Correction (11/10/2022): An earlier version of this article stated that private spending on healthcare (e.g., employers, out-of-pocket costs, etc.) was in addition to federal spending that represented 20% of US GDP; this version has been corrected to state that the 20% GDP figure is inclusive of private spending as well. Read more here.

Welcome to another installment of Money with Katie Readers Outside the US Stare from Afar in Horrified Bewilderment—also known as, another foray into the US healthcare system.

If you’ve missed the previous two installments, feel free to check them out here:

• How to Budget for Healthcare in the US in the Least Frustrating Way Possible

• Navigating the US Healthcare System Without Getting Financially F***ed

We’re covering open enrollment dos and don’ts on The Money with Katie Show this week, but I also wanted to pop off a little bit on the topic—and I figured it made sense to address three of the most common misconceptions I hear about how single-payer healthcare systems work.  

For the uninitiated, welcome to the dark side! Per Harvard Medical School (emphasis mine): 

“In a single payer healthcare system, rather than multiple competing health insurance companies, a single public or quasi-public agency takes responsibility for financing healthcare for all residents. That is, everyone has health insurance under one health insurance plan, and has access to necessary services—including doctors, hospitals, long-term care, prescription drugs, dentists and vision care. However, individuals may still choose where they receive care. It’s a lot like Medicare, hence the U.S. single payer nickname “Medicare-for-all.””

So, please consider either (a) keeping an open mind if you’re skeptical about the single payer system or (b) using these talking points in future heated debates (Thanksgiving dinner!), as necessary. I live to serve, honey!

This has been top of mind for me since our country experienced pandemic-spiked unemployment in 2020, and millions of people lost their health insurance when they needed it most—during a global pandemic. It’s estimated that 26 million American adults (around 8%) still don’t have health insurance, meaning they’re at the mercy of any medical bill that comes their way. 

The Affordable Care Act improved a lot of things. Among its most notable achievements: 

• It removed the “lifetime limits” that insurance companies could inflict (meaning, you could hit a “lifetime limit” of medical costs with your health insurance and they’d just stop covering you altogether).

• It removed the mind-numbingly cruel “cancellation” ability, wherein an insurance company that you’re paying to insure you can fabricate a reason to withdraw coverage.

• Perhaps most revolutionarily, it prohibited insurance companies from being able to reject people for having “pre-existing conditions.” (Basically, if you came to an insurance company with a spotty health history, they used to be able to be like, “Nah.”)

Sadly, though, we’re still a long way from a true single-payer system. 

While I’d consider our system relatively indefensible—it consistently ranks amongst the worst in the developed world—there are still (some) ardent supporters of the “insurance middlemen” system, who believe a single-payer system would somehow be worse than what we have now. 

Why do some people still so fervently support and defend this “middlemen” system? Well, because it’s massively profitable for those who stand to benefit from the big payouts. And while it’s fair to be concerned that a universal healthcare system might kill jobs, I’ve yet to see anyone study how many jobs insurance executive bonuses have killed (but more on that later).

To those supporters, I say: Come along with me on a myth-busting journey. Please keep your hands and feet inside the vehicle at all times. We can’t afford any ambulance rides to the ER.

Myth #1: “A single-payer system would be more expensive than the system we have now.”

Unfortunately, our current healthcare “system” (it’s technically more accurate to call it a healthcare marketplace, but I digress) is incredibly expensive to maintain. 

Just how expensive? The countries with universal healthcare systems that consistently receive top marks (think Norway, the Netherlands, Australia) spend nearly half as much as the US as a percentage of GDP (and when measured by “per citizen”).

Healthcare spending (Medicare, Medicaid, private insurance, etc.) in the US represents nearly 20% of our total GDP, compared to the aforementioned Norway, the Netherlands, and Australia, which spend between 10% and 11% of GDP on healthcare systems that cover everyone. 

And remember, we’re paying more for a privatized system—it’s almost as if the American taxpayer is subsidizing the massive profits reaped by insurance companies. 

Doesn’t exactly scream “fair” to me, but hey, what do I know? Decide for yourself:

A healthcare marketplace with for-profit middlemen isn’t just worse for taxpayers. It’s also worse for the private employers (everyone from Fortune 100 companies to small businesses) who bear the brunt of employees’ health insurance, if they choose to provide it. This creates rising costs that strain American companies.

The average “employer and employee” together spend more than $22,000 per year for an employee’s family health insurance coverage (which is separate from the amount the family pays in deductibles, copays, or coinsurance). If you’re single, your boss pays around $7,800 for you as an individual.

Let’s take a rage cheerleading break: G-R-I-F-T—what does that spell?! American health insurance!

That means even if your employer covers everything (and you have no premiums or deductibles yourself), your compensation is still many thousands of dollars lower than it could be if your employer was not responsible for paying thousands (if not tens of thousands) of dollars to insure you. 

The point is, our system is incredibly expensive for everyone involved—government, employers, and employees.

Perhaps it’s most expensive for the uninsured, who have to navigate jacked-up medical bills that exist in response to the insurance middlemen taking a 15%–20% cut of every transaction.

Often, people will respond to conversations about single-payer systems by saying, “Well, if I didn’t have health insurance, my XYZ surgery would’ve been a million dollars!” But that’s precisely the point—without the for-profit health insurance industry, the sticker price wouldn’t be seven figures. The prices are fake. It’s no surprise medical bills are the leading cause of bankruptcy in the United States.

A single-payer model would almost certainly be cheaper for taxpayers, employers, and employees, which would help to buoy wages that are suppressed by exorbitant, employer-sponsored insurance premiums.

Hell, even a study funded by the infamously soulless Koch brothers saw that a single-payer system would save the US $2 trillion over 10 years.

