So I came across The New Republic article (opinion piece?) that was less than charitable about Pete Buttigieg’s health plan: “It is deeply stupid” “It is a faux technocratic fantasia” “It is an insult”. At first I was angry that anybody was writing in such a way about a plan thought out carefully and with what I believe to be the best intentions by Pete and his team. But then I did a little deep dive into the other articles that she wrote, and realised that she does care deeply about the healthcare issue and is projecting some very understandable anger at Pete, a candidate she sees as “leaving the status quo unruffled”. And to be honest I can see why that’s what the plan kind of looks like unless you have been listening to Pete carefully. Admittedly he has been emphasizing the “choice” aspect of his philosophy more than the “glidepath to medicare for all” recently in his rhetoric, but I do not believe Pete would design the system this way if he was starting from scratch. The reality is all of the candidates do have to transition toward a more fair and just and efficient system when the current one has failed so deeply in so many measures.

The author makes some bad faith attacks about how Pete leaves out details about how “automatic enrollment” would work. But there is literally a footnote that she didn’t bother to read that does exactly that. It’s a little strange that this is the detail she fixates her strongest indignation on, almost proving at least the theoretical soundness of the rest of his details while disagreeing with them all the same.

She makes a decent point about why having a backstop fund to retroactively enroll the uninsured who need care wouldn’t encourage everyone to chance it and do without buying insurance. I had the same question and did end up finding the answer in the same piece that explained automatic enrollment, but to be fair that point did need at least a footnote or another sentence or two of its own. She also brings up reimbursement rates for providers and whether they would match medicare rates, dramatically reducing income for providers. This is actually one of the big unanswered questions in the Warren/Sanders plan as well, so I’m not sure demanding details that are not explained in a full senate bill is entirely fair.

Another point also doesn’t land: a pretty misleading comparison of the cost burden of the plans. She compares the direct premiums for Pete’s plan for a single person making 50,000 to Bernie’s household premiums for a family of four earning 50,000, ignoring that those objectively are two very different things. Also, Economics 101 teaches that Bernie’s other proposed payroll taxes also are borne by the worker whether they are paid by their employer or not. But more on that later.

Where she really nails her point convincingly though, is that the profit motive and market based system has created some really grotesque outcomes ranging from pharmaceutical industry greed, to denying care, to opaque prices patients have no choice but to pay, to doctors that are both heroes and also scrooge mcducks, to allowing people to die for want of money. (I’m paraphrasing but sympathising)

So does her theory hold up that Pete is just a Harvard man with a naive plan? I figured in order to really investigate I had to at least actually read the document from the competition — The 100 page senate bill with Sanders/Warren’s name on it. The author clearly reveals her preference for Sanders when she criticizes Warren for not having revealed the details of her health plan in spite of the fact that neither of them has a detailed plan beyond the bill. (I guess to be fair there are a few nods on their respective websites to specialty health issues and a couple plans I saw by Warren — one about the government manufacturing generics, the other about changing the incentive structure to save black maternal lives, but that’s about it). The bill makes a poor campaign document, as few will read it, but that may also be to both of their advantage as one can naively assume it contains a lot more substance than it does. Anyway I dove in. It’s a slog, so I’ll summarize: Essentially you can go to Bernie’s website, read the 4 paragraphs and 4 bullet points, and that’s what’s in the bill. Not that that’s nothing, it’s in fact a very big thing, but it isn’t a particularly complicated thing:

1.healthcare is a right

2. single-payer funded comprehensively through the tax system is a better and more moral system for delivering that right

3. pharmaceutical companies are despicable and need to be actively and concretely reined in (it doesn’t use those words but you get me)

The rest is mostly details of: what is covered in comprehensive (almost everything! interestingly there is allowance for a $200 yearly pharmaceutical deduction, which seems almost quaint when contemplating having 0 out of pocket cost for all other health related transactions); implementation schedule (4 year process); quality standards; equity standards; provider criteria. There’s a lot of things that approximate “policies will be made regarding appropriate prices” — details to be worked out later by experts or review boards. He does put aside a 1% fund to help people whose jobs are displaced by the bill, which is nice.

