Messing with Success: Leave Medicare Alone!

I’m listening to the news at the tail end of a beautiful Friday afternoon and I am so angry I could spit. I just heard about the new budget plan passed by the House which calls for requiring Americans 65 and older to use “vouchers” to purchase private health insurance in 10 years and works to dismantle one of the most successful healthcare programs in the world — Medicare.

Yes, you heard me right, Medicare. Because the reality is that Medicare does a pretty decent job of covering core health care needs of a large component of American society and, because of its size, is the only health insurance program in the country that can literally change how medicine is practiced through its policies.

Yes, there is fraud and waste. But we are also getting better at reducing it. But to turn millions of older Americans loose onto the commercial health insurance market and expect it to translate into cost savings is one of the most ludicrous, ridiculous things I’ve heard in my more than 25 years of writing about health care in this country. Here are just a few reasons why:

1. Medicare beneficiaries already have the ability to purchase private health insurance — through Medicare Advantage programs. And yet just one in four chose this option in 2010. The program also costs the federal government significantly more per beneficiary than traditional fee for service, approximately 9% more per enrollee.

2. One of the biggest problems with our health care system today is its fragmentation among payers with thousands of varying policies, regulations, and rules. But Medicare, because of its size, can change medical practice with a single policy change. When Medicare enacted DRG payments for inpatient hospitalization, essentially paying hospitals a fixed price based on the patient’s diagnosis, not the number of days patients remained hospitalized, hospital stays dropped significantly. Not just for Medicare patients, mind you, but for all patients.

3. Since when did health insurance companies become paragons of goodness? Seems to me just a year or two ago they were the devil incarnate, with their lifetime caps, preexisting conditions, claim denials, and retroactive canceling of policies when the bills came due.
per benefesearch from the Medicare Payment Advisory Commission (MedPAC) shows that the government pays PFFS plans 119 percent of the average cost per beneficiary in traditional Medicare.

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