Policy

Large employers question ‘Medicare for All’ plans, survey shows

Business group poll shows concerns about costs, taxes still loom large

National Nurses United union members wave “Medicare for All” signs during a rally in Washington on April 29. (Bill Clark/CQ Roll Call file photo)

Most large employers say a “Medicare for All” system would lower the number of uninsured people in the United States, but they are concerned it could increase health care costs and taxes while stifling innovation and quality, a new survey shows.

The concerns come as health industry groups seek to block momentum for plans from Democratic presidential candidates and lawmakers to expand Medicare through a single-payer program or to allow people under age 65 to enroll in the program.

[‘Medicare for All’ doesn’t just rival Canada’s system. It goes further]

A range of proposals face fierce opposition from most of the health care industry, but the survey shows other industries are similarly hesitant and suggests they may also lobby against similar proposals.

The survey, conducted in May and June by the National Business Group on Health, incorporates answers from 147 large employers, including in health care fields like insurance, pharmaceutical and medical products and health care providers, as well as banking and finance, technology, telecommunications and manufacturing. Forty-nine percent of its members responded.

Nearly three-quarters, or 72 percent, of respondents said they expect a Medicare for All plan would decrease the number of uninsured, but 81 percent said it would increase tax rates.

[How ‘Medicare for All’ went from pipe dream to mainstream]

Employers also reported concerns that a Medicare for All plan would decrease delivery innovation, which 69 percent of respondents said they expected, while 56 percent said such a plan would decrease health care quality.

“There’s just quite a lot of concern about employers and the devil in the details about whether these proposals would actually lead to improving cost and quality outcomes for covered family members,” Ellen Kelsay, chief strategy officer at the National Business Group on Health, said Tuesday at a press briefing outlining the report.

Large employers also say they expect health care costs for the U.S. and individual employees will go up, in part contradicting a key argument for establishing a single-payer system — lowering costs by eliminating insurance premiums and out-of-pocket expenses.

Only 16 percent of survey respondents said they thought health care costs for their employees would fall under a Medicare for All system, while 47 percent said costs for their employees would increase. Separately, 57 percent said health care costs would rise for the United States.

Many of the current proposals don’t fully explain how the system would control costs, making it hard for employers to believe costs would actually decrease for individuals, said Brian Marcotte, the group’s president.

“The concern is if you’re going to cover everything, your costs will go up, and without any indication of how you’re going to manage the care or ensure that if you’re covering more it’s for evidence-based or value-based care, not just covering everything,” he said. “Employers are concerned about how you actually manage the costs under a Medicare for All scenario.”

A House bill that would set up a single-payer system seeks to control health care costs by implementing a global budgeting system, which would regularly provide a lump sum to hospitals to cover services, while individual doctors would be paid under Medicare’s traditional fee-for-service system.

Advocates for a Medicare for All system say it would lower health care costs for individuals because they wouldn’t have to pay premiums or most out-of-pocket costs.

Employers are largely torn over whether a Medicare for All plan would increase or decrease access to care, with 40 percent reporting they thought it would decrease access and 38 percent saying it would increase it.

They’re also torn over whether to expand Medicare eligibility by lowering the age at which people can enroll in the program. Forty-five percent of respondents said the threshold for Medicare eligibility should remain at 65, while the other 55 percent said the age threshold should be lowered, but were split on when adults should become eligible for the program.

Some employers may be nervous that offering a Medicare plan to some employees could lead to adverse selection that would raise prices for their employees’ health plans, Marcotte said.

“Typically the people who move out of a health plan first are those that are healthier as opposed to those who are sicker, so … if you’re losing healthy people from your population, then your health care costs are going to go up for everybody else,” he said.

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