APPLES AND ORANGES: How Obamacare, Medicare and ‘Medicare For All’ muddy the debate
By Shefali Luthra
The healthcare debate has Democrats on Capitol Hill and the presidential campaign trail facing renewed pressure to make clear where they stand: Are they for “Medicare for All”? Or will they take up the push to protect the Affordable Care Act?
Obamacare advocates have found a powerful ally in House Speaker Nancy Pelosi, who in a recent “60 Minutes” appearance said that concentrating on the health law is preferable to Medicare for All. She argued that since the ACA’s “benefits are better” than those of the existing Medicare program, implementing Medicare-for-All would mean changing major provisions of current Medicare, which covers people 65 and up as well as those with disabilities.
This talking point — one Pelosi has used before — seems tailor-made for the party’s establishment. It’s politically palatable among moderates who believe that defending the ACA’s popular provisions, such as protecting coverage for those with preexisting conditions, fueled the Democrats’ House takeover in 2018.
Progressive Democrats argue that the time has come to advance a far more disruptive policy, one that guarantees healthcare to all Americans. Those dynamics were on full display on Capitol Hill, as recently as an April 30 Medicare-for-All hearing.
But this binary view — Medicare (and, for argument’s sake, Medicare-for-All) versus Obamacare — oversimplifies the issues and distracts from the policy proposals.
“It’s sort of a silly argument,” said Robert Berenson, a health policy analyst at the Urban Institute, of Pelosi’s talking point. “She’s trying to argue the Affordable Care Act needs to be defended, and Medicare-for-All is a diversion.”
As the debate continues, one point should be clear: Medicare-for-All would not look like the ACA or like Medicare today. Instead, it — or any other single-payer system — would drastically change how Americans get health care.
Analyzing Medicare isn’t that helpful in understanding Medicare-for-All proposals.
Medicare for All is complicated, analysts noted, and the phrase is often deployed to mean different things, depending on who is speaking.
What’s clear is that the “Medicare” described in Sen. Bernie Sanders’ (I-Vt.) legislation — the flagship Medicare-for-All proposal — would create a health program far more generous than traditional Medicare’s current benefit, or even the vast majority of health plans made available through the ACA.
Sanders relied heavily on this concept during his 2016 Democratic presidential primary run and recently introduced an updated version in the Senate.
To be fair, though, Sanders also sometimes blurs the lines between the programs. In a May 5 appearance on ABC’s “This Week with George Stephanopoulos,” he used existing Medicare as part of his sales pitch: “Medicare right now is the most popular health insurance program in the country,” he said. “But it only applies to people 65 years of age or older. All that I want to do is expand Medicare over a four-year period to cover every man, woman and child in this country.”
As counterintuitive as it sounds, understanding Medicare as it works today isn’t helpful in envisioning a Medicare-for-All plan. Unlike with existing Medicare, the proposed health plan would cover things like nursing home care, vision care and dental services. It would get rid of cost sharing — meaning no premiums, deductibles or copays. (Sanders has acknowledged that financing the program would mean raising taxes.)
“It’s not Medicare. It’s something different,” said Ellen Meara, a health economist at the Dartmouth Institute for Health Policy and Clinical Practice.
But voters may not grasp the differences between the existing Medicare program for seniors and the hypothetical one being discussed. Pelosi’s comments may add to that confusion. Pelosi’s office did not respond to a request for comment.
Prioritizing efforts to bolster the ACA based on Medicare’s current benefit package “is convenient and not necessarily compelling,” Berenson said, adding: “No one is proposing the Medicare benefit package would be taken and applied nationally.”
That said, many of the presidential candidates have advanced far less sweeping healthcare options that would lower the Medicare age to 55 or allow people to buy in to the current Medicare program — an approach often referred to as a “public option.” Those would keep the program essentially structured as it is today.
The Democratic healthcare debate is more complicated than these familiar words suggest.
Every analyst interviewed for this story floated some kind of concern regarding a Medicare-for-All system. There’s the issue of how people would respond to losing the option of private insurance — a likely consequence of Sanders’ proposal — and the question of what level of tax hikes would be necessary to finance such a system, particularly if it covers a big-ticket item such as long-term care. There are also concerns about the financial impact for hospitals, often large employers in a community, or for the private insurance industry jobs that would likely disappear.
Focusing on current Medicare benefits misses the point, suggested Sherry Glied, a health economist and dean at New York University. When debating the merits of the ACA versus Medicare-for-All, Medicare’s current generosity is kind of a red herring, she said.
Plus, making Obamacare or Medicare-for-All an either-or debate ignores a sizable political bloc: Democrats who say they support the ACA and see single-payer as a next step. That tension is at play with presidential candidates like Kamala Harris, who frame Medicare-for-All as an ultimate goal, while also backing incremental reforms.
APPLES AND ORANGES
Comparing Medicare to Obamacare is difficult because each offers different benefits to different people.
The problem is that both Medicare and Obamacare are vast programs. Depending on your income, health needs and the version you sign up for, either one could prove the better choice.
“It’s impossible to say the ACA as a concept has more or less generous benefits,” Berenson said.
Broadly, the ACA has protections in place that traditional Medicare doesn’t. It caps how much patients pay out-of-pocket, and it has more generous coverage of mental health care and substance abuse treatment. But, in practice, those benefits have proved elusive for many because Medicare generally has a more robust network of participating physicians than many of the ACA’s cheaper plans, which restrict patients to a narrower coverage network.
Also, most beneficiaries don’t solely have traditional Medicare.
About a third use Medicare Advantage, in which private insurance companies construct Medicare plans with benefits and protections based on factors like company, tier and geography. They, too, are often restricted to narrower networks.
More than 1 in 5 traditional Medicare beneficiaries also receive Medicaid coverage, according to figures kept by the Kaiser Family Foundation, and about a third of them buy so-called Medigap plans, which are sold by private insurance and are meant to supplement gaps in coverage.
The ACA also encompasses an array of coverage options. Which plans are available in an area and whether earnings qualify a consumer for a government subsidy— a tax break meant to make an ACA plan more affordable — make a significant difference in evaluating whether Medicare or an ACA plan offers better benefits for a particular person or family.
Suggesting that one is clearly better than the other, Meara said, is a “gross oversimplification.”
But that kind of oversimplification may be hard to avoid, especially in a primary season where health care is a top issue.
“The Affordable Care Act is also not one thing, the way Medicare is not one thing,” said Katherine Baicker, dean of the Harris School of Public Policy at the University of Chicago. “So much of health care is more complicated than we can explain in a sound bite.” VTN
Shefali Luthra, a Kaiser Health News correspondent, covers consumer issues in healthcare. Previously, she was KHN’s Peggy Girshman Web Reporting Fellow. She graduated from Brown University with a bachelor’s degree in English literature.