Medicare for All Act Proposes Universal Coverage with Zero Co-Pays, Sunsets Private Insurance and ACA Exchanges

The “Medicare for All Act” is proposing a total overhaul of the U.S. healthcare system, establishing a single, comprehensive national health insurance program that covers every U.S. resident. The core promise is simple: universal coverage with zero out-of-pocket costs—meaning no deductibles, co-pays, or coinsurance for any covered, medically necessary service. This isn’t just about covering hospital visits; the benefits package is massive, including dental, vision, hearing, mental health, substance use treatment, reproductive care (including abortion and fertility treatments), and comprehensive long-term care (SEC. 201, SEC. 202). The transition is phased, with full benefits kicking in two years after the bill is enacted, but people under 19 and those 55 and older get early access after just one year (SEC. 106). This bill is essentially trying to eliminate the financial stress of getting sick by making healthcare a public utility.

The End of Duplicate Private Coverage

If this passes, your current health insurance landscape is gone. The bill explicitly bans private health insurance companies from selling policies that duplicate the benefits provided by the new Medicare for All program (SEC. 107). This means the vast majority of employer-sponsored and individual plans would essentially disappear, replaced by the national program. Crucially, the ACA Health Insurance Exchanges (Marketplaces) would also be shut down two years after enactment, along with the federal subsidies that make them work (SEC. 902). If you’re currently buying a plan on the Exchange, or if your employer provides comprehensive coverage, you’d be transitioning entirely to the new government-run system. While you could still buy supplemental insurance for services not covered by the Act, the core coverage decision is removed from the private market entirely.

How Doctors and Hospitals Get Paid Now

This is where things get radical. The bill fundamentally changes how providers are paid, moving away from the current chaotic mix of insurance payments. Hospitals and other institutional providers will be paid through a global budget—a fixed, lump sum payment negotiated annually with a regional director to cover all operating expenses for the year (SEC. 611). Think of it like a salary for the hospital. For individual doctors and practitioners, payment will shift to a national fee-for-service schedule set by the Secretary of Health and Human Services (HHS) (SEC. 612). A major concern here is that the bill explicitly terminates all existing federal pay-for-performance and value-based purchasing programs, like MIPS (SEC. 903). While the bill mandates new quality standards (SEC. 501), it bans using quality metrics when setting the payment rates (SEC. 614), relying instead on separate review boards. For providers, this means more predictable funding (for institutions) but the removal of financial incentives tied to patient outcomes.

Getting Control Over Drug Prices

One of the biggest cost-control measures involves prescription drugs. The Secretary of HHS is required to negotiate drug prices annually with manufacturers (SEC. 617). If those negotiations fail, the Secretary gains the unprecedented power to authorize competitive licensing, essentially allowing another company to manufacture the drug for the program using the original manufacturer’s patent or clinical data. This is a massive hammer to hold over pharmaceutical companies and could drastically lower drug costs, but it sets up a guaranteed legal fight over intellectual property rights and compensation.

Who’s Running the Show, and How It’s Funded

The Secretary of HHS is granted massive regulatory authority to implement the entire program, from defining eligibility to setting quality standards and managing the National Health Budget (SEC. 401, SEC. 601). This centralization of power is significant; the Secretary essentially becomes the CEO of the entire U.S. healthcare system. To address systemic inequality, the bill creates a dedicated Office of Health Equity tasked with collecting detailed data on health disparities across numerous demographic factors—including race, disability, and socioeconomic status—and making that data public (SEC. 615).

Funding for this system will come from a new Universal Medicare Trust Fund (SEC. 701). This fund is financed by absorbing existing federal health spending (Medicare, Medicaid, TRICARE purchased care) and, crucially, 100% of the net revenue generated by new tax changes (SEC. 701). While the bill text doesn't detail the tax hikes, the reliance on capturing "net increase in Treasury revenue" signals a necessary and substantial increase in taxation to cover the costs of universal, comprehensive care.