Here's why Sanders and Warren are afraid to let you keep private health insurance

Updated: Aug 20, 2019

If you've been following politics lately you've no doubt seen Joe Biden and Bernie Sanders sparring over their plans for bringing healthcare to the entire country. Biden, former Vice President, and champion of "Obamacare," says that you should be allowed to keep you private insurance if you want. US Senator Bernie Sanders argues that the entire system must be scrapped in favor of his "Medicare for All" plan.

We've entered a very strange territory. Thanks to candidates like Bernie Sanders and Elizabeth Warren, former Vice-President Biden looks like a safe, and moderate approach to policy. This is a great topic for another article, but why is it that we only move towards the "left?" Constitution loving citizens are always having to make small compromises, but it's always a compromise in the wrong direction. For example, you'd rarely see a large nation-wide push for abolishing the income-tax, followed by a compromise of lowering the tax to 5%. The push is always for some type of extreme government control, with a compromise for a slightly less extreme form of government control. This is where the right should learn from the left. Get a guy like Bernie Sanders out there touting straight-up Socialism, and the people will settle for believing that Joe Biden's plan to create a complete government insurance option coupled with a steep rise in taxes, is "moderate."

Back to Healthcare

The fight over "Medicare for All" vs. "MO-bamacare" is likely to create a strong divide in the Democrat party. Biden's argument that Medicare for All would force 150,000,000 Americans off of their current health insurance plans and onto the government dole, is valid. A candidate like Sanders or Warren pushing the massive change-up is not likely to win with moderate voters.

Why would Bernie be so opposed to keeping private insurance in addition to a complete government option? Because he knows it wouldn't work. That's right, if a government plan is going to have a chance, it would be through Bernie's plan (which still doesn't have a chance).

Pushing for more Obamacare seems like a safe approach, but as long as people have choice, many will choose to stay off of insurance, or to go with a cheaper private option. All of this is assuming that those that choose to stay on private insurance would not pay the higher tax associated with Medicare for All. If that weren't the case, and you paid the higher tax regardless, there would really be no reason to pay for an additional private plan.

Let's assume that Biden's plan of letting you "keep your plan" includes the option to not pay the higher tax associated with the government option, but it also requires you to hold some type of insurance plan, similar to the original mandate by the Affordable Care Act (one of my top 10 "Most Ironic Congressional Act" titles mentioned in the previous article).

Bernie knows that the middle to upper-middle class and above will not choose the government option. If it is the case that you would not pay the tax if you choose private insurance, those who are making above average incomes and are in good health, would choose the private option. This leaves the same problem that we have with Obamacare, not surprising since Joe Biden is literally saying he wants to expand on the act from 2010, rather than scrapping it all together like Sanders. That problem, is that those who are healthy and/or are making decent incomes, are not choosing to go on the Obamacare option. This leaves a wide disparity in the income needed to fund the plan, since it is mainly low income and/or unhealthy citizens that are taking from the government system. The same problem will continue to exist with the expanded plan, only on a much wider margin considering this will offer a full government payment option, rather than a subsidized insurance plan.

Plain and simple- You have to get healthy people paying for the public option, and that won't happen at the level needed to fully fund the public option, unless there is no other option available.

Sanders and Warren are afraid of the Free-Market

Here's the main reason both of these radical-leftist presidential candidates are not in favor of letting you have the choice to keep your plan. Both Sanders and Warren are afraid of the "Free Market." Free market is in quotations because there is little about the insurance or healthcare industries that resemble a free market, considering healthcare is the most heavily regulated industry in America. Nevertheless, there's one thing a government program will never allow, and that's competition. They no longer allow private companies to offer student loans. They don't allow a health insurance company based in Missouri to sell insurance to citizens of Illinois. They won't allow Fedex or UPS to handle parcel post below the price set by the USPS (see this article about Lysander Spooner, the "Father of the 3-cent Stamp). To go a bit further on the mailing end of things, it is actually illegal for UPS or Fedex to put something in your mailbox. How's that for a "free market?"

The point is, the US Government has a long history of removing competition from any market where it is involved in providing a product or service. Some would call this a "monopoly," but people on the left just know it as good politics.

The private option would show the inadequacies of the public option

In a world where we have a full public, and a private option, the private option would most likely make the public look bad. That is, if the change in law doesn't enact thousands of new regulations and price controls on the private market, similar to those enacted under Obamacare. You would start to see a gradual shift of healthcare professionals preferring to take those with private insurance over those with public. The main cause behind this is that even though insurance companies are hard to shake down for payments, the government option would leave you no ability to plea for a better payment. As is the case with Medicare right now, the payment standard is set, and the laws are arranged in the government's favor. Even if you have multiple events in a hospital stay, Medicare only pays for one. That's why the cost of one event has ballooned to a high enough number to pay for any number of events, and it's a major factor in why the cost of care in general has been allowed to rise to such high amounts.

Rationing of care would likewise be a result in a total government option. I don't mean to invoke the images of "throwing granny over a cliff," but the fact of the matter is that towards the end of your life, you will be more likely to get a pill than a surgery. In addition to that, surgeries deemed "elective" would be much harder to come by for patients, in general. Remember "elective" can be expanded to mean many things, as it has been in other countries.

The worst thing that could happen for your government option, is that the private market could offer something for less money, and higher quality.

That's the reason for all the strict regulations set on the industry today by the "Affordable" Care Act. It's the reason why you are both not allowed to offer "Cadillac" insurance plans, and you are not allowed to offer catastrophic care plans. They can't have companies offering amazing plans that cover everything under the sun with a low deductible. They also can't have companies offering catastrophic only care for those that want it, because that's the cheapest option, and that's the option most needed by young people. The question is always, Why not allow those plans to be offered? So, no super-awesome plans, and no crazy affordable plans. Also you have to cover maternity care and hysterectomies for men, as well as prostate cancer for women. Almost forgot, you are confined to selling to the 5 million people in your state only, not the 350 million in the country - because it's clear that a "risk pool" becomes less risky the more people you add in it, and we can't have that.

So what about those other countries that Bernie is always talking about?

Canada has a private health insurance option. Denmark has a private health insurance option. England has a private health insurance option. Germany has a private health insurance option. Sweden has a private health insurance option. Norway has a private health insurance option. I could keep going for a bit, but I think you get the point.

The big question is, if the government option is so much better, why not allow for competition? Why not welcome it so you can revel in your amazing service that offers a better plan at a cheaper price? Why outlaw choice?

That's the 32 trillion dollar question.