One thing that did stick out — and someone needs to fact check me on this because I read it 3 times and didn’t quite believe I was reading it right — is that while private insurance that duplicates the coverage of Medicare for All will be outlawed, providers in the new system get a whole section describing being allowed to provide service via “private contract”. If I’m reading this right even Bernie doesn’t think he’s going to be able to outlaw free market healthcare between willing cash payers and providers. This would definitely set up a system that is 2 tier, allowing different care standards for those who have to rely on the public system and those who can pay providers directly in cash. So while Berniecare is to the left of Canada in its comprehensiveness, it is to the right when it comes to allowing the free market into the provider’s office. Notably, one of the things that has ensured that the Canadian health care system has been relatively well funded as things go is that every Canadian is in the same system with no outside billing by providers allowed. When the wealthy have the exact same standard of care as the poor, they don’t mind pitching in through the tax system for a quality system, and often feel proud to do so. But even Bernie has to start somewhere and providers are very powerful so maybe he figures allowing that provision is a worthwhile tradeoff.

Anyway as far as those 3 previously listed principles of Berniecare go, I wholeheartedly, full-throatedly, shout it to the rooftops agree with every single one. I can see why people want Berniecare. So why do I think Pete’s admittedly technocratic health plan is the better one?

Because Bernie and Warren are promising a unicorn.

The paradox is: How can that possibly be true if so many other countries seem to have figured those 3 principles out? The truthful answer can be summed up as:

Because the US health system is massively fucked up. Anger in response is entirely natural.

Ok so some evidence is going to be needed. Single-payer can solve some problems but it definitely isn’t a cure for the pervasiveness of greed throughout the whole industry. I actually don’t believe the people working in the health sector are bad, or could be labeled individually greedy for the most part. The problem is that the whole industry is structured around rewarding making money over improving health outcomes, in a way that is completely out of control. A lot of people are getting rich in the health industry for reasons that clearly don’t correlate well with overall national health outcomes. The whole sector is in need of extensive reforms of the type that most candidates aren’t even ready to talk about. Basically I contend that single-payer as written, objectively cannot be implemented until other reforms are enacted. In fact, I would go as far as saying single-payer might even be called a “tinkering around the edges” solution to the overall problem. Bernie makes the case best with his own facts. Some important (rough but ballpark- please do check) numbers:

(all figures annual unless otherwise indicated)

21 Trillion — US GDP last year

3.8 Trillion — US Health Sector spending last year — 18% of GDP — a MASSIVE number — bigger than the entire GDP of the UK or Brazil. It is about half and half private and public spending, with private slightly more I believe but the numbers are conflicting depending on the source

12% of GDP — The next most expensive health system in the world: Switzerland

79 — Life Expectancy in the US

83- Life Expectancy in Switzerland

Every Swiss person has time to complete an extra Bachelor’s degree in the time granted by their expensive health care, imagine how long they might live if they decide to spend 50% more to match US spending?

3.7 Trillion — The Grand Total of all US Federal Government Revenue

4.8 Trillion — The Grand Total of US Federal spending

1.1 Trillion — The US Federal Deficit

Ok now for some important numbers that might be affected by M4A:

0.5 Trillion — US Health Care Administrative Costs (this is about 3 times as much as Canada percentage wise)

0.33 Trillion — US spending on pharmaceuticals

0.05 Trillion — US pharmaceutical industry profits — in some cases up to a 42% profit margin

0.026 Trillion — US private insurance industry profits — about a 3.3% profit margin last year

For context

0.68 Trillion — The US Defense Budget

0.6 Trillion — The Amount The GDP declined during the great recession of 2007–2008

So just pause for a second and think about how careful you have to be when attempting to restructure a sector of the economy that approaches those numbers in size. I’d be a little scared to flip a switch. But it definitely would be the right thing to find a way to get done if it was that simple.