That’s why when you think about the “cost” to you, you can’t just look at what you’re paying in premiums or deductibles—you have to consider the percentage of your tax dollars going to the system (remember, it represents more than 16% of our total GDP) and the amount your employer is paying on your behalf that would otherwise land in your pocket instead.

But hey, I’m really happy for Cigna’s CEO, who took home more than $91 million in 2021 compensation, or the few lucky execs who earned hundreds of millions. I’m sure they’re thriving!

TL;DR: A single-payer system would make this entire mess more efficient, and therefore less expensive, because there’s now ONE massive entity—the US government—representing most people, with major bargaining power. Of course, most other wealthy nations also have private doctors you can visit and pay out of pocket if you want premium, immediate care, but the important part is nobody’s left behind in a single-payer model. Plus, taxpayers and small business owners alike aren’t left sponsoring the bonus packages of Aetna’s C-suite.

Myth #2: “A universal healthcare system would eliminate consumer choice.”

Au contraire, my libertarian friend! A single-payer system would increase consumer choice, because you’d still have the option of visiting any doctor for any reason—but now, there’s no such thing as “in-network” or “out-of-network.” No more networks! Just doctors—and one universal health insurance card that’s presented for payment.

In the US today, there are 10 healthcare administrators for every one doctor, creating incredible bloat in the system. Instead of the world we have now wherein 25%–33% of all premiums pay for paperwork and administrative costs in a complex multipayer system, you’re now freeing up medical staff to not spend half their day working on paperwork and talking on the phone with insurance companies. 

Another common, related myth is that the “government would control your healthcare outcomes.” But guess what, babe?! Someone else already does! And it’s not the publicly elected officials accountable to you, whom you have the ability to vote out if you think they suck—it’s the CEO of Clover Health, who wants to ensure he’ll continue earning his $390 million per year compensation package.

An insurance company can deny coverage for something a medical professional thinks you need, and boom—you’re up a creek, now funding the insurance-inflated price yourself with a creative and well-written GoFundMe campaign (or going without potentially life-saving care).

To believe you’re in control of your health outcomes in the US—where private insurance companies are more focused on hitting their Q4 profit goals than your care—is a farce, and a dystopian one at that.

Myth #3: “Healthcare will be slower and worse if we have a single-payer system.”

While I’m not sure how it can get much slower or worse than it already is (I had to wait two months to see a general physician; I have yet to enjoy the “speed” our system’s defenders are always referring to), the data just doesn’t support this claim.

This is a popular talking point that relies on fear-mongering to keep Americans stuck in our shitty, broken system—but per the World Population Review, “data from nations with universal coverage, coupled with historical data from coverage expansion in the United States, show that patients in other nations often have similar or shorter wait times.”

The average wait time to see a general physician in the US is 26 days in 2022, which is 20 days longer than the average wait time to see a general physician in France, a country with universal coverage. 

28% of Americans wait longer than a day to see a doctor, compared to only 24% of Swedes, 22% of Norwegians, 14% of Australians, and 13% of Germans. The only country with longer wait times than the US? Canada.

While specialist wait times are a little more variable, citizens of Switzerland, the Netherlands, and Germany all wait less time on average than Americans to see specialists.

When we were traveling in Norway, my husband felt ill—we called a local hospital (unaware of whether it was private or public, because the website was in Norwegian and your girl hasn’t brushed up on the language) and—within two hours—a doctor was in our hotel room with all his supplies, conducting multiple tests. 

He told us he was a private doctor, and it would’ve taken “much longer” for a public doctor to arrive. 

“How much longer?” I asked, trying not to wince—my beliefs about universal healthcare systems hinging on his answer.

“Oh, at least four hours.”

I laughed so hard I nearly cried. 

Still, the house call ran us $400, as he was a private doctor who arrived at our room in under two hours to conduct a multitude of tests and we aren’t Norwegian citizens with health insurance in the country. 

But an out-of-pocket uninsured cost of $400 for extensive testing during a speedy house call? 

Be still my American heart (but not really, because I can’t afford an American cardiologist and I’ve been slacking on my Cheerios Oat Crunch intake). 

This erroneous concern—about care becoming slower—is reflective of the core fear that things will somehow get worse. And to that, I say: Friends, it hardly has room to get worse. The way our system is currently built incentivizes worse health outcomes.

Take the pharmaceutical industry, as another example. Think about the incentive model at play: Rather than dealing with the root causes of whatever ails you to actually fix the problem, they’d rather put you on medication for the next 40 years so you’ll be a recurring customer. The most prominent type of health communication the American public receives? Pharmaceutical advertising, which has been increasingly deregulated.

Not to mention the obvious reason health outcomes in the US are worse: If you’re fearful that a trip to the doctor will run a four-figure bill, how likely are you to go unless you think you really need to? Any healthcare system that actively, financially disincentivizes interacting with it will—almost certainly—create worse health outcomes over time. 

There’s bipartisan support, but private interest groups (and their fat budgets) create strong opposition

Two of the books I’ve read on the topic—one incredible exposé by T. R. Reid called The Healing of America and another scathing criticism by Marty Makary called The Price We Pay—showed me there’s bipartisan support for the idea that our healthcare system is busted. Authors on both sides of the aisle come to very similar conclusions.

We need to vote in a way that makes it clear we care about fixing this system. CalCare was an attempt earlier this year at creating an “everyone in, nobody out” universal healthcare system in California, but unfortunately, it didn’t pass, thanks to strong opposition from private interest groups representing Big Healthcare.

If you like the sound of more money in our pockets and a lower chance of being obliterated by medical bankruptcy, it’s in all our best interests to support candidates who will fight for a single-payer system.