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Comment by tptacek | Hacker News Reader

Yes, a challenge for major structural alterations to the American system is that the median American family is probably better off under this system than they would be under any of the European-style systems: the wage premium enjoyed by many Americans and the lower tax level offsets the cost of insurance and copays.

So when you're talking about how bad the American system is, you're really talking about a minority of its users. That doesn't make everything OK, but does highlight the political difficulty of enacting seemingly-popular changes.

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> about how bad the American system is, you're really talking about a minority of its users

It sure seems that way if a wealth family with top level insurance can still get bankrupt by medical bills. Examples of that are right here in comments.

Are you referring to the comment that roots this thread?

No need. It's a known phenomenon.

https://www.npr.org/sections/health-shots/2022/06/16/1104969...

https://rooseveltinstitute.org/publications/medical-debt/

https://www.marketplace.org/story/2024/03/27/health-and-weal...

As for income distribution

https://worldpopulationreview.com/country-rankings/gini-coef...

State GDP figures are skewed by high earners. The US is massively and systemically unequal, with far less economic mobility than the EU.

I asked a question about the comments on this thread. This isn't responsive to that question.

>the median American family is probably better off under this system than they would be under any of the European-style systems: the wage premium enjoyed by many Americans and the lower tax level offsets the cost of insurance and copays.

If you had said the median tech worker? I might have believed you, but the median family? No way.

The median family of 4 with private health insurance has a household income of around $115k not counting the gross cost of their employer-provided health care. Remember: being on private insurance puts you in a cohort that:

* Excludes everybody on Medicaid

* Excludes fixed-income seniors on Medicare

* Makes it overwhelmingly likely you have subsidized employer-covered health insurance.

Figure your employer "covers" half the gross cost of your $24k/yr health insurance (they aren't, really: that's money they'd be paying you directly without the distortion of employer-provided health care). Do the take-home pay math. Put them in, like, Ohio, or Iowa, or Colorado; just not SFBA or NYC.

Now move that same family to Manchester, take the wage hit for moving to the UK labor market, and work out the take-home pay. They'll of course pay $0 for the NHS.

Are they better off or worse off?

I'm not valorizing the arrangement, I'm making a point about how political tractable changing it is.

You’re moving the goalposts. How many families have private insurance? Considering both families with and without private insurance, is the median family better off in the US?

Idk, speaking as a big Medicare-for-all supporter, this would definitely explain why MfA always polls well at first, until people start asking if they can keep their current plan. I know at this point in the debate we’re supposed to write those people off as either innumerate, a minority, or too risk-averse for their own good, but honestly if it turned out that that stat was true, that would explain a lot.

And it would be exactly the kind of political engineering minmax scheme large corps in the US are great at: petition legislators to cut regulations so you can cut costs and maximize profits, but keep juuuust enough of the right perks in the right places so that a slim majority of people in Wisconsin, Michigan and Georgia oppose shaking things up.

The people who want to keep their own plan are almost definitionally not innumerate! They would be worse off financially under M4A.

That doesn't make M4A bad policy (I think it's bad policy for other reasons), but it does take "people are being irrational" off the table in a discussion like this.

Even if you keep your plan it's getting enshittified every year.

It's that time of year again - enroll for 2026 benefits. My employer raised employee premiums by 10%, raised the deductible, added more administrative burden such as "step therapy" (the insurance company denies your claim for a drug until you've tried a cheaper but less effective drug, even if you've already done "step therapy" while on another health plan!) Your employer will change the plan premiums and structure every single year. They can lay you off, exclude expensive drugs, exclude doctors, etc. Some specialties like anesthesiology and psychiatry are usually not in network. In extreme cases an employer can change health administrators mid-year and your deductible will reset.

https://www.pwc.com/us/en/industries/health-industries/libra... https://kffhealthnews.org/news/article/workplace-health-insu...

Why does Medicare for all mean I can't keep private health insurance? There are countries that have systems like this in place.

There are countries that have single-payer systems and widespread supplemental insurance. But if you universalized Medicare, you'd immediately do at least two big things to the market:

(1) You'd eliminate the system of advantages and supports that cause employers to offer private insurance, which is where most people get their insurance from.

