The benefits of, and need for, a universal single payer healthcare system in the United States has been discussed previously (WestView, June 2013). Yet, what isn’t clear is how this can be achieved over the objections of the health insurance industry and their political supporters. There is one possible way that the health insurance firms, which oppose a single payer or “Improved Medicare” universal system, can be converted to supporters. Bribe them. More specifically, offer to buy them out.
Friendly takeovers and buyouts are common in the private sector. Corporations buyout corporations, and hospitals buyout other hospitals, along with doctors’ practices and other providers. This is not a bailout like those financial industry at the end of 2008 and beginning of 2009. Instead, firms would close up shop, turn over all their assets, including contracts, to the Federal single payer system and then go away to count their money. There is nothing radical about this proposal other then the fact that the government would be doing it instead of a private firm. The principle is well established; it’s just a matter of haggling over the price.
An internet search shows that the 12 largest private insurers, as of 2009, have a total stock value, or market capitalization, of under $200 billion. Given the value of smaller firms and stock fluctuation, a rough estimate of this value may go as high as $300 billion today. Most corporate buyouts can range from 25% to 100% of market capitalization, depending on the strength and future prospects for the target firms. Using these, admittedly crude, estimates, an overall offer of $500 billion for the industry as a whole would result in as much as a 67% up front bonanza for the corporations being bought out. If the estimates are too high, the costs would be lower.
This may appear like a great deal of money, but the cost of health care in the United States is approaching $3 trillion. A mere 5% savings in administrative costs would cover the costs of this proposal in a few years, while providing universal health insurance indefinitely, or at least until conservatives make their first attempts to re-privatize it. Furthermore, this buyout has to be extravagant since it will require the insurance companies to change their opposition to not only acquiescence, but active lobbying for a single payer system. The myriad lobbyists they have in Washington will have to do a U-turn and demand that their elected representatives, who might be interested in campaign contributions in the future, actively work to secure this financial windfall and universal health care.
The fight for universal health care has been going on in the United States for generations. We have a system which is uniquely expensive, bureaucracy-ridden, low quality, and maddeningly frustrating, or lethal, for patients and families caught up in its weaknesses. Instead of attempting complicated reforms of a terrible system, this proposal would decrease or eliminate all of these problems. It would be a bargain at a cost of a half trillion dollars.
