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Analysis

CBO Balks on Cost Estimate for Single Payer System

By John Commins  
   May 01, 2019

A new report says transitioning the nation's $3.5 trillion healthcare system to a single-payer system 'could be complicated, challenging, and potentially disruptive.'

The Congressional Budget Office said Wednesday that government spending under a single-payer health system "would increase substantially."

However, the report didn't say how much a single-payer system would cost, nor did it say if total national healthcare spending under single-payer would be higher or lower than under the existing system.  

"Government spending on healthcare would increase substantially under a single-payer system because the government (federal or state) would pay a large share of all national health care costs directly," the report said.

"Shifting such a large amount of expenditures from private to public sources would significantly increase government spending and require substantial additional government resources," CBO said, but the cost "would depend on the system's design and on the choice of whether or not to increase budget deficits."

"Total national healthcare spending under a single-payer system might be higher or lower than under the current system depending on the key features of the new system, such as the services covered, the provider payment rates, and patient cost-sharing requirements," CBO said.

The report deferred on the single-biggest question about single-payer: How much would it cost?

"This report does not address all of the issues that the complex task of designing, implementing, and transitioning to a single-payer system would entail, nor does it analyze the budgetary effects of any specific bill or proposal."

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According to the CBO analysis, about 29 million people under the age of 65—that's 11% of the population—are uninsured in an average month. While a single-payer system would significantly reduce the numbers of uninsured, exactly by how much would depend upon the system's design.

"For example, some people (such as noncitizens who are not lawfully present in the United States) might not be eligible for coverage under a single-payer system and thus might be uninsured," CBO said.

Regardless, CBO said that because healthcare spending accounts for about 18% of the nation's gross domestic product, any changes to the delivery system "could significantly affect the overall U.S. economy."

"The transition toward a single-payer system could be complicated, challenging, and potentially disruptive," CBO said. "To smooth that transition, features of the single-payer system that would cause the largest changes from the current system could be phased in gradually to minimize their impact."

“Total national healthcare spending under a single-payer system might be higher or lower than under the current system.”

John Commins is a content specialist and online news editor for HealthLeaders, a Simplify Compliance brand.

Photo credit: Yeexin Richelle / Shutterstock


KEY TAKEAWAYS

The report punts on the biggest question about single-payer: How much would it cost?

That cost 'would depend on the system's design and on the choice of whether or not to increase budget deficits.'

While a single-payer system would significantly reduce the numbers of uninsured, exactly by how much would depend upon the system's design.


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