Ian's Insights: US healthcare system shake-up


Ian Higham is a consultant at Crimson Clarke and is currently pursuing a doctorate in political science at Stockholm University.  

America’s healthcare sector is on the verge of a major shake-up, and it could have wide-ranging ramifications for the global economy. Swedish readers might have missed it, but last week Senator Bernie Sanders published a widely-circulated op-ed[1] in the New York Times advocating “Medicare for All” – a single-payer healthcare system. Sanders made a moral case for providing Medicare – currently a government-run health insurance plan for Americans over age 65 who have previously worked – to the entire population. Sanders has now proposed legislation to make his idea a reality.

When I first came to Europe in 2009 to study in Copenhagen, the battle for the Affordable Care Act (ACA) – more commonly known as “Obamacare” – was raging back home in the United States. I remember how shocked Danes were to find out it was even a question. Then the debate seemed settled after Congress passed the ACA in March 2010. Yet the Republicans in the House of Representatives voted to repeal the ACA more than sixty times while Barack Obama was President, knowing that he would never sign a repeal bill.

Initiatives to repeal the ACA under Donald Trump, who does want to sign such legislation, began almost immediately after his victory last November.[2] There has since been significant disagreement within the Republican Party over just what type of policy would be better. This summer, repeal efforts reached a dramatic conclusion when Senator John McCain, a former Republican Presidential candidate who campaigned against Obama, returned to work after cancer treatment and teamed up with Republican Senators Susan Collins and Lisa Murkowski to vote down a repeal bill.[3]

The efforts to repeal and replace the ACA with a conservative plan continue, but as Sanders’s op-ed makes clear, the left wing of US politics also has a plan that effectively replaces the Obamacare model: single-payer healthcare. While it is unlikely that the US ever will see a completely public system like Britain’s National Health Service, or even a public-private hybrid system like we have in Sweden, there is a renewed push for some kind of universal coverage.

What is interesting here is not what Sanders specifically thinks: love him or hate him, he is the left-wing fringe of the Senate (albeit with a center that is decidedly to the right of Scandinavian politics) and a thorn in the side of a Democratic establishment that views him as a socialist renegade. Plus, given his age, he is unlikely to run for President again. Moreover, the Medicare for All bill, should it pass when Democrats regain control of Congress, is unlikely to get a signature from President Trump. But Sanders’s bill has attracted some very interesting supporters – and you should take note.

The first Senate Democrat to co-sponsor the “Medicare for All” bill was Kamala Harris, followed quickly by Elizabeth Warren, Kirsten Gillibrand, Cory Booker and Tammy Baldwin, among others.[4] Why are these names important? Because they are favorites to run for President in 2020. Kamala Harris in particular has been the subject of rumors about a Presidential run,[5] and her support for Sanders’s healthcare legislation is all the more remarkable with “Bernie bros” perceiving her, as well as Cory Booker, as a tool of Wall Street.[6] Indeed, some sources say she is already the preferred candidate of wealthy, more centrist donors. Tammy Baldwin, meanwhile, represents Wisconsin, a traditionally Democratic state that shockingly voted for Trump in 2016. Elizabeth Warren is a less surprising supporter, given her left-leaning and populist views, but she is also widely rumored to be considering a run for the presidency.

So what does all of this mean? Mostly that support for single-payer healthcare – at least in some form – is likely to be a litmus test for anyone serious about clinching the Democratic Party’s nomination for President in 2020. If Trump’s approval ratings stay as low as they’ve been lately, that could very well mean that the President in 2021 shifts the government markedly to the left in healthcare policy.

In the longer term, this could have major consequences for the American economy, US creditors, and companies operating in the healthcare space globally. Medicare for every American might make the population healthier, but it will also be extremely expensive for a country that already has $20 trillion of debt. Americans are still likely to need private insurance (or perhaps higher wages) to cover the costs Medicare does not cover – and it is far from certain what costs those will be: Medicare presently covers about half of a patient’s medical costs, and some individuals must pay a monthly premium. If single-payer healthcare is inevitable for the United States, you can be sure that there will be a lot of revision and amending of the existing legislative proposal, and no one can know whether costly prescription drugs, cancer treatments or mobility aids would be covered and, if so, by how much.

The effects of a potential shakeup in the American healthcare system reverberate far beyond US, and will even have an impact on the med-tech and life science community in the Nordics. Come talk with us at Crimson Clarke to find out more what these potential changes could mean for you and how you can better reach out to key stakeholders around this issue.

[1] https://www.nytimes.com/2017/09/13/opinion/bernie-sanders-medicare-single-payer.html?_r=1

[2] http://www.reuters.com/article/us-usa-obamacare/house-votes-to-begin-repealing-obamacare-idUSKBN14X1SK

[3] https://www.nytimes.com/2017/07/27/us/politics/senate-health-care-vote.html?mcubz=0

[4] https://www.vox.com/policy-and-politics/2017/9/12/16293016/sanders-single-payer-health-care

[5] http://www.newsweek.com/kamala-harris-2020-election-trump-663103

[6] https://mic.com/articles/183105/democratic-rising-star-kamala-harris-has-a-bernie-sanders-problem#.FFBxgDUKJ