The Wages of Bamboozlement, Or Harris’s Struggles on Private Insurance

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Sen. Kamala Harris has a revised Medicare for All plan out today. (She describes it in this Medium post.) Depending on your perspective it either tries to split the difference or come up with a creative compromise between the candidates with various “build on Obamacare/public option” type plans and those embracing Medicare for All. Stepping back we can see that this dance – which Harris struggled most to find a position on – stems from the fact that first in 2017 and then again in 2019 most of the top tier presidential candidates were bamboozled into adopting a plan which they were told was widely popular but which in fact clear majorities of the population oppose – and perhaps oppose quite intensely.

Harris’s plan shifts to a ten year phase in for Medicare for All – so no short-term elimination of private plans (4 years for Sanders), at least on paper. Then after 10 years the private health insurance system, as we know it, is eliminated. But not entirely. Beneficiaries would then be able to opt for Medicare Advantage (i.e., private insurer plans) if they chose.

This at least gets at a basic issue in this debate which has drawn very little focus, at least in the political realm if not among policy analysts. Current Medicare itself actually doesn’t eliminate private care. Roughly a third of beneficiaries choose a Medicare Advantage private plan. This is still significantly different from anything that now exists in the private market. These are private plans but they have to abide by a tight regulatory framework defined by Medicare. Of course, beneficiaries can opt back into traditional Medicare or choose a different Advantage plan if they choose, so that provides competition beyond the regulatory regime.

This gets at a basic question about all the Medicare for All plans. As described it’s actually significantly different from current Medicare, especially in how it deals with private carriers. Does that mean the Medicare Advantage model would continue for seniors but not the rest of the population? Or does Medicare Advantage get eliminated for seniors too? Harris is saying it continues for seniors and becomes a fundamental part of the national system for everyone.

As Nate Silver puts it here, Harris’s new approach seems to rely on an overly literal interpretation of the polls we discussed last week showing steep resistance to eliminating private coverage. Much of this is simply risk aversion and resistance to change people don’t have any control over. So I’m not sure it really is any more viable than the Sanders model.

Politically, what is interesting to note is how Harris is the candidate on which the cost of this earlier bamboozlement plays out. You currently have five candidates who are pulling enough support to seem plausible potential nominees. Obviously, others could break out. But for now that’s Biden, Warren, Sanders, Harris and Buttigieg. Of those, two are running clearly ideological and left progressive campaigns. They’re both supporting Medicare for All. Biden and Buttigieg are pursuing more conventionally liberal campaigns and they’re on the build on Obamacare model. Harris is the one who looks more like the latter two in policy terms and is clearly running a substantial different kind of campaign than Sanders and Warren. She’s clearly struggling to find a position on this issue with any good or clear footing. She’s bobbled back and forth on the private insurance question maybe half a dozen times at this point.

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