An attack ad by Gov. Larry Hogan (R) paints the health-care plan proposed by his Democratic opponent, Ben Jealous, as irresponsible and unaffordable. But the dramatic number it relies on — $24 billion — was gleaned from state analysts who based their work on a study suggesting such plans could save money overall.
The ad says Jealous’s “risky plan for health care will cost at least $24 billion a year. Every year.”
That figure considers only half the trade-off at the heart of Jealous’s proposal — a “single payer” or “Medicare for all” plan of the sort that has gained increasing support among progressive Democrats in recent years.
Patients don’t typically pay their doctors directly for their health care. Often, they pay premiums to insurance companies, which then pay doctors. The idea of a single payer is to replace the various insurance companies with one payer: the government. Instead of paying premiums to a health insurance company, people would pay taxes to the government, which would be responsible for paying their doctors.
“We believe the savings would offset the cost while offering much more comprehensive coverage to more people,” Jealous spokesman Kevin Harris said last week.
Hogan’s $24 billion price tag for a single-payer system came from an analysis that Maryland’s Department of Legislative Services did last fall at the request of an individual lawmaker.
The department has refused to release the full analysis on the grounds that it was done confidentially for the lawmaker.
But a summary of the analysis says the government would have to spend $24 billion to fund the system. The analysis did not say how much state residents and businesses are spending now on health insurance, so whether costs overall would increase or decrease — and by how much — was not clear.
Jealous has acknowledged that his single-payer plan would be funded by tax increases — as any single-payer plan must be. His contention is that, overall, with health-care premiums and costs rising sharply, people would save more paying the government to cover their health care than they could in the current market.
“Total health-care spending has increased by more than a trillion dollars in the last decade while premiums in Maryland have continued to increase by double digits in recent years,” Harris said. “We would argue the current system isn’t working, and is on an unsustainable path.”
While the idea of a national single-payer plan has become increasingly popular among Democrats, Jealous and others have advocated for states to go it alone and lead the way.
Some academics say that, in theory, Jealous and other single-payer proponents may be right. One study, by researchers from the Political Economy Research Institute at the University of Massachusetts-Amherst, looked at California’s single-payer proposal and concluded that it “could provide decent health care for all California residents while still reducing net overall costs by about 8 percent relative to the existing system.”
Maryland’s legislative analysts used the study to guide their report on single-payer systems. The analysts also issued a public report on a bill, HB 1516, that was introduced early this year and proposed a single-payer system, but was later withdrawn. That analysis said any savings realized by the state would likely be lower than those anticipated by California, because Maryland has already driven down some of its costs through a government commission that sets prices for hospital care.
While Hogan’s campaign asserts that single-payer systems have already been tried and failed in California and Vermont, no U.S. state has actually attempted single-payer health coverage.
A proposal in California passed the state Senate, but was put on hold in the Assembly. A proposal in Vermont was passed but not implemented.