The tale of two Medicares: Canadian and American
Medicare for all — or the idea that every American should have some form of public health insurance — continues to forge its way into political debates. With such momentum, however, can come fear mongering and obstructionism. History and data may be of some help in disentangling any distortions.
By Andrew S. Boozary, STAT August 10, 2018
The United States and Canada launched their respective Medicare programs within a few years of each another: July 30, 1965 in the U.S. and July 1, 1968 in Canada. In the U.S., amid pushback from health care industry groups, American seniors were the only ones who received health insurance coverage, whereas all Canadians gained coverage regardless of their age or income.
This divergence was really a matter of politics — there is, after all, no constitutional right to health care in Canada. But it’s now hard to argue that there is a more unifying social program up north than Medicare.
Single-payer Medicare in Canada isn’t without shortcomings, to be sure, or free from attempts at dismantling it. One of the most consistent voices calling for the privatization of Canadian health care is the Fraser Institute, a Vancouver-based think tank that has been favored by the Koch brothers. One tactic used by Fraser’s advocates is to call public single-payer health care “unsustainable.” The institute’s 2017 report estimated that a typical family of four paid $12,057 for health care insurance.
After looking at that number, revered Princeton health economist Uwe Reinhardt pointed out that if Fraser economists made an honest comparison to the private health insurance markets in the U.S., Canadian Medicare could actually come off as quite the bargain. In fact, the 2017 Milliman Medical Index estimates $26,944 as the health insurance cost for a comparable American family of four covered by an average employer-sponsored preferred provider organization insurance plan. (The Canadian and U.S. estimates for 2018 are $12,935 and $28,166, respectively).
And just last week, the Mercatus Center in the United States — also listing the Koch brothers as donors — released a report targeting Sen. Bernie Sanders’ Medicare for All program, calculating that it would cost the federal government $32 trillion.
Charles Blahous, the author of the Mercatus report, made assumptions about the proposal’s total spending without underscoring the projected $2 trillion in savings. What he also failed to account for is how intensely premiums for private insurance are eating into the wages of American workers. By avoiding these facts, Blahous downgrades Medicare’s proven ability to rein in costs with the added prospect of universal coverage.
For international context, when researchers led by Dr. Ashish Jha at the Harvard T.H Chan School of Public Health earlier this year looked at how the U.S. health care system stacked up against other wealthy countries, they reached a clear conclusion about the diagnosis underlying America’s health care woes: prices. Contrary to popular opinion, it’s not that Americans get more tests or procedures, or even enjoy the ability to exercise more freedom of choice within the health care system. They are just paying staggeringly higher prices for the exact same things.
Facts matter, especially when it comes to health care. Yet Seema Verma, now serving as President Trump’s administrator of the Centers for Medicare and Medicaid Services, seems to repeat many of the Fraser Institute’s favorite myths about the Medicare program she is tasked with protecting.
For instance, Verma’s claim that Medicare constrains choice for both patients and providers flies in the face of almost every known poll and decades of scholarly research. And for all the fear mongering about “socialized medicine” and rationing under Medicare, the reality is that the current private health insurance system in the U.S. limits access to health care for millions through its astronomical prices.
Take, for example, Doreen Rudolph’s story. As a mother unable to purchase enough insulin for her young daughter, who has type 1 diabetes, Rudolph lamented that “if you pay for insulin, you can’t afford to buy food.”
I just bought 2 vials of insulin for my daughter cost me $524. With a discount card.All I could buy.I left the pharmacy and sat in My car and cried. I would never tell her this. I’ll tell her I was able to get from work because she knows i don’t have $.I have love and worry 24/7
— Doreen Jayne Rudolph (@DoreenRudolph3) July 21, 2018
The drug industry often defends the cost of treatment by arguing that innovation inherently comes with higher price tags — but that doesn’t hold here. Insulin as a treatment for diabetes was discovered in Canada nearly 100 years ago. The three discoverers patented their insulin extract and then assigned their patent rights to the Board of Governors of the University of Toronto for $1 each.
They had hoped their generosity would inoculate patients from industry’s control of insulin prices. It did not.
The general affordability of medicines is still an issue in both countries, however, as public drug coverage remains a gap in Canadian Medicare. But why a mother is now forced to go without an essential medication that her daughter depends on to survive in today’s most developed nation deserves an answer.
|Andrew S. Boozary MD is a Canadian primary care physician and visiting scientist at the Harvard T.H. Chan School of Public Health.|
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