Don’t Assume Private Insurance Is Better Than Medicaid
Aaron Carroll, a professor of pediatrics at the Indiana University School of Medicine, and Austin Frakt, a health economist with several governmental and academic affiliations, lay out the case in the New York Times Upshot feature.
Why Single-Payer Health Care Saves Money
The total cost of providing health coverage under the single-payer approach is actually substantially lower than under the current system in the United States, Robert H. Frank writes in The New York Times.
Total costs are lower under single-payer systems for several reasons. One is that administrative costs average only about 2 percent of total expenses under a single-payer program like Medicare, less than one-sixth the corresponding percentage for many private insurers. Single-payer systems also spend virtually nothing on competitive advertising, which can account for more than 15 percent of total expenses for private insurers.
The most important source of cost savings under single-payer is that large government entities are able to negotiate much more favorable terms with service providers. In 2012, for example, the average cost of coronary bypass surgery was more than $73,000 in the United States but less than $23,000 in France.