The make-believe savings of single-payer

Adopting a single-payer system would cost so much, it would eliminate any administrative savings that advocates naively tout:

“Administrative” costs, generally speaking, are those not directly funding medical care but instead spent to deliver insurance benefits. Sure enough, on paper Medicare’s are about 3% of outlays, compared to 11% to 14% for the private system. But Mr. Zycher notes that a more accurate measure of Medicare’s administration would include other indirect federal services, such as tax collection, which round them up by about double. Fold in the incentives for the uninsured to consume more medical services under single-payer than they do now, and those “savings” are revealed as make-believe.

Mr. Zycher also points out that the adverse effects of the increased taxation required for “Medicare for all” more than outweigh the potential efficiencies. It costs the economy more than a dollar — the bottom-rung estimate is 20% — to send a dollar to Washington, so in the end Medicare clocks in substantially above private insurance.

Related posts:

1. Administrative costs and single-payer
2. The real Medicare myth
3. Single-payer supporters, be careful what you wish for
4. Single payer myths
5. Single-payer: "The flaws are unacceptable"
6. Single payer ills, part 2
7. Single-payer: Is the ivory tower this naive?

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Tagged as: Medicare