The health care system in the US is broken. It costs far more per person than other countries’ health care and its outcomes are worse – from infant mortality to life expectancy. Costs are escalating, typically faster than the general inflation in the economy. And millions of Americans don’t have health insurance and millions more have insurance with high co-payments and deductibles that could bankrupt them.

The Affordable Care Act (ACA), often called Obama Care, has taken some important steps to improve our health care system. Tens of millions of Americans now have health insurance who didn’t have it before. Elements of the ACA will improve outcomes and control costs, but these are band aids and won’t solve the real problems.

To really fix our broken health care system, we need to allow all Americans to participate in Medicare, our health insurance program for seniors. Individuals who aren’t old enough to qualify for Medicare would buy into it by paying health insurance premiums to Medicare. They would do this under the Affordable Care Act through the exchanges the ACA has setup where those without health insurance find and purchase coverage. Premium subsidies would be available for those who can’t afford the cost.

This would save money because Medicare is more efficient than private health insurance. Over 30% of health care spending in the US goes to administrative costs (e.g., advertising, marketing, paperwork, executive pay, and profits). However, Medicare’s administrative costs are only around 3%. This means that up to $400 billion a year could be saved if everyone opted to get their health insurance through a Medicare for All program. Furthermore, removing the prohibition on Medicare bargaining with drug companies for lower prices (put in place by President George W. Bush) would save additional billions of dollars. [1]

A Medicare for All program is the best way to improve health outcomes in the US while controlling costs. It incorporates many of the benefits of a single-payer system. It is effectively the “public option” that was originally part of the Affordable Care Act but was removed at the insistence of private insurers and their supporters in Congress. They didn’t want a Medicare-type program competing with private insurance because they knew Medicare for All would be more efficient and less costly for consumers.

Implementing Medicare for All is the eleventh (they decided 10 ideas wasn’t quite enough) of Ten Ideas to Save the Economy: The Big Picture presented by Robert Reich and (You can watch the 3 minute video at:

[1]       Reich, R. (2010). “Aftershock: The next economy & America’s future,” Vintage Books.


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