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National Health Program
A national health program, or “single payer” health care, is a system in which a single public or quasi-public agency organizes health financing, but delivery of care remains largely private. In other words, a public entity pays for medical costs delivered by private doctors and hospitals, like the current Medicare program.
Under a national health program, all Americans would be covered for all medically necessary services, including: doctor, hospital, long-term care, mental health, dental, vision, prescription drug, and medical supply costs. Patients would regain free choice of doctor and hospital, and doctors would regain autonomy over patient care. In the current system, those decisions are often restricted by private insurance companies who will only cover doctors in specified networks and only cover services they deem appropriate.
Physicians would be paid according to a negotiated fee for the services given (negotiated between the doctor and the financing agency), or they would receive a salary from their hospital or nonprofit HMO/group practice. Hospitals would receive an overall budget for operating expenses. Health facilities and expensive equipment purchases would be managed by regional health planning boards.
In 2004, RESULTS endorsed the National Academy of Sciences’ Institute of Medicine's (IOM) call for a system of universal health care by 2010 based on five guiding principles:
Using the framework of the IOM principles, our analysis of various health reform options found that the only policy option that meets these criteria is a comprehensive national health care program. It is our civic, social, and moral responsibility to guarantee quality affordable health care for everyone in America, and our government must play a central role in regulating, financing, and providing health coverage.
Under this system, patients are finally given autonomy over their health. Doctors and patients are able to make medical decisions without first getting approval from private insurance companies. Patients are no longer placed in specific “networks” that restrict their choice of doctor. Patient premiums, deductibles, co-pays, and other out-of-pocket expenses are eliminated. Doctors, patients, and hospitals no longer have to fight with insurance companies over reimbursements or maintain large, costly billing departments. Patients would also have the option of buying supplemental private health coverage for elective medical procedures like cosmetic surgery.
Furthermore, a national health program is good for the economy. The California Nurses Association released a report in January 2009 which shows that a national health program such as Medicare for All would be a major stimulus for the economy. Such a reform would create 2.6 million new jobs, and infuse $317 billion in new business and public revenues, adding $100 billion in wages to the U.S. economy. The Association notes that the number of jobs created by a single-payer system, expanding and upgrading Medicare to cover everyone, is almost exactly equal to the total job loss in 2008.
How Is a National Health Program Paid For?
The national health program system could be paid for through the savings generated by eliminating waste in the current system and by increasing public revenue. Despite spending more than twice as much as the rest of the industrialized world on health care ($7,129 per capita), the U.S. performs poorly in comparison on a number of major health indicators. The reason America spends more, but still falls short of other nations is our reliance on a patchwork system of for-profit payers. Private insurers necessarily waste health dollars on things that have nothing to do with care: overhead, underwriting, billing, sales, and marketing departments, as well as huge profits and exorbitant executive pay. Doctors and hospitals must maintain costly administrative staffs to deal with the bureaucracy. Combined, these needless administrative expenses consume one-third (31 percent) of Americans’ health dollars.
According to Physicians for a National Health Program (PNHP), the potential savings on paperwork and administrative costs alone amounts to more than $350 billion per year, more than enough to provide comprehensive coverage to everyone without spending any additional health care dollars. In addition, by having everyone in one network, the public financing entity would be able to negotiate with providers and drug companies for lower prices, thus reducing health care costs. For example, the Veterans Administration has been able to negotiate a 40 percent discount on prescription drugs. Modest tax increases would also be implemented to help cover costs for the system, replacing premiums and out-of-pocket payments currently paid by individuals and businesses. Costs would be controlled through negotiated fees, global budgeting, and bulk purchasing.
Physicians would be paid fee-for-service according to a negotiated formula, or they would receive a salary from their hospital or nonprofit HMO/group practice. Hospitals would receive a global budget for operating expenses. Health facilities and expensive equipment purchases would be managed by regional health planning boards.
Current National Health Program Legislation
The U.S. National Health Insurance Act (H.R.676) was re-introduced by Rep. Conyers (D-MI-13) in February 2015. This bill would create a publicly financed, privately delivered health care system, by building upon the existing Medicare program. The government will finance coverage, while private providers will deliver care. Such a program will maintain patients’ freedom to choose physicians and institutions. This bill requires training and job placement to those who lose jobs due to reduced administration and elimination of the private insurance sector. The system is paid for through savings generated, an increased payroll tax shared evenly with employers and employees, a stock transfer tax, and modest tax increases on the richest 5 percent of Americans.
Another national health plan bill is the American Health Security Act of 2009 (S.703/ H.R.1200), introduced by Senator Bernie Sanders (I-VT) and Rep. Jim McDermott (D-WA-7). While federally funded, this program would be administered by the states. In addition, the bill fully funds community health centers, improving access for 60 million Americans living in rural areas, and the National Health Service Corps is given resources to train 24,000 additional primary care physicians and dentists.
RESULTS remains committed to H.R.676 and S.703 as marker bills for the health system our country needs. Unfortunately, the major players drafting health reform legislation in the House and Senate did not use a single payer system as the model for health reform legislation this year. In the meantime, the health of millions of low- income Americans is at stake and so we simultaneously engaged in efforts to expand coverage and access for vulnerable populations. We supported policies that are building blocks to a national health program and will make a huge difference to people living in poverty in the short term. Specifically, our network pushed Congress to strengthen Medicaid to cover all lower-income Americans and expand access to quality care through Community Health Centers. For more on how health reform can further efforts for a National Health Program, see our 2010 International Conference Health Care Reform Workshop: What does it all mean? How can we build momentum for single payer plan? Power Point and Handout.