One Vast Pyramid Scheme

Anyone who follows American health care discourse for long enough will eventually hear a line like this: “Single-payer advocates are not writing on a clean page, but rather seeking to reconfigure an enormously complex structure that consumes one-sixth of the national economy and employs hundreds of thousands of people,” as the Atlantic warned.

It’s easy to lose sight of what exactly that means. It means, more than ever, climbing medical bills alongside eye-popping payouts for the executives who formed PAHCF. It means that a substantial portion of the economy of the world’s richest country is built on the promise that the health care industry must continue to grow, at an even faster rate than it’s growing now, to pay off the loans and investors that enabled the industry to get so big in the first place.

Take hospitals, for example. Whether investor-owned or not, in our profit-driven system, they have to attract patients. They’re under pressure to generate a profit (or “operate at a surplus,” in nonprofit parlance), which they can in turn reinvest into whatever expansions or upgrades their board deems appropriate. One 2017 analysis found that the strongest predictor of hospitals expanding their invasive cardiology services was a local competitor recently having done so, whereas regions that lacked and needed such services remained unlikely to gain them. Amplifying these dynamics is the fact that whatever flashy, marketable upgrades — think lobby fountains or orthopedic wings catering to wealthy patients — that can’t be bankrolled by surpluses are instead financed with loans, whose servicing requires more revenue.

Meanwhile, those fancy hospitals become “must-haves” for insurers crafting regional networks, who would risk losing contracts to sell insurance to desirable employers if their plans didn’t include popular health care providers. After all, what patient doesn’t want access to the state-of-the-art facilities that bloated marketing budgets have helped turn into household names?

That means those hospitals have more leverage over insurers in pricing negotiations. Not that this bugs the latter too much. Because large insurers are required to pay out 85 percent of their revenue for care while keeping 15 percent for overhead and profits, rising prices make their slice of the pie bigger, too. They’re similarly accepting of obscene drug prices, driven ever upward by a pharmaceutical industry that spends less on research and development than they do on stock buybacks that deliver higher dividends for shareholders. In other words, the more expensive care gets, insurers stand to benefit so long as they keep hiking premiums. There’s simply no counterforce to keep costs low.

To make matters worse, private equity firms have been snapping up health care industry assets in recent years — “thanks to investors who have been keen on getting into a large, rapidly growing, and recession-proof market with historically high returns,” as the Harvard Business Review reports. After being loaded with debt by their new overlords, health care firms are under obvious pressure to jack up prices even further. Factor in the swelling paychecks of executives, administrators, and physicians (who are often paying off student debt themselves), and you have the makings of a structural quagmire delivering handsome winnings to a small cadre of people and institutions at the expense of practically anyone else.

Calling it a “pyramid scheme” may feel like a cliché, but that’s exactly how you’d draw it — a broad base of patients paying into a system that eventually filters upward toward entities providing nothing whatsoever of medical value, like shareholders, investors, and administrators. And while pundits wring their hands over why, exactly, health care costs keep going up and up and up, the answer is entirely obvious: because they have to, because the entire calculus of this monstrous thing is predicated on a pie that can’t ever stop growing because the richest people on Earth have already called dibs on future slices of it. And the only way of sustaining it is to keep collecting more and more money from patients — charging higher premiums and raising deductibles and co-pays. We can’t “bend the cost curve” because powerful people keep shoveling money into it with the hope of recouping even more.

But, eventually, the bough breaks. The Affordable Care Act largely failed to deliver affordable care because it did too little to squelch the profit motive embedded in the very structure of the US health care system. Ten years later, evidence of patient suffering is everywhere: seventy million Americans are uninsured or underinsured. Five hundred thousand file for bankruptcy related to medical debt each year. Patients delay treatment due to deductibles. Tens of thousands die for lack of insurance. One out of four ration insulin for cost reasons. You can trace a line from a twenty-six-year-old dying of diabetic ketoacidosis all the way up to an Eli Lilly executive cashing a year-end bonus check. The power disparity between them is the same as it’s always been.

Bringing the War Home

But we know how to stop it. When you look at the problem structurally, it becomes starkly obvious why incremental fixes — tighter regulations, a public insurance option, or beefier subsidies — won’t work. Building a just health care system demands overhauling how these firms get paid.

