Medicare for All vs. Public Option: How Do They Compare?

Medicare for All is a government-funded national health insurance program that would provide comprehensive medical coverage to all Americans. The proposal for Medicare for All is based on expanding Medicare, the current health insurance program that covers individuals 65 years of age and older and those with specific disabilities.

Medicare currently consists of:

• Medicare Part A: Part A covers hospital care, home healthcare, skilled nursing facility care, and hospice care.
• Medicare Part B: Part B covers services related to preventive care, diagnostic testing, and treatment of health conditions.
• Medicare Part C: Part C covers Medicare Parts A and B and offers additional coverage, such as prescription drugs, dental, vision, and hearing.
• Medicare Part D: Part D helps cover the cost of your prescription drugs and certain vaccines not covered under Part B.
• Medigap: Medigap helps cover the costs of your Medicare premiums, copayments, coinsurance, and other costs.

The expansion of Medicare to Medicare for All would include the essential parts listed above: Medicare parts A and B and prescription drug coverage. It would also be expanded to offer additional coverage not currently included in Medicare, such as:

• reproductive care
• maternity care
• newborn care
• pediatric care
• long-term care

With Medicare for All, how we pay for healthcare in the United States would be different from the current system. There would be no up-front cost or cost-sharing when you need medical services. Instead, the entire system would be tax-financed or paid for through taxes.

When eliminating cost-sharing, the single-payer system would eliminate private insurance plans such as Medicare parts C and D and Medigap. However, the out-of-pocket costs associated with those types of plans would also be gone, including:

• deductibles
• premiums
• coinsurance
• copayments

Medicare for All would also aim to eliminate high prescription drug costs and expand currently available drug options.

A Public option is a government-funded or state-funded health insurance program available on the health insurance marketplace as an alternative to a private plan. Unlike Medicare for All, enrolling in the Public Option would be entirely optional.

The Public Option would offer essential health benefits, which include:

• inpatient and outpatient hospital care
• mental health and substance misuse care
• newborn and pediatric care
• prenatal and maternity care
• prescription drugs
• preventive, diagnostic, and treatment care
• rehabilitation care

With a Public Option, you can choose to forego private insurance in favor of the government-funded or state-funded option. However, you would not be required to enroll in the Public Option if you preferred a private plan. The Public Option could be tax-financed, like Medicare for All, or paid for by participants with a traditional pricing structure.

While Medicare for All would overhaul the current Medicare structure, the Public Option might affect Medicare differently. For example, Public Option changes to Medicare could include:

• lowering the eligibility age for Medicare enrollment (Medicare at 50)
• expanding the eligibility requirements to include low-income individuals
• changing the Medicare offerings on the health insurance marketplace
• offering Medicare as a fallback option if other plans are too expensive

Public Option healthcare aims to create a more affordable health insurance option for individuals who cannot afford to purchase private insurance. It would also offer coverage to people who do not usually qualify for private plans, such as individuals with pre-existing health conditions.

So, how does Medicare for All compare to a Public Option? Let’s discuss some of the similarities and differences between the two options.

Similarities

The goals of Medicare for All and Public Option are to provide individuals with a low cost, affordable health insurance option. Both health insurance systems would be non-profit, aiming to lower beneficiary, administrative, and prescription drug costs.

Each option would include individuals who may otherwise not be able to receive health insurance through private entities. Both insurance options cover individuals with low incomes and pre-existing health conditions.

Differences

Under Medicare for All, only one health insurance option would be available. Everyone would be eligible and covered for essential health benefits. There would be no private insurance options and no marketplace competition. The goal would be to lower healthcare costs for individuals who would no longer pay up-front service fees. This option would be entirely tax-funded and government-run.

A Public Option would be an opt-in health insurance option for individuals rather than a mandatory option for all Americans. Private health insurance options would still exist, but the Public Option would compete to bring overall health insurance costs down. The Public Option could be funded through taxes, like a single-payer tax-funded system, or through the cost of individual enrollment.

Given the similarities and differences between the two health insurance proposals, you may wonder how each option will affect your medical and financial situation. Below is a comparison chart of the primary coverage and costs for Medicare for All and Public Option.

Medicare for All coverage vs. Public Option coverage

The biggest difference between the two proposals is the enrollment option: Medicare for All is a mandatory single-payer healthcare system that covers all Americans, while Public Option offers an optional healthcare plan to all Americans who qualify and want to opt in.

Discussions about health insurance are at the forefront of the current political and social climate. Regardless of the political spectrum Americans fall on, many individuals still want more affordable health insurance options.

However, that doesn’t necessarily mean everyone favors a single-payer healthcare system like Medicare for All. There also hasn’t been much talk about a Public Option, which could provide an intermediate between the two sides of the debate.

It’s hard to say exactly how proposals like Medicare for All and Public Option fit into the future of American healthcare, but these ideas will continue to evolve as we approach the 2024 presidential election and beyond.