The primary tradeoff with asingle-payer system is cost, versus the social benefit of universalcoverage and a healthier population. (Photo: (iStock)

In a previous article in BenefitsPro, I outlined some of thebroader issues surrounding the increasing discussion of universal,single-payer health care for the United States,including Medicare for All (M4A). The primary tradeoff with such asystem is cost, versus the social benefit of universal coverage anda healthier population.

Related: Pay the medical bills or save forretirement?

The following are more specific components of single-payer thathave been tested and are likely to continue to be key items fordiscussion:

State versus federal program: A number ofstates have proposed government sponsored single-payer systems,including Michigan, New York and California. The biggest impedimentto implementation is cost, whether through payroll and/or businesstaxes. Tax increases would be required in states requiring abalanced budget. As with any differential in tax rates, there isthe possibility that firms could relocate to lower-taxjurisdictions.

ACA and federal support: Currently, anytransition toward universal coverage would require federal supportthrough the Affordable Care Act (ACA) and Medicaid expansion. Howdo we get from here to there? Undoubtedly, a transition would takeyears. A congressional proposal draft, which assumes continuationof the ACA in its current form, would pool Medicare and state taxfunds to provide universal coverage.

Worker displacement: Under M4A/single-payer, wewould expect a diminished role for insurance companies and areduction in people employed in the insurance industry,particularly those involved in administration and benefitsprocessing. On the other hand, there is likely to be increaseddemand in the government sector for skilled labor to administerM4A. While in some scenarios, physician income under M4A may benegatively impacted by lower reimbursement rates, other workers maybenefit, such as home health care professionals. Investment inworker retraining will be required.

A compelling statistic is that the United States, Greece, andPoland are the only countries of the 34 members of the Organizationfor Economic Co-operation and Development (OECD) that do not haveuniversal health care. Whether the UnitedStates eventually joins the list will be an open question goingforward. Stay tuned.

NOTE: Information presented herein on the healthcare sectoris for discussion and illustrative purposes only and is not arecommendation or an offer or solicitation to buy or sell anysecurities. Fred Slade has over 25 years ofexperience in the investment management and retirement servicesindustries. He is Senior Director, Investments for PentegraRetirement Services, a leading provider of retirement services tofinancial institutions and organizations nationwide, founded by theFederal Home Loan Bank System in 1943. Mr. Slade manages over $1billion in internal bond portfolios and provides analytics andstrategy for Pentegra's Defined Benefit and Defined ContributionPlans. Mr. Slade holds a Ph.D. in Economics from University ofPennsylvania and a CFA, and has presented at a number of seminarsand conferences.

READ MORE at BenefitsPRO:

• Pay the medical bills or save forretirement?
• Health care costs crimping retirementsaving
• How reducing health care costs can boost retirementsaving