Medicare for All Means Innovation for None
Leading Democratic presidential primary contenders have now almost unanimously endorsed some sort of Medicare for All proposal. Public support to expand the universal health services currently granted to older Americans via Medicare to the entire country is now in the majority, and the move would replicate publicly-funded universal healthcare in other developed nations.
Many progressive and moderate Democrats alike have supported Medicare for All, touting superior access and lower healthcare costs of single-payer, socialized systems. But healthcare coverage alone does not mean better health outcomes, and a brief review of Medicare’s real-world results reveals a chief problem of socialized healthcare — its destruction of innovation.
When President Lyndon B. Johnson first introduced Medicare and Medicaid in 1965, health coverage was much less common. Fifty percent of American seniors did not have health insurance, and those who did faced rates three times those of younger people. Johnson’s Medicare initiative sought to end this inequality, giving all American seniors the coverage reflective of a “Great Society.” And consequently, nothing in American senior care resembles what existed before Johnson’s initiative.
Nothing except life expectancy.
In 1965, American life expectancy was 70 years — it is now just 78 years, a modest improvement at best. The fact that the last 54 years of unprecedented American innovation has been accompanied by only eight years of increased life expectancy is quite concerning. During that period, rotary phones transformed into pocket-sized supercomputers, but most Americans still live fewer years than many of the Founding Fathers. Public health enthusiasts often challenge this correlation, noting that medical care has also greatly improved. They are partially correct.
This innovation has been unequally distributed. Ailments mostly reserved to the elderly in many cases persist, even as those that plague the young are cured en masse. Diseases like Alzheimer’s, Parkinson’s, and dementia are all just as prevalent among seniors and untreatable today as they were in 1965. The lack of innovation is staggering, but is enabled by an equal lack of competition among healthcare providers for seniors, most of whom are on Medicare rather than private plans.
Payroll taxes allow Medicare to survive regardless of outcomes and make superior alternatives unaffordable for seniors. Heart disease and cancer treatment have seen improvements, but that progress was mostly targeted at other age groups that largely participate in market-based private health insurance.
Of the 10 types of cancer most common among young adults, almost all now have survival rates near or better than 90 percent. Leukemia is an outlier in this group, as it has a survival rate of only 60 percent. But about 85 percent of young children diagnosed with the most common form of leukemia will survive — it’s the elderly that keep the survival rate low.
A National Institutes of Health study published in 1993 concluded that “The lack of significant improvement in median survival in the last 40 years for those older than 60 years of age stands in stark contrast to the remarkable improvement for younger patients. Acute leukemia in older patients demands new and probably different therapeutic strategies.” Medicare has yet to address this disparity, which is typical for conditions that affect older people.
In contrast, outcomes related to treatments for seniors that overlap age groups have seen major improvements. For example, breast cancer survival increased from 64.9 percent in 1975 to 82.8 percent by 2002, but half of women who are diagnosed are under the age of 62, when most patients still privately fund their health and incentivize innovation. Testicular cancer also saw a 95 percent death rate in 1975 become a 95 percent cure rate by 2010, but testicular cancer is also the most common cancer for males between the ages of 15 and 35.
Public healthcare has little incentive to introduce new technologies and prolong life. Rich countries like the United Kingdom and Canada provide universal healthcare, but have lower cancer survival rates than America. That’s why many more American seniors today have health insurance than in 1965, yet their health outcomes are still often terrible. And more funding isn’t enough — Medicare already indiscriminately funds treatments, but lacks the mechanisms and competition to decide which are effective. This might be why up to 20 percent of Medicare claims are fraud and waste.
If socialist healthcare is as great as Democrats claim, why do Saudi Kings and half a million other medical tourists fly far away from their socialized systems to America to receive adequate treatment?
Even the few socialized healthcare systems with higher life expectancy, due primarily to healthier lifestyles, count on American innovation to improve their health systems. But American socialists emboldened by good intentions seek to sabotage the vestiges of our free market system. America should resist the regressive movement to end inequality by giving everyone equally terrible healthcare.
J.J. Rich is a policy analyst at Reason Foundation and a Young Voices contributor. He can be reached on Twitter @jacobjamesrich.