Get Excluded Again From Minimum Wage Hike?
    TRNN Debate: What's Driving Inflation in Venezuela? (1/2)
    After Late Mayor Lumumba is Laid to Rest, What's Next for Jackson, Mississippi?(1/2)
    TRNN Replay: A Look at Who's Poised to Become No.2 at the Fed
    How Right-Wing Nationalism Rose to Influence in Ukraine (2/2)
    Netanyahu Attacks Boycott As Campaign Enters New Phase
    Moving Towards a Police State - Michael Ratner on Reality Asserts Itself (7/7)
    Fighting Reagan's Secret, Illegal Wars - Michael Ratner on Reality Asserts Itself (6/7)
    Puerto Rican Independence Movement and Cuba Further Radicalized Me - Michael Ratner on RAI (5/7)
    The Butcher of Attica - Michael Ratner on Reality Asserts Itself (4/7)
    MLK and a Radicalizing Moment in American History - Michael Ratner on Reality Asserts Itself (3/7)

    RealNewsNetwork.com, Real News Network, Real News, Real News For Real People, IWT are trademarks and service marks of IWT.TV inc. "The Real News" is the flagship show of IWT and Real News Network.

    All original content on this site is copyright of The Real News Network.  Click here for more

    Problems with this site? Please let us know

    Linux VPS Hosting by Star Dot Hosting