> Medicaid and Medicare are heavily subsidized in practice by private insurance covered patients. If we implemented single-payer in the form of Medicare as it is now, the healthcare industry would quickly collapse.

In addition to everything you said (which is true), Medicare's apparent success is also boosted by the portion of Medicare patients who receive their non-pharmaceutical Medicare benefits through a private insurer.

Original Medicare (which is the part of Medicare that is purely government-run[0]) has dramatically lower ratings for both medical outcomes and patient satisfaction scores[1] than Medicare Advantage, which is privately run. Medicare Advantage also consistently outperforms Original Medicare on cost as well.

Unfortunately, when statistics are cited for Medicare as a whole by laypeople and in mass-media, Original Medicare and Medicare Advantage are lumped together, giving the impression that Original Medicare is much more effective and well-liked than it actually is.

The same applies to Medicaid, but because that's state-run, the exact details vary from state-to-state. Overall, though, nearly ever state has some form of private management for Medicaid plans, and those consistently outperform the state-run counterparts, for reasons which are immediately clear to anybody who's experienced both firsthand.

[0] except for drug benefits under Part D

[1] In 2015, Original Medicare's patient satisfaction scores were lower than the very worst Medicare Advantage provider - they were literally the bottom of the rung.

But this is because Medicare reimbursement rates are set by a panel of specialists (I believe there is one internal medicine doc and then every specialty is represented, so getting a stent sure does get reimbursed well while counseling a diabetic about keeping that A1c down or working on the toe of a homeless guy get reimbursed approximately not at all) who don't necessarily care if Medicare is that fair.

Tangentially, note Medicare spends about 3% on overhead, compared to private industry's previous 30%. (There are now caps on overhead expenditures -- trying to keep it to 20% or less.)

> But this is because Medicare reimbursement rates are set by a panel of specialists... who don't necessarily care if Medicare is that fair.

The problem is that Medicare has no incentive to ensure that their rates are sustainable (without the indirect subsidies that come from private insurers).

Medicare can balance their budget either by increasing their revenue (ie, asking Congress for more money) or by lowering their costs (ie, cutting reimbursements). They have no mandate to ensure that their reimbursements cover the marginal costs of care (and as a result, they don't). On top of that, private insurers are guaranteed by law to pay more than Medicare does, so they can set their reimbursement rates as low as they want.

This is also why the best providers almost never accept Medicare - or, if they do, they do it through a separate practice from their main one. Accepting Medicare means that you're likely going to run a loss on those patients (unless you're operating out of a CAH). So, the best doctors either segregate their Medicare patients into a separate practice (which allows them to manage their losses by capping the number of Medicare patients they see, but also dramatically reduces doctor availability from the patients' perspective), or they just drop Medicare altogether.

The US government spends more on health care than some other G7 nations, not including private insurance.

http://visual.ons.gov.uk/how-does-uk-healthcare-spending-com...

If you include both government spending and private insurance the US leads the G7 in spending on healthcare (but doesn't seem to get results that match the massive spending); if you only include government spending the US pays more than Canada, the UK, Italy, and the OECD average. It pays about the same as (a bit less than) France.

> If we implemented single-payer in the form of Medicare as it is now, the healthcare industry would quickly collapse.

This is because of the pisspoor state of US healthcare that insists on huge amounts of over testing, over diagnosis, and over treatment - causing excess harm at every step.

To amplify your last statement, I recently had a kid. It was a low-risk pregnancy and in the end a fast and boring birth -- could have had the kid in a clean barn with some qualified attendants, in the end. But to get this boring, normalish (breech) birth I had to spend some hours researching providers and my insurance options to work with someone who practices low-intervention, evidence-based medicine -- and I had to drive to another state to work with this guy. Everyone within 40 miles wanted to throw a lot of resources and a C-section at me -- for no mortality or morbidity benefit that persists after about 10 minutes. (Breech babies born the old-fashioned way generally have low 1-minute Apgar scores.) I saved my insurance company a ton of money, I have to say.

The whole experience of pregnancy was an experience of reading the medical literature and then trying to evade the "care" of obstetricians in the standard US care model. I'm glad we have the facilities to deal with all the complications that arise, but we don't have to use them just because they're there when they're not appropriate care.

I agree my comment was an oversimplification but I think it is fairer to say that "the health care industry as we know it would change"

I think you are unlikely to see immedaite adoption but over time you would have many other/new/different problems to address just as we have many problems now. It is worth mentioning that it would like cause significant employment reductions in the non-governmental insurance providers which are not without an impact.

But for starters, both medicare and medicaid are effectively a concentration of very high risk/high cost customer pools (the elderly and the low income). Opening it up would likely positively impact that cost calculation as well