Under a single-payer system such as Medicare, all medical providers bill the same purchaser — namely, the government, which sets rules about what it will pay for. The putative benefit of this arrangement, as Ezra Klein explains over at Vox, is that the government can use its monopoly on demand to pay medical providers below-market rates.Not "below-market:" the marginal factor cost exceeds the offer price (economists call that monopsony.) As columnist Jason Richwine notes, depressing the offer price induces suppliers to provide less.
Take public education. There is essentially a “single payer” for education within school districts. The teachers, principals, custodians, textbooks, and school buildings are all paid for by the government. Yet Bernie Sanders would never argue that the government should use its near-monopoly to push teacher salaries below market levels. In fact, raising teacher pay to be on par with the salaries of other college graduates is a perennial goal of progressives.On the other hand, perhaps state and local governments are already acting like monopsonists with respect to government schools and state-tolerated universities.
To see the inconsistency another way, imagine Republicans trying to portray a cut in education spending as merely “savings” generated by “limiting reimbursements to education providers.” Sanders would have an arm-waving fit, warning that education quality would suffer. Somehow he has no similar concern when doctors are the ones being squeezed. So here is a question for a reporter to ask: “Senator Sanders, given the benefits of single-payer systems you’ve described, shouldn’t you want to underpay not only doctors, but teachers as well?”I wonder if there isn't a way for the right kind of university president to call out a stingy legislature for behaving like Walmart or like the canonical coal company.