The Insanity of Medicare 2.0

US still struggling to find a proper health care solution

We’ve all heard this definition of insanity: doing the same thing over and over again but expecting a different result.

Here, in a nutshell, is the insanity of the current U.S. health care debate:

  1. Medicare, the government’s single-payer wealth redistribution health care program, is quickly going bankrupt.  No one disputes this fact.
  2. When President Obama refers to “cutting costs of healthcare,” he is referring to cutting the Medicare budget. Period.  No increased efficiencies, no improved services, no reduced market-clearing prices. No, cutting costs refers to reducing the fraction of the U.S. government’s tax collections devoted to Medicare.
  3. The new Health Care Plan is fundamentally a new Medicare program. Let’s call is Medicare 2.0.
  4. Medicare 2.0 is being funded in large part by cutting the current Medicare budget item. We are supposed to ignore the fact that the funds cut from the current Medicare program will be spent on Medicare 2.0.
  5. The Medicare 2.0 plan shifts as much as 25% of its (under)estimated costs (e.g. payments to physicians) to other accounts.  The costs are still there; these obligations would still need to be paid by the government under the proposed legislation, but Congress is hoping the public won’t “count” the shifted costs if they slap another name on them, further fostering the illusion of “lowering costs of health care.”
  6. Medicare 2.0 will also go bankrupt but, as a larger, more far-reaching entitlement program, the impact on the U.S. budget will be larger and more far-reaching.

By Sherry Jarrell

2 thoughts on “The Insanity of Medicare 2.0”

  1. Dear Sherry:

    I suggested, long ago, what I called “Medicare For All”, MFA (that was before I got kicked out of the Daily Kos for thinking too much).

    The idea was that MFA would be fully endowed with negotiating powers with providers (as done, say, in France). Anybody, and their family, could BUY into MFA before the age of 65 (for how much to be determined so that no unmanageable deficit would result). The point being that giant economies of scale would lower costs (as they have in other countries).

    I know this is not the lamentable plan considered today. My question to you, though: do you see anything wrong with this picture?

    Meanwhile I find ironical to pay direct out of pocket French drugs in France, for less than my US co-pay, for the same exact French drug, in the same exact same box, in the USA.

    How does this compute? A lot of direct marketing is forbidden by law in Europe, so drug companies have lots of money for research, even though that they sell their products for less; the French Assurance Maladie is the world’s largest single client they have, though, so providers are nice…

    PA

    Like

    Reply

  2. I don’t know the details of all the intricate parts of the delivery of medical services, products and drugs in France versus the US, so can’t speak to that. Your MFA ideas sounds an awful lot like competition, if in fact people may choose to buy health care insurance from private health care companies who will compete with each other in order to provide the best care for the lowest price while still earning a sufficient profit. If your plan strays from that ideal, and involves government as one active player in this dynamic between supply and demand, then I see lots wrong with “this picture.”

    Like

    Reply

Leave a comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.