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05/19/17

Check Please

We are in a series exploring the idea of a single payer healthcare system.  Click here to find the prior posts.

Now that we’ve looked at the polling data, for what that is worth, we need one more level before we start really contemplating a single payer system next week.

Am I stalling?  Maybe a little.

Let’s start with some questions. 

How much do you think we spend on education, both public and private, up through high school, in the United States?

Best I can gather, it is about $1.2 trillion.

And no, you can’t find workers who can compose a complete sentence on their cover letter.  I know, I know.

Next question.  Both healthcare and education are funded with a mix of public and private funds, but which has a greater portion of the total cost paid by taxpayers?

Most of us look around and from our sample size know that far more kids go to public schools than private, so we’d assume that public funds cover the vast majority of the total educational spend. 

But some of you are paranoid and are trying to guess which way I need this answer to break to support whatever point I eventually want to make about single payer healthcare, but now you’ve got yourself in a tizzy because you have no idea. 

So just answer the question.

It turns out that primary and secondary education funding is about a 50/50 split.  I’d have lost that bet.

How about healthcare?  What is the split between public and private funding?  Do taxpayers foot more or less than 50% of the total bill? 

In 2015, with total healthcare spending about $3.244 trillion, public funding sources covered 65% of the tab.  Just over $2.1 trillion. Blows away the education split, doesn’t it?

Wait, wait, you protest.  That can’t be right.  You have some vague idea of Medicare spending ($646 billion) and maybe a ballpark idea that Medicaid/CHP is close to that ($560 billion).  Those are the biggies and that gets us just over a trillion.  Where’s the other trillion? (Where else today can you read the sentence, ‘Where is the other trillion?’).

Other direct government payments for things like public health, the VA, and the National Institute of Health account for another $366 billion.  Still way short.

Now add the insurance premiums that all governments – federal, state and local – pay for their 22 million employees and you get another $211 billion.  You knew we were paying that bill, too, right?

Getting closer, but still short.

Half of us get our health insurance through our employer and you know that the portion of the cost paid by the employer is deductible for corporate tax purposes.  The estimated lost tax revenue from those deductions is about $326 billion.  Though not an actual check cut by the Treasury department, that is just as much a taxpayer cost as if it were.

Add them all up and you get to a tad over $2.1 trillion of ‘sources’ coming from taxpayers.  Click here if you don’t trust my math.

So, as we turn the corner and ponder the single payer policy option, we must modify our analogy.  We are not half-pregnant, but two-thirds so.

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ALN

Tim Coan, ALN’s CEO, writes an insightful and witty blog three times a week about a variety of topics relevant to independent physician practices.

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