The U.S. health care market would shift with a single-payer national health insurance system. The basic economic theory behind single-payer is that it creates amonopsonyin the healthcare market, where the government is the single buyer. Potential monetary savings would come primarily from decreased administrative costs arising from a single firm providing health coverage, and the practice of buyer power to diminish input prices. The government will be free to pay whatever it wants for health care, without competition from private insurers (Diamond, 2009).

An advantage of universal coverage from a provider perspective is administrative savings (Diamond, 2009). Administrative costs are incurred by almost every provider in the form of filing claims, collecting cost-sharing, petitioning claims denials, and meeting prior authorization agreements that differ greatly between private and public insurers. These administrative functions would be greatly reduced with the elimination of private insurance companies. A disadvantage that providers would face with universal healthcare is that providers have less flexibility in negotiating prices (Blumberg and Holahan, 2019). As such, there would be reductions in hospital revenue and physician incomes as the government tries to control costs, prompting many providers to go out of business.

With universal coverage, all individuals would have the same health insurance and be able to receive health care services. Coverage would be continuous and not dependent on employment, family status, income, state of residence, or age change. On the flip side, consumers would experience rationing and long waiting periods for medical services (Diamond, 2009). For example, in Canada where there is a universal, publicly funded health system, the total wait time that patients face from referral by a GP to a specialist is 10.5 weeks, followed by another 12.1 weeks from the consultation time with a specialist to the point at which the patient receives treatment (Barua and Moir, 2020). That is over 5 months of waiting for treatment!

The U.S. economy would be affected both positively and negatively by the adoption of universal health coverage. Making health insurance universal would strengthen small business and voluntary self-employment; delinking the workforce from employment creates a wider range of economic options for workers (Bivens, 2020). However, expanding health care access to everyone will drive up overall costs and spending. More people will utilize services, further contributing to moral hazard. It is estimated that providing government funded health care to all could increase federal spending by $32.6 trillion over the first 10 years of implementation (Blahoous, 2018).

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