Single-Payer System Would Likely Save Money

Largest savings predicted to come from simplified billing and lower drug costs

THURSDAY, Jan. 16, 2020 (HealthDay News) -- There is near consensus across 30 years of economic analysis of single-payer plans that a single-payer system would reduce health expenditures in the United States, according to a review published online Jan. 15 in PLOS Medicine.

Christopher Cai, from University of California, San Francisco, School of Medicine, and colleagues conducted a systematic literature review to identify formal economic studies of the projected costs of single-payer plans for the United States or for individual states. Additionally, cost changes were assessed by factor, including increased health care utilization, simplified payment administration, drug costs, or other factors.

The researchers identified 22 single-payer plans during the past 30 years. The majority of studies (19 studies; 86 percent) predicted net savings (median net result was a savings of 3.46 percent of total costs) in the first year of program operation, while 20 studies (91 percent) predicted savings over several years. For all plans, anticipated growth rates would result in long-term net savings. Simplified payment administration was the largest source of savings (median, 8.8 percent). The best predictors of net savings were the magnitude of utilization increase and savings on administration and drug costs (R² of 0.035, 0.43, and 0.62, respectively). In a multivariate analysis, only drug cost savings remained a significant predictor. Due to heterogeneity in study methods, a formal meta-analysis was not possible.

"Even though they start with different single designs and modeling assumptions, the vast majority of these studies all come to the same conclusion," a coauthor said in a statement. "This suggests that fears that a single-payer system would increase costs are likely misplaced."

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