December 3, 2021

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The State Road to Universal Single-Payer Health Care

If you feel a little pessimistic about the prospects for winning Medicare for All, it’s understandable. Bernie Sanders lost the 2020 Democratic primary. A deadly pandemic has not convinced the ruling class of the cruelty of a privatized health care system. The presidency is occupied by Joe Biden, who has vowed to veto Medicare for All should it come to his desk. And the likelihood that Medicare for All will reach Biden’s desk in the first place is, in any event, nearly zero. As Ben Burgis points out, even the achievement of a symbolic victory for Medicare for All in the lower chamber of Congress, before being tossed into the dustbin by the Senate, is unlikely.

In some states, however, the outlook is far less grim than it is on the national level. Single-payer bills have been introduced into eighteen state legislatures since the beginning of 2021. The prospects of passing a single-payer bill in some of the state legislatures are looking much better than in Congress.

For instance, the single-payer bill introduced to New York’s state legislature received a majority of cosponsors in both chambers for the first time in January of this year, although it was not brought to the floor for a vote in the state assembly before the end of the legislative session.

While a patchwork collection of state-based systems is no substitute for national universal single-payer health care, it would replicate some of the most important struggles to transform American society for the better — struggles that began in the states. Perhaps the road to Medicare for All begins in the states, too.

Nearly every movement for social reform in US history began on the state level, in states where political conditions were favorable. In these states, reformers built their campaigns and their organization, worked through problems in their programs, and developed their messages. These states serve as laboratories for social movements, demonstrating that reform is possible, that social movements can achieve political change, and that government can be used in the interest of the public good.

Moved by the success of national reform movements since the New Deal era, scholars and activists have focused on national movements in recounting the United States’ history of social reform. This has led them to miss important struggles, such as the antebellum campaign for civil rights, “a movement that traveled from the margins of American politics to the center and ended up transforming the US Constitution.”

Fighting for basic civil liberties, this campaign by white and nonwhite pastors, journalists, lawyers, politicians, and countless ordinary citizens has been neglected by historians and activists alike because it was conducted largely at the state level. In “courageous” states, including Ohio, New York, and Massachusetts, activists developed their arguments, their legal theories, attracted supporters, and built organizations, winning victories that encouraged others to campaign for civil rights. As Kate Masur, historian of the antebellum campaign, says:

Republican leaders of the Civil War generation had witnessed — and in many cases joined — struggles to repeal racist laws and advance the project of racial equality. Those fights gave them a vocabulary and a set of principles that they translated into national policy during and immediately after the war.

The civil rights model of the antebellum period was followed in later civil rights movement campaigns. In a few states, programs and organizations were developed, and critical early victories were won. Between 1945 and the enactment of national legislation in 1964, fair employment practices legislation was enacted in twenty-six states, first in New York and New Jersey in 1945, and last in Vermont, Indiana, Iowa, Nebraska, and Hawaii from 1963 to 1964. These state laws provided a model for national legislation, namely the Civil Rights Act of 1964.

A rally for Medicare for All in Los Angeles, California, in February 2017. (Molly Adams / Flickr)

Other reform efforts that followed the model of state-level action to gain support, build organization, and develop tactics include campaigns to win economic and political rights for women, public education, public pensions for single mothers and the elderly, support for the unemployed (including unemployment insurance), measures to regulate big business, labor law and protective legislation, and fair taxation.

In his article “Fragmented Welfare States: Federal Institutions and the Development of Social Policy,” the political scientist Paul Pierson identified three mechanisms particular to the institutional framework of the American federal republic that make local action essential to the development of social-welfare policies on a broader scale. These include: “(1) changes in the policy preferences, strategies, and influence of social actors; (2) the emergence of significant new political actors — the constituent units of the federation; and (3) a set of predictable dilemmas connected to the sharing of policymaking authority among multiple jurisdictions.”

In other words, state politics can expand our political imagination by demonstrating what is feasible, and therefore desirable, on a national level, and can provide incentives for political actors to mobilize to achieve them.

Arguably the most important example for Medicare for All activists to learn from is the history of single-payer health care in Canada. In 1947, the province of Saskatchewan pioneered the implementation of a universal health care system over the fierce opposition of the medical industry, many doctors, and right-wing coalitions, in a landscape that very much mirrors the contemporary polarization in the United States. The successes of Saskatchewan’s single-payer system, which included lower costs, higher-quality care, and expanded access to care, were praised by activists around the country, including “labor and farm organizations, consumer groups, community associations and many churches.”

