Elias: Three letters explain the problems of single-payer insurance

It only takes three letters to explain why the idea of ​​single-payer health insurance continues to be quickly rejected by the California legislature: EDD.

No state, city, or local government program has proven less competent in recent years than the state Department of Employment Development’s unemployment insurance system, which lost $20 billion due to fraudulent claims in the first 18 months or so of the coronavirus pandemic.

Yes, the EDD has been inundated with complaints in this period of mass layoffs. But he was unfortunately unprepared for the many fraud schemes implemented against his funds during this most difficult time.

Yes, EDD has clawed back a few billion dollars from bogus claimants around the world.

But his demonstrable incompetence under three different department directors has millions of Californians wondering why anyone should entrust massive sums of money to the state to distribute to legitimate claimants.

And make no mistake about single-payer: that would involve far larger sums than the roughly $180 billion doled out by EDD in the first year and a half of the pandemic.

This year’s proposal, led by Democratic Congressman Ash Kalra of San Jose, would have resulted in an annual expenditure of nearly $400 billion, well above California’s overall budget.

Some of that money would come from redirected health insurance premiums, both for private insurance and for Medicare — if the federal Medicare system agreed to give up more than 10% of its cash flow. Some would come from money given to California by the federal Medicaid system, known here as Medi-Cal. But that would still have left many billions to raise, presumably thanks to the biggest tax increase in the state’s history.

How difficult this funding would have been to obtain was demonstrated when Kalra’s AB 1400 clarified what a single payer would do and what it would be – essentially Medicare for All, with no more involvement from the insurance company. and more distinction between Medi-Cal patients and everyone else. He did not specify where the money would come from.

Kalra’s bill has gone nowhere despite the fact that the extreme liberal Democratic politicians who now rule Sacramento, from Governor Gavin Newsom to Assembly Speaker Anthony Rendon and Senate Speaker Toni Atkins of San Diego, have all long supported the single-payer idea.

That was largely because many House Democrats didn’t want to be forced to officially declare for or against single-payer, especially in an election year when some will face new voters in June votes. and November.

Thus, Kalra’s bill died, at least for this year, without a vote taking place, and without many politicians being forced into positions for which they could be held accountable.

Nobody said it, but one of the main reasons was the ESD debacle. If the state couldn’t protect the unemployment insurance dollars paid out by several thousand employers, why would anyone think it would be able to handle much more money paid out by tens of millions of individuals?

The single-payer proposal has particularly offended current Medicare subscribers, who benefit from a system long opposed by Republicans — but embraced even by them in recent years because it works.

Typical is the coverage offered by Medicare for heart bypass surgery. First, it lowers the price charged for such procedures (and most others) by hospitals and doctors. Then he pays 80% of what he allows. Medicare subscribers (mostly people over 65, but also younger kidney dialysis patients and a few others) can get the remaining 20% ​​paid by widely offered supplemental insurance policies over enrollment periods of several months.

Surprisingly, there is relatively little fraud in health insurance claims.

Medicare paid out $718 billion in claims in 2018, the latest year for which totals are available. Known fraud against the system last year totaled just $1.4 billion, well under 1%, and action was taken against 142 people, including only 42 doctors and nurses.

No wonder so many people want Medicare for All. They sure don’t want EDD for all and until there’s definitely no single payer California that’s not gonna happen.

Email Thomas Elias at [email protected]

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