Under the Medicare for All bill in the House of Representatives, everyone is automatically covered without premiums, deductibles, or co-pays, and private insurance all but evaporates. Instead of being able to bilk separate payers for sky-high reimbursements, hospitals are paid a global budget to cover all the services their patients need, in the manner that a library or a fire department would. Rather than financing business-minded upgrades with profits or loans, they can apply for grants strictly for expansions in the public interest. And instead of regressively financing health care as we do now, with an employer head tax and patient contributions that fall heavily on the poor and sick, progressive taxation will redistribute the burden toward those who can most afford to shoulder it.

But libraries and fire departments aren’t at the center of a massive economic sector. In exchange for an equitable and humane system, broad swaths of one of the country’s most lucrative industries must effectively stop functioning as profit-seeking entities, quit paying off investors, and cede significant agency to the government. This is not negotiable, and there’s never been an alternate path that’s managed to achieve universal health care anywhere else in the world.

Of course, no other country in history has ever gotten there from a colossal, entrenched for-profit system, either — and imagining how we can possibly beat back what we have now to win Medicare for All is nothing short of overwhelming. But the ability of millions of people to live dignified lives hinges upon doing just that: accomplishing the impossible. There is simply no other way.

Given the scale of what we must achieve — not only wiping out the $900 billion private insurance industry, but also assuming significant control over the profits and investments of firms worth up to trillions more — the PAHCF’s hokey TV ads seem almost quaint. They’re throwing the tiniest pebble at us, and the fact that polls show we’re already wobbling should serve as a wake-up call for how much stronger the base of our movement must become. The industry bigwigs in their coalition will stop at absolutely nothing to annihilate reforms that fall well short of Medicare for All, let alone the whole project. They’ll funnel cash into super PACs, lobbying firms, and congressional elections; they’ll Astroturf a bogus army of single-payer opponents like the ones in their commercials; they’ll launch capital strikes to politically harm opponents and patients; and they’ll clog the court system with lawsuits that will be largely decided by right-wing judges groomed for their entire careers to defend the interests of capital at the expense of literally everything else. They’ll bring down whatever axes they have at their disposal to kill off state-level single-payer campaigns before they become truly viable, and they’ll deploy cheap scare tactics to terrify patients into clinging to a system that harvests their bodies for profit out of fear of something worse. And they’ll do it all with mind-boggling sums of money they shouldn’t even have, that they’ve extracted from the people at the bottom of the pyramid, all so they can keep gouging and growing until sea levels rise high enough to stop them. The prosperity of those who draw their fortunes from health care rests on the system’s inequities — it’s a life-and-death battle for them, too, and so far, they’re the only side acting like it.

We can never stop them with money, and we can never stop them with votes. But if we know that a political revolution is necessary to win, it’s almost as difficult to envision as the retreat of capital in the health care sector. Putting aside the logistical difficulty of getting enough people in the streets, over and over again, the choke points in the health care system are tough to find.

Workers can withhold their labor to take on the boss; tenants can withhold rent checks from a landlord. If patients could put game-changing pressure on doctors by not showing up for appointments, we’d have inadvertently solved the problem long ago. Hearteningly, health care workers — most notably, National Nurses United, which has endorsed Bernie Sanders’s presidential run — have escalated their demands for Medicare for All. Thus far, their advocacy has mostly entailed messaging and campaign donations, rather than militant labor actions. They, alongside coalition partners including the Democratic Socialists of America, have also engaged extensively in educational canvassing and putting pressure on elected officials to co-sponsor the House and Senate bills. While Democratic votes will ultimately be necessary to pass a bill in its final form, it’s hard not to feel cynical about how much leverage there can be in the presumably finite resource of politicians’ integrity. If their support has a price, entrenched health care interests can easily outbid constituents.

We shouldn’t hide how difficult it’ll be to win the robust, publicly-provisioned health care system we deserve. It’s not realistic, and there’s no blueprint for how to build a movement that can take on a multitrillion-dollar system and place it squarely in the hands of the people it serves. Even in the UK, it’s hard to imagine the construction of the National Health Service without the devastation of the Second World War. In short, Medicare for All necessarily entails an expropriation of private wealth that’s only ever been possible in the aftermath of cataclysm.

But despair is no option. The only chance we’ve got at winning it is by building the power of working people, wielding it disruptively, and struggling in solidarity with one another. The health care industry knows this. They’ve already staked out thousands of Iowan TV sets, looking for a fight. It’s our job to give them one.