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Thursday, January 21, 2016

The Lessons of Vermont That Bernie Didn't Learn

We know he didn't learn from it because when asked about Vermont's experiment with single payer last Sunday his pithy answer was that it was Vermont Governor Peter Shumlin's plan not his.

http://lastmenandovermen.blogspot.com/2016/01/why-doesnt-peter-shumlin-support-bernie.html

Ok, so what would make a Bernie Sanders single payer plan different than a Peter Shumlin plan that was in a very small, progressive state?

The lack of responsiveness to the question doesn't give you much faith that he can learn from it and do a better job. Robert Reich has become a Bernie cheerleader:

"His single-payer healthcare proposal would cost so much it would require raising taxes on the middle class."

"This is a duplicitous argument. Studies show that a single-payer system would be far cheaper than our current system, which relies on private for-profit health insurers, because a single-payer system wouldn't spend huge sums on advertising, marketing, executive pay, and billing. So even if the Sanders single-payer plan did require some higher taxes, Americans would come out way ahead because they'd save far more than that on health insurance."

http://www.huffingtonpost.com/robert-reich/6-responses-to-bernie-skeptics_b_9008636.html?ncid=edlinkushpmg00000090

But that's just the theory not the details. I guess as the devil's in the details and Bernie is such a Saint he won't stoop to get into them.

But the real tough part is selling this politically and then implementation. After implementation is the transitional period.
 
In Vermont this was tough enough that Peter Shumlin had to table it. 
But no matter what, there are tradeoffs in single payer. It doesn't magically make everyone better off. It may well make many low wage folks better off but many other middle class folks happy with their generous healthcare plans would either lose care or see their taxes go up. 
This was Hillary's lesson in her own aborted try at something close to single payer in 1994. As Ezra Klein explains it her lesson was 'Don't screw with what people already have.'
But while many might be better off, a good number wouldn't be. Even in progressive Vermont, the question of how to pay for it was never resolved. 
"Vermont's single-payer bill, Act 48, had a detailed list of what it would and wouldn't cover (preventive care made the list, whereas dental did not)."

http://www.vox.com/2016/1/20/10793864/sanders-single-payer-vermont

This touches on another issue with single payer. To make it work on a cost basis you have to engage in rationing care. Again, folks currently with a generous healthcare plan will lose that-to keep down costs, while also seeing their taxes go up to pay for it.

As for how to pay for it-this never came up.

What it didn't include was a plan for how to pay for all that health care — or even an estimate of what it would cost. Some now reflect back on that as an ominous sign for what would happen next.

"I was skeptical when the original bill passed," Peter Galbraith, a Vermont state senator, said. "When you pass a benefit and don't say how you're going to pay for it, it raises the obvious question of, 'How are you going to pay for it?'"

"The answer, for Vermont, was a disheartening one: The state wouldn't ever pay for the plan. By December 2014 — more than three years after Act 48 became law — the Shumlin administration had run the numbers dozens of different ways. And its analysts had found that it would cost $2.5 billion to buy coverage for all Vermonters."

"In Vermont, this was massive: The state only raises $2.7 billion in taxes a year — the single-payer plan would mean doubling tax collections. The Shumlin administration estimated it would need to increase payroll taxes by 11.5 percent and income tax by 9 percent. That's a big lift even if it would replace existing health premiums."

http://www.vox.com/2016/1/20/10793864/sanders-single-payer-vermont

Bernie did the same thing this campaign. He didn't want to admit that middle class taxes would have to go up at all. Then he didn't want to release his plan till after Iowa and NH voting.
I also find it interesting that Governor Shumlin-Bernie's Governor-doesn't support Bernie though he supports single payer. Shumlin trusts her on healthcare not Bernie. This is very telling. Bernie is not the right guy to be President which requires building coalitions. 
That he gets no support from anyone he's worked with or his own state tells us a lot. It's why I argue he's the Ted Cruz of the Left. 
http://lastmenandovermen.blogspot.com/2016/01/bernie-sanders-is-ted-cruz-of-left.html

Krugman also read the Vox piece.
"Sarah Kliff has a very helpful account of Vermont’s attempt to create a state-level single-payer health care system, and why it failed. It’s a bit like the old joke about the farmer, asked for directions, who says “Well, I wouldn’t start from here.”

"The point is not that single-payer is a bad idea. It is that given where the U.S. is now, achieving the kind of low costs we see in other countries would involve imposing large losses on many stakeholders, including people with generous policies, health care providers, and more — which is the point I’ve been making. The gains would almost surely be bigger than the losses, but that’s not going to make the very hard politics go away."

"And just assuming, as Bernie Sanders does, that you can achieve dramatic cost savings without considering how you’re going to deal with the stakeholders — and therefore lowballing the actual cost of the plan — isn’t helpful, and amounts to not really leveling with your supporters."

http://krugman.blogs.nytimes.com/2016/01/20/lessons-from-vermont/?module=BlogPost-Title&version=Blog%20Main&contentCollection=Opinion&action=Click&pgtype=Blogs&region=Body
Right. In Vermont they didn't level with them until it was too late and the plan had to be aborted.

Finally, Krug ends with an important point I have before in defending Obamacare against the boobirds of the Left who say it didn't go far enough:

"Remember, Social Security originally only covered half the work force, and more or less systematically avoided covering types of employment — agriculture, services — that employed African-Americans. So should we condemn FDR for his cynicism, or say that idealism with no possibility of results isn’t helpful?"

The ACA can be improved on. It doesn't cover everybody but it covers 20 million who previously weren't and it will in time cover more. 



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