The underlying dilemma of reforming U.S. health care is that most Americans like their insurance plans. About half the population is covered through group insurance offered by employers, and most are reluctant to overhaul a system that works for them.
Because of that, progressive purists seeking the Democratic presidential nomination should keep an eye on Washington’s budding Cascade Care plan. Our state has become the first to adopt a public option with the goal of increasing the number of citizens who have adequate insurance, the kind that provides preventive care that saves costs in the long run, leads to less self-rationing of doctors’ visits and prescription drugs, and provides an insurance option even in the event of personal financial struggles.
Cascade Care, passed by the Legislature this year and signed by Gov. Jay Inslee, will take effect in 2021 following an enrollment period beginning a year from now. “Washington state is leading the nation in a brighter way to provide for the health and security of our families,” Inslee said at a bill-signing ceremony in May.
Under Cascade Care, the state will offer insurance plans on the Health Benefit Exchange but contract with private insurers to administer those plans. It is a quasi-public metric that critics decry as government intervention in the private market. There are good reasons for caution; on the other hand, the U.S. health care system typically ranks outside the top 20 in the world, indicating the need for improvement. According to the World Health Organization, the United States has by far the most per-capita spending on health care, but we do not have the best health outcomes.
The question of how to foster improvement is at the crux of the discussions. Presidential aspirants Elizabeth Warren and Bernie Sanders, among the leading Democratic candidates, favor a “Medicare for All” system that would provide care for all Americans but would scuttle the private insurance market.
A study last month from the Urban Institute and the Commonwealth Fund estimates that such a plan would cost the government $32 trillion over 10 years; the entire federal budget for fiscal year 2019 was about $4.4 trillion. While the price tag is eye-opening, it should be noted that previous studies have estimated that Americans will spend about $34 trillion on health care over the next decade under the current system.
The cost of Medicare for All and Americans’ affinity for private insurance likely will render a government takeover of the system as a non-starter in Congress and in the court of public opinion. Because of that, candidates should take a more measured approach similar to Cascade Care.
Under that legislation, provider reimbursements will be capped at 160 percent of Medicare payments. That will reduce payments for many providers, leading to concern that some will close their doors to public-option patients. With many rural areas already experiencing a shortage of providers, it will be essential to manage the market to deliver care where it is most needed.
Under the Affordable Care Act and the Medicaid expansion that accompanied it, Washington has done a good job of insuring citizens and controlling costs. But the market is fluid and complex and changes from year to year.
Washington’s establishment of a public option is a bold experiment in health care that will be imperfect yet could be a step toward increasing the number of residents who have access to care. If it effectively combines the best aspects of public care and private insurance, Cascade Care could serve as a model for the rest of the nation.