Finding that Saskatchewan’s system was superior in every way to Canada’s prevailing private health insurance scheme, national figures formed the political coalitions that they would need to pass a national universal health care plan that emulated Saskatchewan’s on December 8, 1966 — less than two decades after the latter’s enactment.

Looking to the United States, we can be optimistic about how state-level single-payer action can provide the same impetus to national adoption that it did in Canada. In several of the most important historical cases of health care reform in the United States, state action served as a template for broader national policies, shaped public opinion in the direction of expansion, and created an environment in which opposition to reform was politically untenable. These include the federal-state Kerr-Mills program, which served as a template for the creation of a national Medicaid system, the passage of Medicaid in 1965, and the ongoing expansion of Medicaid as part of the Patient Protection and Affordable Care Act (ACA).

Saskatoon City Hospital (center, with the pyramid skylight) in Saskatoon, Saskatchewan, Canada. The success of Saskatchewan’s single-payer system inspired Canada to later adopt a national single-payer program. (daryl_mitchell / Flickr)

Passed in 1960, the Kerr-Mills Act was a state-federal grant-in-aid program that created the Medical Assistance for the Aged program, which ultimately served as the foundation upon which Medicare and Medicaid were enacted in 1965. States were given matching grants from the federal government to provide services to the medically indigent over age sixty-five, but otherwise were given discretion in means-testing and the “generosity” of benefits, including hospitalization, home care, prescribed drugs, and dental care.

The patchwork system meant that the number of elderly people benefitting from Kerr-Mills fell short of the legislation’s original ambitions. Nevertheless, the program’s shortcomings developed public opinion and institutional capacity leading to enactment of standardized means-tested assistance (Medicaid) and universal health care for the elderly (Medicare).

Kerr-Mills represented the first time that the federal government worked with states to provide services to the low-income elderly who needed assistance paying for medical services. The expansion of payments to states for health services helped shift public opinion towards expanded access, rendering opposition to it politically untenable.

In the 1964 presidential election, for example, Barry Goldwater’s opposition to federal involvement in health care ultimately cost him at the polls. Robert Ball, former head of the Social Security Administration, noted:

What history shows us, if you have a category of programs on a means-tested basis, it really helps you get [universal and comprehensive] social insurance later on, rather than be a final solution that people point to and say, “Well you don’t need social insurance because we already have a means-tested program.” It doesn’t work that way. People are not satisfied with a means-tested program and they will want to reduce the assistance cost by social insurance.

The experience of Medicaid expansion recalls the development of welfare policy described by Theda Skocpol in her book Protecting Soldiers and Mothers: The Political Origins of Social Policy in the United States. Skocpol demonstrates how welfare policies developed along trajectories set by established institutions devoted to a certain course of action. Following established practice, policymakers continue a certain trajectory with ever-enhanced authority and confidence. This institutional inertia was a driving force behind states’ decisions to opt into Medicaid and its expansion. A statewide single-payer system could serve this same demonstrative function.

In short, small-scale policy innovations can kickstart widespread adoption on a national level. Enacting a single-payer system on the state level could overcome the legislative and political hurdles that currently impede its implementation on a national level.

While some critics, like Tim Faust in Health Justice Now: Single Payer and What Comes Next, argue the need for federal approval poses an insurmountable barrier to the success of any state-based single-payer system, the barriers are not as insurmountable as assumed to be, and a narrow focus on them obscures the real benefits that would accrue to working-class people under a state-based single-payer system.

For instance, Faust’s concern that “the executive branch would need to approve the state’s Medicaid and Medicare waivers to adjust its allocation of federal funds to the state payer” ignores the rules governing such waivers, as a state-based single-payer could simply register under Medicare Part C. Under the current Biden administration, waiver approval may be less of a concern. Health and Human Services secretary Xavier Becerra has endorsed single-payer healthcare in the past and, while he has cooled on the idea since, we may expect that he will allow states scope to experiment.

