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Single-payer system benefits patients, physicians

U.S. physician organizations are shifting positions toward a single-payer healthcare system to benefit both doctors and patients. The single-payer system is a streamlined financing mechanism where one entity administers funding and payments.

After robust protests from medical students in 2019, the American Medical Association left the Partnership for America’s Healthcare Future, a lobbying group that spent more than 100 million dollars annually opposing both public option and universal single-payer proposals in federal election campaigns.

In 2020, the American College of Physicians and the Society of General Internal Medicine went a step further, endorsing both public option and single-payer reforms.

Yet, many physicians still worry that reform might decrease their income. Even though highly paid, their concerns are understandable given the burden of student debt, the length of medical training and Medicare’s lower fees relative to private insurers.

The nonpartisan Congressional Budget Office recently estimated payments to physicians under current policies and USP. CBO expects that under a USP system, the number of people accessing care would increase, resulting in 5% to 9% higher revenues. Some researchers project even larger savings to physicians’ pay because of the CBO's underestimate of savings from administrative simplification and streamlined billing. It’s estimated that 5% of a physician's current work hours are spent on billing. Less time spent on billing would free them to see more patients.

U.S. hospitals and physicians currently waste time and money contending with multiple payers, each with its own complex and varying coverage rules, payment procedures and formularies. The CBO projects what hospitals spend on administration would fall from 19% to 12% under single-payer; physicians’ administrative overhead would decrease from 15% to 9%; and administrative expenses of other medical providers (for example, dentists, home-health agencies and hospice) would drop from 9% to 6%. In addition, it estimates that physicians and nurses would spend less time on administrative activities, freeing up 4.8% of physicians’ work hours and 18.4% of nurses’ work time. These assumptions are based on research comparing high administrative overhead among U.S. healthcare providers relative to other nations.

When Canada transitioned to single-payer in the 1970s, physician income increased and they remained the highest paid professionals in the nation. Physician incomes in Canada have grown faster than incomes of other workers.

Although primary care physicians may see the largest boost under single-payer, specialists would continue to be high earners. It’s also estimated that malpractice insurance costs would likely decrease, as they did in Canada, since patients won’t need to sue to cover future medical costs.

As patients with unmet medical needs such as hypertension, diabetes and other chronic conditions could afford care, there would be greater utilization and doctors could shift their efforts to address the greatest needs without fear of losing income. To prevent long waitlists for appointments, an increase in residency training programs may be necessary to increase the number of physicians.

The bottom line of the CBO analysis is that universal coverage using a single-payer system can be affordably achieved even as benefits are expanded and cost-sharing all but eliminated.

The two-fold positive conclusion is that the CBO’s estimate and numerous research papers suggest physician compensation would prosper under single-payer reform while also being enormously beneficial to patients.

Jan Phillips of Durango is a retired small-business owner. After 40 years as a health educator, she advocates for health care reform.