Medicare For All

Why do Americans often say we have the best medicine in the world, yet many cannot access and pay for the health care when needed?

We have many effective tools to prevent diseases (e.g., vaccines) and to mitigate complications of many illnesses (e.g., statins for cardiovascular disease, Paxlovid for COVID-19) – medical interventions that should decrease health care costs -- yet these costs are increasing every year.

There are no simple answers to complicated issues, yet some are rather obvious but ignored or hushed. The bottom line is that the medical industrial complex, made of pharmaceutical and insurance companies, hospitals and private medical providers, will charge us “what the market is willing to pay.”

The Moderna and Pfizer COVID vaccines offer an example. The U.S. government provided $337 million in long-term capital to research the mRNA technology, then invested nearly $32 billion to help develop, produce and purchase COVID vaccines through March 2022, while these two companies made more than $100 billion in global revenues from sales in 2020-21 alone.

Yet for a vaccine that eventually costs only $1 to $3 per dose to manufacture, these companies have announced plans to charge $130 a dose in the U.S. when our government stops its vaccination program subsidies. They justified the new price as “consistent with the value” of the vaccine.

So how is the market value of a medical product determined? Basically, the marketer would use the estimated financial burden a particular disease causes to society, then aim the pricing around that target, to make the use of its product “cost-effective” enough to be recommended by official agencies and medical providers.

What the market is willing to pay is the price-fixing power of the companies, accounting for the cost of production, distribution, promotion and substantial payouts to corporate shareholders, the amount of these rewards being two or three times more than what they spent on research and development. Lucrative patents would keep competitors away and allow companies to control the market, while government regulations are minimized through lobbying.

In the end, medical advances seldom decrease care costs, since potential cost savings from appropriate medical interventions are scooped up as corporate profits. It is no surprise that our health care is the most expensive system in the industrialized world, accounting for 18.3% of our gross domestic product, while for Europeans it is around 11%, and with better outcomes in most health measures.

What can we do about this? While it is impossible to outline detailed solutions in a short essay, let’s start with two fundamental changes.

First, we have to stop believing in myths: (1) that our current system offers choices -- it does not: Providers and patients are boxed into medical and financial options set by insurance companies;

And (2), that everything run by the government is bad -- The U.S. Department of Veterans Affairs, Medicare and Medicaid services provide good essential services at lower administrative costs than private companies (3% vs. 18%, respectively); private Medicare Advantage Plans have not been proven to deliver better clinical outcomes than traditional Medicare, but eventually cost more to taxpayers.

Second, health care should not be treated as a market commodity, commercialized and manipulated by financial investors. While some investment profits are necessary to support medical progress, health care should be a shared social responsibility driven by scientific evidence and operating under public governance.

In the end, we all pay for each other’s illnesses. A healthy population is fundamental to societal safety and productivity. We can’t let private for-profit corporations decide who can afford health care. Medicare for All is the only reasonable solution.

(Published in the “As I See It” opinion column of the Gazette Times, Corvallis and Herald Democrat, Albany, April 13, 2023)