Democrats

For most non-elderly people in the United States, insurance coverage is tied to employment, either their own or a family member’s. This presents an obvious problem when a recession hits — especially one wrapped up in a public health crisis.

More than 16 million people have already been laid off. In the last two weeks of March alone, 3.5 million of these newly unemployed individuals lost their employer-provided health insurance. As the pandemic unfolds, that number could climb as high as 35 million, more than doubling the number of uninsured. And with the cost of COVID-19 treatment running as high as $35,000, vast amounts of people are faced with a dilemma: avoid necessary care or take on crippling debt.

For mainstream Democrats (and insurance companies), the default answer to this frightening maelstrom is to double down on the Affordable Care Act (ACA). Many Democrats, including presumptive nominee Joe Biden, have called for ACA exchanges to be opened on an emergency basis — recognizing that while some laid-off workers will have access to a special enrollment period on the ACA marketplace, others will have to wait until the fall.

But this wouldn’t make COVID-19 treatment remotely affordable. A bronze plan with no premiums still carries an average deductible of $6,506. And doubling down on the ACA isn’t just bad policy, it’s bad politics — providing Donald Trump with an opening to posture to Biden’s left and repeat the same playbook Trump used against Hillary Clinton in 2016, when he (cynically) campaigned on a promise of universal health care.

Trump

As for Trump, his zealous opposition to Obamacare may have inadvertently led him to adopt a policy closer to Medicare for All.

Trump’s solution is to circumvent private insurance entirely and send money directly to providers to treat the uninsured, with no out-of-pocket costs for the patient. This funding, which could ultimately total as much as $42 billion, will come from the $100 billion set aside for providers in the CARES Act. The funds won’t be distributed through Medicare, but Trump’s administration is using Medicare reimbursement rates.

Trump’s plan would shift the bill from insurers to hospitals, channeling all the costs for uninsured COVID-19 patients through a single payer (the federal government). Hospitals that take the funds will be banned from sticking uninsured patients with any of the remaining balance — making COVID-19 treatment free for uninsured patients. One senior official defended the proposal with a line that could have come straight from Sen. Bernie Sanders, “People want care, not coverage.”

Despite following single payer in principle, Trump’s plan suffers from massive gaps: it only covers COVID-19 treatment, not all of the other care uninsured patients need, and it fails to offer relief to those who are underinsured, i.e., those who have private plans but still can’t afford treatment.

The distribution of funds has been lacking as well. The biggest problem is that the funds are allocated based on each state’s share of Medicare payments, punishing states with larger Medicaid and uninsured populations. States like Texas and Florida have received over $2 billion while New York — a state suffering one of the most severe coronavirus outbreaks — has to make do with $1.9 billion.

A Better Solution

In his priorities for the next coronavirus relief bill, Bernie Sanders has proposed an emergency expansion of Medicare to everyone who lacks insurance or can’t afford care. For the duration of the pandemic, Medicare would cover the cost of all care for the uninsured, and would pay all deductibles, co-pays, and out-of-pocket expenses for those with private or public plans — regardless of immigration status.

House speaker Nancy Pelosi and Senate minority leader Chuck Schumer are pushing for an additional $100 billion in grants for health care providers. Hospitals need to be kept solvent through this pandemic, but the issue of hospital reimbursement rates requires a solution modeled after the UK’s National Health Service.

We should move from per-capita funding to global budgeting, a system that pays hospitals a set amount in advance instead of for each individual service. This would be the most cost-effective way to make hospitals financially stable as they take on more expensive populations and give up profitable procedures. As hospitals become more dependent on state funding, we must also look to bring them into public ownership and create a more integrated public health system.

The coronavirus pandemic is in full swing. Hospitals are struggling with collapsing profits, and the number of uninsured and underinsured is exploding. Merely defending the ACA is grossly inadequate — and a recipe for electoral disaster.