True or False: John Delaney Says Medicare for All Would Shutter Hospitals

John Delaney debating Medicare for All and closing hospitals

Presidential candidate John Delaney made waves in last week’s first round of Democratic debates during the healthcare discussion. While most candidates are on board with some type of Medicare reform, Delaney, a former healthcare financier, railed against Medicare for All, boldly claiming it would shutter “every hospital in this country.” But is this claim true? Healthcare policy experts say no. 

Delaney’s debate performance

In the debate, former Representative John Delaney (MD) said, “If you go to every hospital in this country and you ask them one question, which is, ‘How would it have been for you last year if every one of your bills were paid at the Medicare rate?’ Every single hospital administrator said they would close.”

Delaney’s claim operates under three main tenets:

  1. Medicare pays 87 cents for every dollar of costs
  2. A federal report indicated two-thirds of hospitals are losing money on Medicare inpatient services
  3. Delaney and his team have visited and questioned primarily rural hospitals

Delaney backed this claim so fiercely that his team passed out flyers to reporters after the debate describing some pitfalls of Medicare for All. 

False claims

Kaiser Health News, an editorially independent subsidiary of the non-profit Kaiser Family Foundation, partnered with PolitiFact to fact check Delaney’s claims. According to these healthcare and policy experts, Delaney’s claim is unequivocally false for several reasons. 

  1. Uninsured patients. Hospitals that treat a larger number of uninsured patients would see a rise in revenue under Medicare for All and would no longer have to worry about providing care with no compensation. 
  2. Medicaid. Patients previously covered under Medicaid would create more revenue for the hospital as Medicaid only pays 80 cents for every dollar of healthcare costs. As Medicaid is the largest healthcare provider in the United States, this could be quite a boost. 
  3. Adjusted payment rates. The Medicare for All bill does not dictate that a single-payer system would continue to pay at current Medicare rates. The government would be responsible for setting payment rates to hospitals and providers, and rates are expected to rise if the government becomes the sole healthcare payer. 

Underlying truth

One point of truth to Delaney’s claim is that hospitals that care for a larger number of privately insured patients will likely see a drop in revenue. However, this likely wouldn’t be enough of a dip for them to close their doors, according to Robert Berenson, health policy analyst at the Urban Institute. 

The second round of Democratic debates will be held in Detroit, Michigan on July 30-31. 

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