Is single-payer a “job killer”? And does it matter?

Abstract: Some policymakers argue that moving to single payer health care will "kill jobs." But is that a reason to stick with the status quo?

A report from the Office of the Actuary at the Centers for Medicare and Medicaid Services (CMS) finds that health care spending continued to grow in 2018, to $3.6 trillion. Health care spending grew 4.6% in 2018, which is the same rate in 2016 but faster than in 2017. This spending growth was driven mostly by private health insurance and Medicare spending (which grew as a tax on health insurance was reinstated), while personal health care spending remained unchanged. 

The pattern of perpetual health care spending growth is concerning but unsurprising. We know that the cost of our health care system is unsustainable. Inefficiencies, waste, and price inflation grossly inflate the cost of care, making health care unaffordable for many Americans, and squeezing government spending on community conditions like education and income support. 

However, to those who want to maintain the status quo, the high cost and inefficiency of our health care system is being framed as a benefit. As New York Times columnist Farhad Manjoo recently wrote, some policymakers and politicians are wary of transforming the health care system because it would make millions of jobs at private insurance companies and other middlemen obsolete.

Manjoo finds this a bizarre and immoral argument for sticking with a broken system. “Even if it is the case that reforming American health care might eliminate some jobs, it would seem to be a good trade for the likely benefit: More people might gain access to affordable health care and get to keep living,” they write. 

The argument that moving to single payer health care will “kill jobs” is essentially the claim that health care has become “too big to fail.” Health care has become such a big part of our economy that we must let it continue to eat up more and more money. 

This is the problem with the many headed hydra of healthcare — at 20% of GDP of course it affects a lot of jobs when you reorganize it. But the alternative to reorganizing is to continue screwing the rest of the economy,” said Shannon Brownlee, senior vice president at the Lown Institute.

The language of “killing jobs” is also misleading; jobs will not “die,” but turn into different jobs. “All those claims processors in private insurance can go work for CMS, and all those construction workers building new pharma buildings can build wind turbines instead,” says Brownlee. “It’s not like the money goes away, it just moves to different industrial sectors.” If more people have access to health care, there will also be more jobs available for health care professionals. And people who gain access to health care will be healthier and able to work, which may boost the economy as well. 

As Manjoo writes, why are we worried about Medicare For All potentially killing jobs, when our current health care system is killing people?