(2) You'd create a huge adverse selection problem --- the more effective/useful Medicare is, the fewer families will want to spent $24k/yr on private insurance, meaning the families left on private insurance have a reason to want it, meaning the composition of the risk pool would shift dramatically.

Like, if we ever did M4A, we'd probably end up with a widespread system of supplemental insurance; we already have it with Medicare! But that's not the same thing as keeping your existing plan.

I don't understand the obsession some people have with keeping your existing plan. Lots of people can't keep there plan under the current system. Insurance companies update their plans regularly. Sometimes they remove plans or exit markets entirely. An existing plan will get small changes over time. If Theseus has an insurance plan for 10 years and the insurance company makes changes every year can we still call it the original plan of Theseus?

If M4A plus supplemental insurance gives me about the same coverage I have now for a reduced total cost that sounds like a win to me. Even if it ends up costing me the same amount the net improvement from everyone having access to basic health care would still be a win.

Every policy is easy to enact if you just define away anybody who'd object to it. But, more importantly: it's unlikely that M4A by itself (let alone with the supplemental plan you'd likely end up with) would reduce your total cost!

> Yes, a challenge for major structural alterations to the American system is that the median American family is probably better off under this system than they would be under any of the European-style systems: the wage premium enjoyed by many Americans and the lower tax level offsets the cost of insurance and copays.

The US spends nearly as much in taxpayer funds as a share of GDP as other developed countries (and vastly more on a per capita basis), with even more in private costs on top of it. It is simply dishonest to say that the "wage premium enjoyed by many Americans and the lower tax level offsets the cost of insurance and copays", because neither the US wage premium nor any lower tax burden are attributable to differences in healthcare systems, but rather are in spite of the far greater burden of the US healthcare system.

OTOH, it is true that a major challenge is that people respond with this line to any proposed major structural changes to the US system.

Again, you can just do the math on this. You're making an argument about the macro costs of our system --- I think those costs are fucked, too. But I'm not talking about that; I'm talking about the actual experience of an ordinary middle-income family with private health insurance. That family would likely (in fact, almost certainly) be worse off in a single-payer system.

I'd appreciate if you'd avoid using language like "simply dishonest" with me in the future. It's easy to tell me I'm wrong about something without accusing me of commenting in bad faith. This is in the guidelines. Thanks in advance!

> Again, you can just do the math on this. You're making an argument about the macro costs of our system --- I think those costs are fucked, too. But I'm not talking about that; I'm talking about the actual experience of an ordinary middle-income family with private health insurance.

Yes, you can just do the math, and changing nothing about the US except transition to a European style universal system, the median family would face lower aggregate tax, out-of-paycheck, and out-of-pocket costs than they do now, with less health insecurity around unexpected events (either health or employment), unless the tax increases necessary were deliberately and perversely targeted to avoid that.

That’s a direct consequence of the difference in the macro-level costs: they aren’t separate, orthogonal concerns. People just have a hard time accepting that the US health care system is structurally constructed right now to waste vast hordes of money preventing people from accessing health care, but that’s exactly what it does.

Provide numbers. Sanders, for instance, funded his proposed system by (among other things) taxing capital gains at the level of ordinary income.

I'm critical of the US system, but I have exactly the opposite diagnosis you do: my concern with the system is that, by the numbers, it appears to function by driving way too much spending on "actual" care.

> Provide numbers. Sanders, for instance, funded his proposed system by (among other things) taxing capital gains at the level of ordinary income.

Not tax penalizing non-capital income is sort of an essential reform in the era of increasing automation anyway; I'm not sure what point you are trying to make there. The average middle income family isn't making a substantial share of their income in forms taxed as long-term capital gains, so that seems...unrelated to the focus of your argument.

> I'm critical of the US system, but I have exactly the opposite diagnosis you do: my concern with the system is that, by the numbers, it appears to function by driving way too much spending on "actual" care.

It does both (particularly, in the “actual care” angle, as regards low-benefit, high-cost measures near the end of life.) We have a system based on denying and economically incentivizing younger people to avoid and defer care, but then doing much less of that with (most of) the elderly.