Also, look at those numbers for pharmaceutical profits and insurance industry profits — they just might be the evil bogeymen of this whole debate. They are definitely morally problematic, and are often related very closely to the situations where out of pocket health costs threaten to bankrupt an individual who can’t afford to cough up a portion of those profits (for the benefit of the shareholders and executives of those companies). So yeah, it doesn’t engender a whole lot of good will. But objectively those numbers are actually really small potatoes when it comes to the overall size of the cost problem in US healthcare. There are all kinds of other profiteers that make up a much bigger slice of the problem. For example:

2 Trillion — The approximate amount of health spending (53%) that goes to Hospitals and Physician/Clinical providers

Pete is the first candidate to concretely commit to reining in provider costs (source: tweet from a health policy expert who presumably follows all the other campaigns)

Private insurers reimburse 40% more than Medicare for the same service. Somebody can do the math for me on how much that would affect the 2 Trillion but it’s a lot. The way M4A was originally written to reimburse at Medicare rates would be disruptive, not politically feasible at all, and quite dangerous, if paradoxically desirable in the sense of containing costs. It has since been walked back to where there is actually no policy on this question in M4A. Many providers claim they would have to close if all of their care is reimbursed at Medicare rates, and this is probably true because most providers are spending that extra money on everything from salaries to fancy technology to private rooms at a hospital, costs that can’t be clawed back easily at a moment’s notice. Bernie’s argument that overall health spending will decrease under his plan largely rests on where he comes down on this reimbursement rate issue that hasn’t really been resolved.

Another neglected area of discussion: absolutely nobody is talking about doctor salaries in the US, which are the highest in the world. Canadian doctors make less than half of the take home pay of US doctors in some specialties and are still considered very well compensated in global terms. What do American doctors do to earn that double salary? Maybe put up with the nonsense of the billing practices and the increased likelihood of being sued? It would probably be untrue and unfair to suggest that being 4 times as likely to be sued for malpractice in the US is symptomatic of the competence of US physicians, but likewise I think the case could be made that Canadians are getting excellent physicians for half price. Huge malpractice insurance premiums are baked into the cost of care in the US, and maybe the most expensive consequence is the tendency of physicians to order tests that are not supported by clinical evidence in order to protect from malpractice risk.

Why is this all important? Because Berniecare aims to provide a whole lot of care that isn’t currently being provided in the US. I saw a statistic that 40% of people forgo care because of the expense, and that things like mental health and addiction issues are being treated at incredibly low rates to what is needed. It is guaranteed that a system without copays or deductibles or uninsured people is going to result in a massive demand for needed care. This is a good thing. Unfortunately with Healthcare looking to top 20% of GDP soon even without the M4A bill, the question of how to pay for it seems crass and immoral but also profoundly necessary to answer. Because here comes the next number:

32 Trillion dollars

I’ll let that one sink in for a bit while you go back and look at all of the other numbers I put up there so far. That is the consensus best guess between about 8 expert studies that tried to estimate how much the M4A bill would cost the Federal Government in new Federal spending over the next decade. Bernie himself says between 30–40 Trillion. Here’s another one:

0.94 Trillion

That is the total cost of Obamacare (ACA) over a decade. So Bernie argues that 50 Trillion would need to be spent in some form if we keep the system as is, but I haven’t found any numbers that back that figure up comprehensively (I’d be open to learning more). Ok so let’s break it down:

3.2 Trillion Dollars: Average New Expenditure by the Federal Government to pay for this bill each year for the next decade. Compare that to the 3.7 Trillion in current total revenue for the federal government. Revenue would have to nearly double to pay for this bill.

Ok so how does Bernie want to do it? He has a list of “options” on his Senate website. Options being maybe the most ironic word I have ever seen used. Maybe ever period.

This is the list of what he calculates he can bring in over a decade:

3.9 Trillion — 7.5% Employer Paid Payroll Tax

3.5 Trillion — 4% Household Paid Payroll Tax

4.2 Trillion — Savings from Health Tax Breaks (I saw this figure fact checked at an order of magnitude smaller than this, but we’ll go with it)

1.8 Trillion — Make the Income Tax Code more progressive

0.249 Trillion — Increase the Estate Taxes

1.3 Trillion — Wealth Tax on 0.1%

0.247 Trillion — Close a loophole on payroll taxes for wealthy businesses

0.767 Trillion — Impose a one time tax on offshore profits

0.117 Trillion — Impose a fee on Wall Street

0.112 Trillion — Get Rid of Accounting Gimmicks

Ok so a few things. If you get a calculator and add up all of these “options” it comes to about 16 Trillion Dollars, or about half of the additional revenue required to fund this bill over the next decade. He’s basically proposing to run a 16 Trillion dollar deficit over the next decade for this one bill. Go back and contemplate how big that number is. And he seems to have thrown the entire kitchen sink of proposals to generate additional revenue onto this list. Even if you can suspend disbelief for a second and imagine anyone would vote for all of these tax increases as well as a more than doubling of deficit spending to fund this one bill, how is he possibly going to fund any bills beyond this one? This is a total unicorn.

