History of Dead Ends

The history of efforts to reform American healthcare on a grand scale is littered with instances of failed initiatives, the exceptions being the establishment in 1965 of the public programs Medicare (for the elderly and certain disabled groups) and Medicaid (for low-resourced individuals and families) and the ACA (expansion of coverage to persons without traditional sources of insurance) in 2010. This raises the question whether something like Medicare by Choice would be feasible. Or would the same fate await it that doomed so many other large-scale plans?

In the 1930s, President Roosevelt proposed a comprehensive system of nationalized healthcare along the lines of a single-payer model in the Social Security Act. it got nowhere.

Thirty years later, President Johnson proposed that the two public programs he helped establish, Medicare and Medicaid, cover everyone. But he had to scale back his proposal due to political opposition.

Though President Nixon didn’t favor a single payer system, he floated the idea of mandates that would require all employers to provide health insurance for their employees. This notion was abandoned but revived 20 years later when it became part of President Clinton’s plan that would apply to all businesses with more than 5,000 full-time employees. The Clinton administration’s healthcare initiative put forward in 1993, colloquially referred to as Hillarycare, was closely associated with the chair of the task force, first lady Hillary Clinton. The plan included guaranteed issue of insurance coverage to all who signed up, regardless of health status. And the proposal extended the coverage obligation to all Americans and permanent resident aliens by requiring them to be enrolled in a “qualified health plan” that had to meet minimum benefit standards. Healthcare reform didn’t get far. By the middle of 1994 it was moribund.

Since passage of the ACA, the progressive wing of the Democratic Party has introduced legislation called Medicare for All that would essentially eliminate private insurance and usher in a single payer system in which healthcare is provided for all and financed by the government through tax payments. Medicare for All is sometimes talked about as if it’s the only way forward.

The U.S. healthcare system is tremendously complex and heavily influenced by stakeholders with vested interests in maintaining the status quo and the power to thwart efforts to reform in one fell swoop. Throughout history, comprehensive reform efforts have often been opposed on ideological grounds, for example, by libertarians and others in America who don’t like the idea of government intervention or takeovers of any business sector, including healthcare. Attempts at reform have also been stymied by groups as varied as the physician group, the American Medical Association, and the health insurer trade organization, the American Health Insurance Plans. Attempts at creating a single payer system, such as Medicare for All, have been especially prone to strong opposition from key stakeholders.

But Medicare by Choice is designed as an alternative to Medicare for All, as it builds on the existing Medicare framework. Thus far this century a number of fundamental changes in healthcare have succeeded in getting passed in congress, perhaps owing in part to their working more or less within the confines of an extant system. For example, the Medicare Modernization Act in 2003, the 2010 Affordable Care Act and 2022 Inflation Reduction Act expanded or strengthened coverage. Medicare by Choice goes further than all three laws mentioned. Yet it doesn’t tear down what already exists, which possibly gives it a leg up on legislation that would introduce drastic changes.

Medicare by Choice is similar in spirit to a bill introduced last year called the Choose Medicare Act. According to this piece of legislation, plans would be offered on all state and federal exchanges, giving people the ability to use existing ACA subsidies to help cover their premiums. At the time the bill was introduced, the enhanced subsidies hadn’t yet expired. Now that they have, it stands to reason that House Democrats, following the Democratic Senators’ memorandum, would pursue re-installment of enhanced subsidies.

The proposed Choose Medicare Act aims to be “self-sustaining” and "fully paid for by premiums" so as to avoid dipping into the Medicare trust. New enrollees would pay premiums calculated to ensure a new segment dubbed Medicare “Part E" remains “financially solvent.” But just how high the premiums would need to be is unclear.

While thought-provoking, the Medicare by Choice discussion is still somewhat disconnected from today’s political reality, as it would have little chance of passage in the current congress and even less of a chance of getting President Trump’s signature. But maybe with a new congress (and eventually a new president) a more modest approach such as Medicare by Choice is possible. Time will tell.