You're contradicting yourself. You took me to task earlier for factoring in the wage penalty for working in the UK market --- fair enough, though really I'm making the simple descriptive point that people in the US are accepting of a dysfunctional status quo in part because they would be worse off in Europe.

But taxing capital gains at the level of ordinary income would be an immense change our tax code. All sorts of things the broader economy would change as a result. If you accept Sanders plan, you're not holding to your original constraint of changing only the health financing system.

I want to be clear that I'm not stipulating that families would be better off under M4A if you didn't do this: I still think your argument has the fuzzy end of this lollipop. I think it's unlikely that you will come up with a set of numbers for any proposed single-payer health system that leaves the median family with private health insurance better off on a take-home basis. I'm making a strong claim, so you should be able to knock it down straightforwardly if I'm wrong, and I'm interested to see if you can.

The counterargument is simple - it works in other countries.

Other countries have healthcare systems that don't generate medical bankruptcies, and don't put a slaver's chain around the necks of employees who risk financial destruction if they have to give up an employer-funded plan.

You're essentially arguing that 500k medical bankruptcies every single year, out of a population of 340 million, is a small price to pay for an imaginary financial benefit that you're convinced exists, for some loosely defined demographic, but which you've failed to quantify.

This is, very specifically, the problem that destroys your argument.

Some people in the US are better off until they aren't.

One serious medical crisis - like an extended bout with cancer - is enough to wipe out the benefits, and leave people who used to be prosperous out on the streets.

Literally. Not as an exaggeration, not as rhetoric, but as a cold, hard reality that affects half a million people every year.

You're responding persuasively to somebody's argument, but it isn't mine. I'm talking about the large cohort of American voters who would be worse off under a single-payer system.

There is a middle ground here. Many European countries do not actually have single-payer, but still perform better than the US.

It's a bit out of date now but the book The Healing of America found that Germany, France, and Japan had world-leading healthcare results, measured by things like survival time after major disease diagnosis, but spent much less of a percentage of their GDP on healthcare. None of them had single-payer. Their systems were pretty close to the ACA, with private insurance companies and a mandate.

They were also different than the US in certain ways. Probably the biggest was a national price list for services. A lot of healthcare isn't really a functioning market; in many cases you're in no position to comparison shop. A result of the price lists was that doctors made a lot less money, but this didn't seem to affect quality.

Other differences included: no claim denials allowed for anything on the price list (which saves a lot of administrative staff), effective national digital records systems (ditto), and the insurance companies had to be nonprofits.

All three countries actually got better bang for the buck than Canada's single-payer system. Japan was the cheapest, spending only 5% of their GDP on healthcare, despite an aging population of heavy smokers. Germany was the most expensive at 13% (compared to US 18%) but covered things like week-long visits to the spa for stress relief.

The author did a spot check on the user experience by seeing a doctor in each country for a shoulder problem, and those three countries worked out really well for him. In Japan the doctor offered surgery the next day, at a very modest cost. They did make do with simpler equipment; the MRI machines were bare-bones but they got the job done and a scan cost $100.

I agree. I'm a fan of the non-single payer European systems, and, especially, of the Australian system. Nobody can look at the American system and say we've got it right! I do like the private->Medicare compromise we have, but we also have the original sin (a strange and I think unintended consequence of the mid-century tax code) of employer-sponsored coverage.

I don’t know if the median American would be worse off with a European style system. Certainly the 1% don’t need it. I’ve been on the Google health insurance before and it made me feel like I had $10 million in the bank.

Can I ask what the Google health insurance is like?

I've been lucky with my health so I don't have a huge list of interactions:

* Free tele psycho-therapy. Not sure what the limit is but it's >= 2 hours per week. I even cancelled same-day once with no fee. The quality of the care was also very high.

* I developed wrist pain from typing, holding a Steam Deck, starting pull ups. I was able to see a physical therapist at the Google office (through an embedded One Medical) after 1 week. No referral needed. Saw them once per week for 5 weeks paying $20 co-pay each time. They fixed my issues permanently.

* I also occasionally used the Google One Medical locations (and public ones) for injuries from a low speed bike crash, vaccines, etc. Don't think I ever paid more than $20 for anything. On a Google income that amount is completely inconsequential.

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