So far, the era of House Democratic majority doesn’t appear to be off to a propitious start. Nancy Pelosi’s still struggling with a nascent rebellion in her fight to regain the speaker’s gavel, and their biggest issue in the midterms might be about to backfire on them. Politico’s headline takes sides in the Medicare for All fight:
Ah, it’s the “establishment” that’s looking to crush “liberals” on socialized medicine! It’s not reality, apparently, as in the reality of a $32 trillion price tag and no plan to pay for it. Politico’s definition of “establishment” is rather broad, too, looping in corporate America with, um, Hillary Clinton and Barack Obama:
Deep-pocketed hospital, insurance and other lobbies are plotting to crush progressives’ hopes of expanding the government’s role in health care once they take control of the House. The private-sector interests, backed in some cases by key Obama administration and Hillary Clinton campaign alumni, are now focused on beating back another prospective health care overhaul, including plans that would allow people under 65 to buy into Medicare. …
“We know the insurance companies and the pharma companies are all putting tens of millions of dollars into trying to defeat us,” said Rep. Pramila Jayapal (D-Wash.), who co-chairs the Medicare for All Congressional Caucus. “Which I take as a badge of honor — that they’re so concerned about a good policy that they’re going to put so much money into trying to defeat it.”
You can practically hear the moustache-twisting in this news report from Politico’s Adam Cancryn. What exactly is a “deep-pocketed hospital lobby”? Many hospitals are non-profit or not-for-profit, and are most at risk if they’re stuck with nothing but Medicare reimbursements. The insurance companies certainly have deep-pockets and lobbyists, which explains why we got that other progressive priority from a decade ago, ObamaCare. The same is true for the pharmaceutical lobby and the AMA, which Politico somewhat disingenuously paints as opposed to government intervention in medicine. They were supportive of ObamaCare, which at the time was the biggest federal intervention in health care in history.
The problem with Medicare for All is the dirty little secret of Medicare — that insurers end up paying a lot of its cost. Providers lose money on Medicare patients and make it back up by charging everyone else more for their services. Cancryn gets around to mentioning this after demonizing the same industry players that helped drag ObamaCare across the finish line, albeit while somewhat twisting their response:
Medicare for All legislation would effectively eliminate private health coverage. And talk of greater government influence over health care has alarmed providers that contend Medicare and Medicaid currently pay only a fraction of what it costs to care for beneficiaries.
Actually, the problem of Medicare reimbursements is bad enough. It was bad enough from the beginning of Democratic interventions in health care, so much so that providers started an exodus out of the system after ObamaCare was adopted. Over time, that left Medicare recipients with fewer options and less access to care. Imposing Medicare on everyone means those providers won’t have any choice but to go out of business without the de facto subsidies that insurers were willing to pay when ObamaCare’s individual mandate was still in force. Without that subsidy, providers — hospitals, clinics, doctors — will go out of business or opt into concierge systems where only the wealthy can get care by demurring on Medicare coverage and paying cash instead. And that’s besides the fact that Medicare is generating enormous unfunded future liabilities with just the population it covers now.
All of that is what’s causing the political headache for Democrats. It’s not “establishment versus liberals,” it’s “fiscal reality versus progressives.” Democrats who won on the basis of Medicare for All will have to show how their ideas don’t make things worse. For the moment, they’re avoiding that issue by demonizing everyone else as “establishment” and “deep-pocketed lobbies.” That’s what you do when you can’t do math.