On the Menu: Employer-Sponsored Coverage or Medicare for All Health Insurance  

 


 

Following last year’s failed efforts to repeal and replace the Affordable Care Act (ACA), supporters for “Medicare for all” or a government health care system are turning up the heat... and, it’s not because it’s HOT this summer in Washington, DC.  

There is growing support among Democrats and Independents that health care is a right, not a privilege and government should intervene. One-third of Democratic senators and about 60 percent of Democrats in the House have endorsed a “Medicare for all” bill. Six of the senators supportive of Medicare for all are up for re-election in this year’s mid-terms, and several are potential 2020 presidential candidates, signaling that this concept could intensify in the months to come and serve as a possible campaign platform for progressive candidates.

The outcome of the mid-terms and the next presidential campaign will no doubt impact future employer-sponsored health benefits offerings. Employer advocate groups including SHRM are gearing up for what is expected to be a steamy debate. As a health care lobbyist and consumer of employer-sponsored health insurance, I’m ready to defend the system!

Let’s review the key ingredients of employer-sponsored health insurance that has made the system successful in comparison to government programs. For starters, the employer-provided health care system has a solid base that has been in place for decades, providing quality, affordable health benefits to more than 178 million Americans. Employer health care plans dominate the health care market surpassing coverage offered through government programs like Medicare, Medicaid and the Exchanges of the ACA combined.

Adding to the recipe, employer-sponsored plans tend to be more generous and expansive. Employers have had measurable success controlling costs largely, because they implement consumerist and market-friendly approaches to health insurance. Government health programs, by contrast, have struggled to contain costs due to fraud or otherwise improper payments.

Sweetening the pot, employers have greater flexibility in designing their employer health benefit plans to meet the needs of their workforce. In addition, employers are implementing other health care design options, partnerships, and structures in an effort to continue to offer desirable compensation and benefits packages as a way to recruit and retain talent.  

On the other hand, the Medicare system has a lot of ordinary and some would say, generic ingredients which is not appetizing when there are many other options available. The Medicare population is typically older with more chronic conditions than the average population covered by employers. To add, based on current experience with government programs there is a lot of bureaucracy which could delay care and access to prescription drugs. This will inevitably lead to more (healthy) Americans dropping health insurance all together. With the risk pool consisting of the unhealthiest, it will result in higher costs for health insurance across the U.S.

So, what sounds more appealing to you? Employer-sponsored health insurance or Medicare for all?

 

 

 

The SHRM Blog does not accept solicitation for guest posts.
COMMENTS 2

Comments

I strongly disagree with SHRM's apparent opposition to a single-payer medical care system in the United States.
Beginning with my first work after college over 48 years ago I realized that burdening businesses with selecting health care for our nation's population was wrong-headed.
It is very difficult for me to understand why SHRM believes our businesses should divert significant financial and personnel resources to a focus on an issue that typically is neither a core function of their economic existence, nor within their knowledge.
SHRM---reconsider your stance.

I believe the whole premise of this article to be naive and must not have been written by someone who actually makes the financial decisions for small-medium size companies. I have never, in over 30 years, encountered a situation where the medical benefit package was selected with the EMPLOYEES' best interest as a primary factor. This statement, " Sweetening the pot, employers have greater flexibility in designing their employer health benefit plans to meet the needs of their workforce.", is just plain hogwash. Employers may be trying to offer the best plan possible that is AFFORDABLE for all parties, the employer and employees, but, odds are much more likely, that employers are driven by the factors of COST, COST, quality of plan, and COST when selecting a plan. Designing a plan to meet the needs of the workforce; well, I've yet to be in that meeting.

I'd also like to see the studies proving this statement, "Employers have had measurable success controlling costs largely, because they implement consumerist and market-friendly approaches to health insurance. Government health programs, by contrast, have struggled to contain costs due to fraud or otherwise improper payments."

If researched I believe that you will find that the actual amount of Medicare fraud/improper payments is trifling when compared to the overhead costs of insurance-based employer plans (usually 18-20%, or more) while Medicare has overhead costs under 5%.

Another misleading statement, "Employer health care plans dominate the health care market surpassing coverage offered through government programs like Medicare, Medicaid and the Exchanges of the ACA combined." 175 million to 125 million are the actual numbers--not sure that's domination, especially as the ACA was steadily growing before the current administration took over. And just because a program, like employer-sponsored health-care has been in place for decades does not mean that it is the best solution; it truly points more to the strength of the insurance lobby groups.

"To add, based on current experience with government programs there is a lot of bureaucracy which could delay care and access to prescription drugs." Again, where are the facts to back this up? I am an employer and participate in my company's plan through Florida Blue of Florida (the largest private insurer in the state). There are 3-4 week waits for treatment as they outsource treatment decisions to a third party for a determination on whether or not you may be covered---at their discretion, not the physician's. If this process isn't the epitome of bureaucracy I'm not sure how else to define it. These are the complaints we often here regarding "socialized" medical coverage in other countries. Guess what, it's here in the U.S. as well.

I don't pretend to have the perfect solution. But to narrow this decision down to a simple single-payer vs. employer-sponsored health care debate is to narrow the focus way too much. Our current systems (ACA, Medicare, and employer-sponsored) all have some pluses and each drags along its own set of issues. Unfortunately, the decision may come down to one or other. That is unfortunate because, if everything wasn't so politicized and partisan, we might actually be able to put some experts in a room and work out a plan or group of plans that are beneficial to all Americans. In this America though, that will never happen. They who control politically make the rules--neither side wants to negotiate anymore; the way to govern now is to dictate edicts and change the rules/laws to fit them. So, I'm afraid our health care services will remain very changeable from administration to administration for the foreseeable future. Whether or not that is good for the consumer, be they employer or employee, remains to be seen.

Add new comment

Please enter the text you see in the image below:
Image CAPTCHA