<p>I don't know whether you'll count this as an economic argument, but it's about the role of competition in the allocation of scarce resources, so I think you should:</p>

<p>Suppose that some disease emerges that disproportionately affects the members of some ethnic group, or is concentrated in some geographic area, or is concentrated in some population that is either in or out of political favor with the current administration.</p>

<p>Suppose also that there's some pretty expensive procedure that helps to alleviate symptoms of this disease.  </p>

<p>Under a single-payer system, one decision will be made about whether to cover the costs of that procedure.  Quite plausibly, that decision will be either made or influenced by somebody with less than pure motives.  Maybe an out-and-out bigot.  Maybe a politician looking out for the people who  support him.  Et cetera.</p>

<p>I would much prefer that that decision be made independently by multiple competing insurance companies, so that people can choose up front to affiliate with insurance companies that they believe will look out for their interests.</p>

<p>If you think this is all just  speculation, look at what happened when the government took temporary partial control of General Motors.  Politicians immediately started thinking up ways to get General Motors to make decisions that would benefit their own constitutents.</p>

<p>General Motors is one firm, and the takeover was partial and temporary.  Now imagine a takeover of the entire insurance industry, both total and permanent.  </p>

<p>You might or might not believe the attendant risks are worth taking --- but you asked what the downside is, and that's a big part of the downside.</p>

CC BY-SA 4.0
2020-03-01T02:48:12.203Z
But wouldn't the doctors be involved in that decision to conduct the procedure? If the doctors decide the procedure is medically necessary, I'd think it would be covered.
Ameet Sharma
CC BY-SA 4.0
2020-03-01T04:13:21.437Z
@AmeetSharma :  First:  If your theory is that politicians always favor the common good over the interests of their cronies and constituents, then I advise you to study history.  Second, and more to the point:  What matters is not what's "medically necessary", it's what's worth the cost.  A brilliant doctor might be able to tell you that a $300,000 course of treatment will reduce your pain level by 25%.  That doesn't make the doctor particularly good at deciding whether that's an investment worth making. Someone else will (and should) decide that.
Steven Landsburg
CC BY-SA 4.0
2020-02-29T22:19:24.653Z
2020-02-29T22:19:24.653Z
Steven Landsburg
<p>To me, medicare for all seems like a no-brainer economically.</p>

<p>The money individuals, local and state governments pay into insurance premiums, deductibles and medical costs... we simply redirect that into federal taxes that go towards medicare for all.</p>

<p>Plus we give some of that money back, because we no longer have to pay for the income to the insurance company... plus we give back money in administrative costs.</p>

<p>So the country saves money overall with medicare-for-all. What's the downside?</p>

<taxation>
What are the economic disadvantages of a single payer system in the USA?
Ameet Sharma
# What are the economic disadvantages of a single payer system in the USA?

(Asked by: username_0 on 2020-02-27)

To me, medicare for all seems like a no-brainer economically.

The money individuals, local and state governments pay into insurance premiums, deductibles and medical costs... we simply redirect that into federal taxes that go towards medicare for all.

Plus we give some of that money back, because we no longer have to pay for the income to the insurance company... plus we give back money in administrative costs.

So the country saves money overall with medicare-for-all. What's the downside?

**Tags:** taxation

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## 1 answers

### Answer by username_1 on 2020-02-29. Score: 1 | Accepted answer

I don't know whether you'll count this as an economic argument, but it's about the role of competition in the allocation of scarce resources, so I think you should:

Suppose that some disease emerges that disproportionately affects the members of some ethnic group, or is concentrated in some geographic area, or is concentrated in some population that is either in or out of political favor with the current administration.

Suppose also that there's some pretty expensive procedure that helps to alleviate symptoms of this disease.

Under a single-payer system, one decision will be made about whether to cover the costs of that procedure. Quite plausibly, that decision will be either made or influenced by somebody with less than pure motives. Maybe an out-and-out bigot. Maybe a politician looking out for the people who support him. Et cetera.

I would much prefer that that decision be made independently by multiple competing insurance companies, so that people can choose up front to affiliate with insurance companies that they believe will look out for their interests.

If you think this is all just speculation, look at what happened when the government took temporary partial control of General Motors. Politicians immediately started thinking up ways to get General Motors to make decisions that would benefit their own constitutents.

General Motors is one firm, and the takeover was partial and temporary. Now imagine a takeover of the entire insurance industry, both total and permanent.

You might or might not believe the attendant risks are worth taking --- but you asked what the downside is, and that's a big part of the downside.

> **Comments:**
> **username_0**: But wouldn't the doctors be involved in that decision to conduct the procedure? If the doctors decide the procedure is medically necessary, I'd think it would be covered.  
> **username_1**: @AmeetSharma :  First:  If your theory is that politicians always favor the common good over the interests of their cronies and constituents, then I advise you to study history.  Second, and more to the point:  What matters is not what's "medically necessary", it's what's worth the cost.  A brilliant doctor might be able to tell you that a $300,000 course of treatment will reduce your pain level by 25%.  That doesn't make the doctor particularly good at deciding whether that's an investment worth making. Someone else will (and should) decide that.  

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