Faust also warns, “Congress would need to pass a bill exempting the state from the Employment Retirement Income Security Act of 1974 (ERISA), the federal laws that govern self-insured employer-based plans.” However, there is no need to compel employer participation. States do not need to prohibit employers from offering health insurance to workers should they insist on wasting money on a redundant service. Regardless of what employers do, taxes will be collected to fund the program, and health care will be provided free at the point of service to all. There may be some libertarians who will insist on buying private health insurance, if any company would offer it in a state providing a free alternative. But the number of buyers would be vanishingly small.

Finally, Faust is concerned with the issue of spending: “Unlike the federal government, states aren’t allowed to ‘deficit-spend’ . . . The single-payer would need to be paid in full every year, probably through a consolidated tax on employers and employees.” The problem is that in years of economic downturn, state governments could find themselves forced to choose between cutting health care or reallocating funds from other areas of the budget (like education). This is a real problem and another good reason why we need to keep working on a national program. Nonetheless, it is not an insurmountable barrier.

States can avoid cutting health care in an economic downturn in the same way private health insurers prepare for financial troubles: by accumulating reserves in advance. The state-based single-payer would run surpluses in the good years, so reserves could be used to buffer against potential revenue decreases in the bad years.

Potential problems aside, there are real benefits that would accrue to working-class people living in states with single-payer. The current private health insurance system is funded with what amounts to lump-sum payments, where everyone regardless of income pays the same — so that health insurance premiums are a trivial expense to a CEO with a $1 million salary but a crushing burden for working people. Implementing a progressive tax scheme to fund the state single payer, combined with the elimination of private insurance premiums, would increase net income after public and private taxes for the overwhelming majority of working-class people.

The economic benefits would increase still more because state-based single-payer systems, like a national system, would reduce administrative waste and act as a check on monopoly pricing for hospitals and pharmaceuticals. Negotiating drug prices, for example, would allow state residents to buy drugs at drastically reduced prices.

For reference, the Veterans Health Administration, with 9 million members, is able to negotiate directly with the pharmaceutical industry and deliver drugs to their patients at half the price paid by other Americans. This means even small states like Washington, with a population of nearly 8 million, or Massachusetts, with a population of nearly 7 million, should expect significantly reduced drug prices. In short, all of this is to say that working-class people pay less and get more health care in return with a state single-payer system.

Working-class people living in states with single payers would have much to gain in other ways, too. Contra the scare tactics of single payer’s enemies, rank-and-file union members would not lose their good, hard-won health care; in fact, they would get better health care and better unions from a state-based single-payer system. Instead of union dues being spent on the administration of union health care insurance plans, time and money could be redistributed toward other means to empower workers, organize the unorganized, improve working conditions, win better benefits, and pursue broader struggles beyond the workplace in the name of the common good. No longer could employers use health care insurance against workers in collective bargaining or during strikes, as General Motors recently did, and as Heaven Hill is doing now.

Bernie Sanders speaks while introducing the Medicare for All Act of 2019 in Washington, DC. (Mark Wilson / Getty Images)

Nonunionized workers would benefit as well. Without the fear of losing health care with the loss of employment, workers would be better able to quit bad jobs or undertake risky struggles to unionize their workplace.

Taken together, not only are the obvious benefits good in and of themselves, but they would also help make a case for an expanded, national universal single-payer system in the face of centrist and right-wing critics.

The Sanders campaign was a cheat code. It took the socialist movement from irrelevance to national prominence in only five years. How to avoid a return to irrelevance is now the most pressing question confronting socialists in the United States. In the post-Bernie context, organizing to win state-based single-payer offers socialists the opportunity to continue their work of the last five years.

The socialist movement and the labor movement will rise or fall together. State-based single-payer provides common ground both socialists and labor can unite around to fight for a shared goal and, in turn, build a militant labor movement with the organizational capacity to take on bigger and broader struggles to advance the cause of the entire working class, such as winning Medicare for All or ending global vaccine apartheid.

If a single-payer bill passes in New York state, for example, it could inspire and escalate struggles in Massachusetts, Minnesota, or South Carolina. Through institutional support and knowledge sharing, unions and other pro-Medicare for All organizations in New York can cultivate relationships with their counterparts in other states. When political prospects improve on the national level, these unions and organizations can leverage their relationships with each other to coordinate strikes and other actions to win Medicare for All.

This is no easy task, but the only way out of the nightmare of privatized healthcare is through it.


https://www.jacobinmag.com/2021/10/state-federal-medicare-for-all-single-payer-health-care