The other thing to notice here is just how much of this revenue comes from payroll taxes. All three of the first “options” are basically either payroll taxes or effectively the same, as they are disproportionately paid by the worker or the less well off. Bernie and Liz say that these amounts are less than the payroll taxes, premiums and costs currently paid by workers. While this is true, all of these numbers are a made up unicorn fantasy unless you can explain who is going to pay more to compensate. It’s almost too painfully apparent that all of the tax proposals that are paid by the wealthy in this list amount to tiny amounts compared to the highly regressive payroll taxes. Way to stick it to the millionaires and billionaires Bernie? I guess it’s the next generation picking up the tab…

So I guess back to Pete. He might not be offering an elegantly simple proposal. He might not be declaring quite as boldly that healthcare is a human right. He might not have written into policy his belief that fairest way to pay for healthcare is through a common and progressive taxation system. But I have total faith that what Pete proposes is what he believes is morally right, and here’s why:

I have to admit that belief in his good intentions doesn’t make up for the feeling of a kind of revulsion at the idea of preservation of the profit motive and a patchwork of technocratic fixes to a system that genuinely needs a massive overhaul. But then I remember that time he explained how he really earns his paycheck as a mayor. He said it’s not so much when you have a solution that makes everyone better off, because then it’s an easy decision and you should do it. An example might be the false promise of M4A: better and more comprehensive healthcare, guaranteed free for all, at a lower cost to all but the very wealthy. Who doesn’t want that? But actually, to Pete, moments of true leadership come when you have to make a moral decision to make someone worse off in order to make someone else better off. In the context of the mayor’s office every budgeting decision is a moral decision of this nature, as the books have to balance and limited funds are a fact of life. The truth is that there are a lot of good people in the health sector who need to be told they are going to earn less money. The problem is much bigger than the easy target of “corporate profits”. There are probably also patients who need to get less in the way of expensive but mostly ineffective care. The good news is I believe there are more than enough dollars being spent in the health sector that do nothing to improve health outcomes, and if they can be redirected in the right way to taking care of all of the ways in which the current system falls short, then at some point the US system might be as much a point of pride as it currently is for Canadians. It’s not impossible! I get the feeling a mayor brave enough to deal with the sewage so others don’t have to think about it is the right person to tackle the first steps:

-He has correctly diagnosed that the most pressing moral outrage to be concerned about is not the 26 Billion (0.026 Trillion) in insurance industry profits, but the reality of people losing their life or their dignity or their bank account because of the care or lack of care delivered by a system that is in its very design immoral. He targets the vast majority of resources in his plan to protecting the most vulnerable from the inherent risks posed by the current system.

-He calls for a public option policy that he genuinely believes will be a first step toward fundamentally transforming the whole system, likely putting the private insurers out of business through attrition.

-He was the first to call out and propose policy to cap provider costs, and this may be a wonkish thing to celebrate, but it is at least a meaningful first step to containing an out of control system beyond the usual talk about drug prices and admin costs.

- In putting together a series of policy proposals to tackle different pressing problems in the health system, he is acknowledging that the scope of the problem can’t be fixed by a few simple remedies. It seems like the mayor and his team have been under the hood doing the unsexy policy work necessary for a massive, comprehensive, and smart overhaul to the US health system. I hear a rumour there might be a pharmaceutical policy proposal today. I guess I should stop typing and go read it.

Before I go though, here’s one thing I believe even moreso than when I started this post:

Pete tries to tell the truth, and that just might be worth everything.

If you read this far, my genuine thanks to you friend. Interested to hear any thoughts. This was fun to write, so if anyone gets anything of value out of this long piece that would just be the cherry on top.