Ryan/Wyden health care: controversy over ending Medicare distracts from real issues
The Kansas City Star
Tiresome. That’s about the best that can be said for the debate about whether Congressman Ryan’s plan terminates, privatizes, alters, saves or ends Medicare, at least as we know it. With all due respect to Politifact and the debate it started, these labels seem more like opinions than verifiable fact.
The discussion could be a bit more specific. Congressman Ryan and Oregon’s Senator Ron Wyden (Democrat) have now proposed a plan that would allow senior citizens a choice between traditional Medicare and a voucher that could be used to buy private insurance. The plan would limit the government’s responsibility for increases in costs, shifting additional costs to the insured.
Though the plan may provide assistance to people with limited incomes, it remains unclear (to me at least) what the government would do if people elected not to use their vouchers or subsidies to buy insurance. As the gap between the subsidy and the cost of Medicare or private insurance increases, many poor seniors could decide they would rather eat than pay the premium. And when they get sick, they’ll go to the hospital and plead for treatment. Pretty much like poor people do now.
So to avoid that problem, will the government “mandate” that all seniors buy one kind of insurance or another? Isn’t that the objection to the Affordable Health Care Act’s mandate?
Further, what if senior citizens say they would rather have cash for their voucher and want to use the money to pay doctors directly? After all, it’s their money, and isn’t the argument that people should be able to spend their money however they choose? Why would Paul Ryan be opposed to giving people choices?
I read as much as I can tolerate when these proposals get floated around. But I won’t claim that I’ve read everything, and somewhere there may be an answer to a question I ask myself. I’m a 61 year old male with “preexisting conditions.” But I’ve never had a year in which my insurance company paid medical expenses that exceeded my premium. My monthly insurance costs over $900. Would someone tell me what the premium for an 80 year old man would be in today’s market if Medicare were privatized? And tell me how much money the government voucher would be for that 80 year old man?
The faith that competition among insurance companies will substantially drive down costs is misplaced. Competition among health insurance companies wouldn’t drive down the cost of health care any more than the competition among car insurance companies reduces the sticker price on that new Toyota or repair prices after an accident.
At least not much. Car insurance companies try to save money on repairs by requiring installation of after-market parts. But do you really want a cheap pacemaker installed in your own heart?
Managed care in the insurance industry has tried to save money by reducing doctors’ fees and limiting access to services based on a bureaucrat’s determination of medical necessity. However, what money has been saved has largely been squandered on more insurance company bureaucracy. Insurance costs continue to rise.
From my perspective, the Ryan/Wyden proposal is earnest, but shifting the increasing cost of medical insurance to seniors won’t work without real cost containment. It’s possible that better prevention may save costs. Maybe fraud enforcement would help a bit.
But a major factor in Medicare costs is end of life care. Estimates vary, but some estimates show that 25% or more of Medicare costs are incurred in the last year of a person’s life, much of this on extensive but improbable efforts to extend life.
Should the government set limits on what care can be given to an elderly person? Death panels, anyone? In a word, no. But we could allow seniors to purchase the level of coverage they wish. When I’m 90 years old, I think I’d forgo a $4,000 per month policy that would give me unlimited funds for a heart transplant. Maybe I’d opt for an affordable plan that provided good hospice care.
Or maybe not. In the meantime, there seems to be very little in any plan (including the Affordable Health Care Act) that truly addresses the problem of rising medical costs.