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Feb
19

Single Payer’s impact on jobs

Reality is, switching to a government-run and administered healthcare system would crush the economy – because millions would lose their jobs.

There are 22 million jobs in the US healthcare and related industries (that includes mine, one of our daughters, and her husband – they are nurses – our other daughter is in the tech business and one of her clients is a large health system; our son is also in tech and his company services medical practices.)

The private health insurance industry alone employs north of a million people. (data on this is spotty; UnitedHealthcare has 300,000, Cigna, Molina, Centene, Aetna and Anthem combined have over 180,000; there are dozens of other healthplans, PBMs, TPAs, and ancillary service providers.

On the provider side, there are over 700,000 management jobs (average salary is $86,000) and several million administrative jobs.

Many large hospitals and healthcare systems need several hundred workers just to handle billing and collections; these jobs would go away under a single payer system.

Let’s add all the college and grad school institutions that employ tens of thousands to educate people on healthcare administration, and the support infrastructure – IT companies, paper form printers, App developers, pundits and commentators, real estate occupied by insurers…you get the idea. The health care industry is at least a fifth of our economy.

If we switched to a true single payer system, millions of administrative, support, and related jobs would disappear. Remember what happened to manufacturing in the rust belt? That happened over 50 years; this would affect a much bigger share of the economy over a much shorter time.

The result would be an economic collapse that would surpass the Great Depression and devastate the economy.

Lest you think this is hyperbole, Taiwan employs a grand total of 300 people to administer a single payer healthcare system for a population of 24 million.

Using Taiwan as a basis, we’d only need 4,125 people to administer a universal single payer system.

All of the people administering Taiwan’s health system work in this one building.

What does this mean for you?

Believing government administered Single Payer can happen anytime soon requires magical thinking.


One thought on “Single Payer’s impact on jobs”

  1. Thanks for the recent excellent posts. Let me add just one item here:
    Thanks for your recent excellent posts. Let me add just one item here: Medicare would have to hire many thousands of specialists to process its flood of new claims under single payer. Medicare is not all that simple to administer in doctor’s offices either. Medicare unfortunately has thousands of fee categories, and a provider can raise their income through steady upcoding.

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Joe Paduda is the principal of Health Strategy Associates

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