Single-Payer System: Why It Would Ruin US Healthcare

Leigh Page


September 29, 2015

In This Article

Scandal at the VA: the US Version of British Healthcare

The unhurried attitude of his British colleagues reminded Dr Geddes of the time he spent as a resident at two hospitals in the Veterans Health Administration, which is part of the Department of Veterans Affairs (VA). "The VA medical staff has some good doctors, especially in VAs affiliated with universities," he says. "But as a general rule, the staff has shorter work hours. They are just punching a clock."

The VA system is as close as US healthcare comes to the British system. It operates 150 hospitals and almost 1400 outpatient clinics and provides care to 8.3 million veterans a year. Like the NHS, it also has waiting lists, which involved a scandal that rocked the VA in the spring of 2014 and caused the departures of the VA secretary and the system's top health official.

For years, the VA has set limits on how long its waiting lists can be, but the number of patients has been growing well beyond the system's capacity to deal with them. It turned out that many VA staffers were fudging waiting-list numbers so that they wouldn't exceed the limit. Dr Geddes wasn't surprised. "This is a subpar healthcare system," he says. "If we introduced a single-payer system in the United States, pretty soon it would look like the VA."

"A single-payer system is about control," Dr Geddes says. "It isn't about improving healthcare. There are many ways of doing that without involving the government. It's about the need to exercise control."

Vermont Abandons Its Single-Payer Dream

In the past few years, Vermont had been the darling of single-payer advocates. The state had been planning a system called Green Mountain Care since 2011. But suddenly, in December 2014, Governor Peter Shumlin announced that the effort would be abandoned owing to the cost.

Before the governor's announcement, Green Mountain Care was expected to make money. A 2011 report by an outside consultant predicted $590 million in savings in the first year. But to get those savings, state government would have had to take over all the operations of commercial insurers, without having any experience.

In the end, Green Mountain Care was slated to cost the state $4.3 billion in 2017—almost doubling Vermont's total budget of $4.9 billion for fiscal year 2015. This would have required a payroll tax of 11.5% and a 9% tax on income.

Vermont has not entirely given up on its single-payer dream. The state is now reportedly[4] planning all-payer rate setting, in which it would set payments for Medicare, Medicaid, and private payers. This would be done through a unique federal waiver from the Centers for Medicare & Medicaid Services (CMS), but the state has not yet formally applied for it. If CMS granted the waiver, Vermont would be able to exercise the price-setting controls of a single-payer system without the costs of actually running the whole system.

But for now, the dream is over. A single-payer system was never a realistic goal, says David J. Weissgold, MD, a retinal surgeon in South Burlington, Vermont. "The plan was naive and foolhardy," he says. "It's the kind of sweeping change that plays well politically. It has inspired a lot of people, but it's a fantasy, a kind of a dream state. I never thought it would work."

The advocates of a single-payer system refused to face the grim reality of actually running such a system, even though it was there for all to see just across the border in Canada, says John McClaughry.

Faced with rationing in Canada, Vermont single-payer advocates said it was simply caused by "stingy taxpayers," he says. When a Vermont single-payer physician debated a Canadian physician who listed the system's failures, her reply was, "We're Vermonters; we can make it work," McClaughry recalls.

McClaughry, a former advisor to President Reagan and Vermont legislator, says that single-payer is a fundamentally flawed concept, focusing on the need for healthcare rather than on true demand. "Demand, initiated by patients who may not understand what they really need, will be replaced by government-controlled allocation of services on the basis of what patients are determined to reasonably need," he wrote in a policy brief.


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