The Difference Between a ‘Public Option’ and ‘Medicare for All’? Let’s Define Our Terms

Various proposals are floating around, each of which would change the health care system in distinct ways. Some, like one from Senator Bernie Sanders, would do away with all private health insurance. Some would make small expansions in existing public programs. Some would try to cover all Americans through a mix of different insurance types.

It can be mystifying when people call all of these ideas “Medicare for all,” as some in the debate have been doing.

.. Private plans handle Medicare drug coverage, and you can choose among options. You pay premiums each year, and you pay deductibles and co-payments when you use medical services.

Because the program’s out-of-pocket spending has no limits, most Medicare beneficiaries also buy private supplemental insurance to limit those costs. That insurance doesn’t cover medical services outside the Medicare system, but it helps pay the patient’s share of the bill when a person goes to the doctor or hospital.

.. Mr. Sanders, who prominently featured such a plan in his 2016 presidential platform and just announced he has joined the 2020 race, uses this term a lot. His plan would both expand traditional Medicare to cover all Americans, and change the structure of the program, to cover more services and eliminate most deductibles and co-payments. So the Medicare everyone would be getting would differ in crucial ways from the Medicare older people get now.

There would effectively be no private health insurance, because the new system would cover everyone and everything; duplicative coverage would be banned. That’s why Senator Kamala Harris of California, a co-sponsor of the Sanders bill and a presidential candidate, told CNN recently that she would endorse abolishing all private insurance — doing so is a key feature of the plan.

But there are many other possible flavors of Medicare for all. Though no prominent politicians are currently proposing it, an expansion of the current Medicare benefits, with its current co-payments, deductibles and premiums, could also be thought of as “Medicare for all.”

The idea of Medicare for all is suggestive of the health care system in Canada. There, doctors and hospitals remain private, but everyone gets insurance from the government. No one there is asked to pay any money when seeing a doctor. The Canadian health care system is even called Medicare.

What is socialized medicine?

Critics of single-payer are particularly fond of this term, which describes a system in which the government runs not just the financing of health care — by running an insurance company like Medicare — but also manages hospitals and employs medical providers directly. Britain’s National Health Service is an example of a socialized system. Doctors there work for the government.

The United States has its own socialized system, for military veterans. Veterans get their insurance through the Department of Veterans Affairs, which owns hospitals; employs doctors, nurses and other medical professionals; and negotiates directly with pharmaceutical companies for drugs. In general a veteran couldn’t get coverage for routine care from a doctor who didn’t work directly for the V.A., but recent policy changes have started to privatize more health care for veterans.

.. When lawmakers were writing the Affordable Care Act, there was an extensive debate about whether it should include a public option. The idea didn’t prevail in the end, but many Democrats now want to bring it back.
You can think of a public option as something of a compromise between a single-payer system and our current system, in which only certain Americans now qualify for government-run programs. More people — maybe many more — could get government insurance. But only if they wanted it.

Public-option plans would allow middle-income, working-age adults to choose a public insurance plan — like Medicare or Medicaid — instead of a private insurance plan. There are various ways this could work. Some proposals would allow individuals to pay a premium to buy a Medicare or Medicaid plan that would be the same as the insurance now available to older people, the disabled or the poor. Others would set up a new public plan, run by the government, that Americans could buy. Under most proposals, people who get federal help buying Obamacare coverage could use their government subsidies to help them buy either a private or public option.

Most of the current proposals would limit access to the public option to certain groups of Americans. A bill from Senator Debbie Stabenow of Michigan and colleagues would allow only those older than 50 to buy a Medicare plan, for example. Some plans would allow only people who buy their own health insurance to choose Medicare or Medicaid as an option alongside those offered in the Obamacare exchanges.

Others would also let employers choose Medicare, instead of a private health insurance company, when offering benefits to their workers. A plan from a liberal think tank, the Center for American Progress, would make the public Medicare option available to anyone who wanted to sign up.

Others would also let employers choose Medicare, instead of a private health insurance company, when offering benefits to their workers. A plan from a liberal think tank, the Center for American Progress, would make the public Medicare option available to anyone who wanted to sign up.

.. Most other developed countries embrace this idea, that health care should not be only for those who can afford it. But those countries have not all embraced single-payer approaches.

There are ways to achieve universal coverage that don’t look like a single-payer system at all. Most European countries, for example, have systems with competing private health insurance plans, along with tight regulation and government subsidies that make the premiums affordable for everyone. This article from my Upshot colleagues Aaron Carroll and Austin Frakt, in which experts voted on the world’s best health system, does a nice job of showing the different ways that countries have achieved universal coverage. This sort of European-style coverage is not prominent in our current policy debate.