I'd endorse Kevin's suggestion for using Medicare as a model for what universal health care will and will not do, but it's worth being a bit careful here. We often say that Medicare's current performance is not, in fact, a good guide to how a reformed system would perform. Medicare is a creature of the system that's currently in operation, and has not been charged, and has shown no interest in using its weight and market share to push towards reform. A Medicare single-payer plan with price controls could operate very differently. And since one of our big arguments for reform is the need for cost control, we can't assume Medicare will operate as it currently does -- spending almost whatever is asked on whatever treatment is recommended.
But nor are price controls being contemplated. A lot of the current thinking has to do with funneling research dollars towards studies that will demonstrate the cost-effectiveness of various therapies and the comparative effectiveness of similar treatments. Additionally, changing how we treat chronic diseases -- which is to say, moving from an acute care model to coordinated, maintenance oriented model -- offers an enormous amount of hope, as 70 percent of our spending is on chronic conditions. Add in electronic records, a reduction in incentives for physicians to overprescribe treatments, administrative savings, and all the rest, and you have some real hope for cost savings that have nothing to do with price controls, or indeed any policies that would impede useful innovations. There will, presumably, be fewer incentives for the development of me-too drugs, and the prescription of unproven therapies, but those are good things.
Which gets to the final point: With the possible savings, you could plow more money into the National Institute of Health, put more funds behind the FDA (thus speeding up the drug review process), establish prize funds for pharmaceutical development, and do much more that would actually accelerate innovation. We can construct a universal health care program in any way we want and if we'd like to retain something near current levels of spending in order to increase the likelihood of medical breakthroughs, we can do that too.
