Study Shows Single Payer Would Save the Country Greatly

Study Shows Single Payer Would Save the Country Greatly January 20, 2020

A new study, actually a comprehensive review of 22 other studies, finds that a single payer health care system would reduce spending even while providing universal coverage. The interesting thing is that every single one of the studies found overall savings regardless of the exact plans being considered and regardless of the political perspective of the study’s authors. Here’s the abstract:

We conducted our literature search between June 1 and December 31, 2018, without start date restriction for included studies. We surveyed an expert panel and searched PubMed, Google, Google Scholar, and preexisting lists for formal economic studies of the projected costs of single-payer plans for the US or for individual states. Reviewer pairs extracted data on methods and findings using a template. We quantified changes in total costs standardized to percentage of contemporaneous healthcare spending. Additionally, we quantified cost changes by subtype, such as costs due to increased healthcare utilization and savings due to simplified payment administration, lower drug costs, and other factors. We further examined how modeling assumptions affected results. Our search yielded economic analyses of the cost of 22 single-payer plans over the past 30 years. Exclusions were due to inadequate technical data or assuming a substantial ongoing role for private insurers. We found that 19 (86%) of the analyses predicted net savings (median net result was a savings of 3.46% of total costs) in the first year of program operation and 20 (91%) predicted savings over several years; anticipated growth rates would result in long-term net savings for all plans. The largest source of savings was simplified payment administration (median 8.8%), and the best predictors of net savings were the magnitude of utilization increase, and savings on administration and drug costs (R2 of 0.035, 0.43, and 0.62, respectively). Only drug cost savings remained significant in multivariate analysis. Included studies were heterogeneous in methods, which precluded us from conducting a formal meta-analysis.

Conclusions

In this systematic review, we found a high degree of analytic consensus for the fiscal feasibility of a single-payer approach in the US. Actual costs will depend on plan features and implementation. Future research should refine estimates of the effects of coverage expansion on utilization, evaluate provider administrative costs in varied existing single-payer systems, analyze implementation options, and evaluate US-based single-payer programs, as available.

That part that I put in bold is the really important part. The review included studies done by groups that oppose single payer systems and found that even those studies conclude that there would be significant cost savings after the first few years.

We also searched the websites of leading advocacy and industry-sponsored groups in favor of single-payer reform (Physicians for a National Health Plan and Healthcare-NOW) and in opposition to single-payer reform (Partnership for America’s Health Care Future).

For example, they included studies from the Mercatus Center, a libertarian think tank at George Mason University, and the Lewin Group, which is owned by health insurance giant United Health Care. And even those studies from conservative and libertarian groups that say costs will initially increase find net savings by the 10th year. The shift toward net savings averaged 1.4% per year, added cumulatively each year. I’d say this is a very important study review that needs to inform our debates over the future of our broken health care system.


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