Dear Mediscare, Keep Calm and Think Conservative
Conservatives’ Medicare premium support proposal has been the subject of increasingly ridiculous attacks of late. Many essentially rest on the idea that none of us would be able to make decisions about providing and receiving health care without the guiding hand of the government. Of course doctors and patients navigate this system every day, including a Medicare system that’s broken into three parts, financed in two different ways, and leads most to purchase additional private catastrophic coverage. I’m not sure anyone would buy car insurance if it was structured like this, but the government do-gooders seem to think this is way to go.
Now, the aforementioned do-gooders are so concerned about what will happen to everyone in the free market that they think we may have a major medical catastrophe as a result. “God help anyone in their 70s, 80s or 90s who has to deal with private insurers. Will Ryan take responsibility for the strokes and cardiac arrests that ensue?” says Sylvia Lang on Redding.com. Apparently, premium support would throw us all to the “profit-lusting wolves” (read: insurance companies). I guess she had to throw the wolves under the bus here since this same crowd has endlessly explained how corporations aren’t people, so it would be unclear how exactly they could lust after anything.
Aside from the fact that seniors already spend a tremendous amount of money on wrap around insurance policies to cover the costs of catastrophic care as I mentioned before, this attack is nothing but unfounded sensationalism. Bob Moffit debunks this in this National Review piece saying:
“Well, millions of seniors must be recovering from the strokes and heart attacks caused by the life-threatening stress of enrolling in the plans they like. In fact, 90 percent of Medicare patients — including those in their 70s, 80s, and 90s — already are enrolled in a variety of private plans for their drug coverage. There are over 1,100 drug plans offered in 34 regions around the country. Even more shocking, roughly 27 percent of all seniors are enrolled in integrated private plans through Medicare Advantage.”
Not only do seniors successfully navigate these private plans, they’re also saving money in the process. The government do-gooders we’ve been talking about think the only way to have affordable coverage is through government price controls. Harvard professor and Obama advisor David Cutler argues that, “Seniors will face higher costs not only because of this cost shift from the government but also because the Romney-Ryan plan increases system-wide costs by promoting private insurance that will be more costly than the existing Medicare system.”
You don’t have to take my word that this analysis is misguided. For the rebuttal we can turn to… David Cutler. In the Journal of the American Medical Association, from the same month as his above comment Cutler says, “Nationally, in 2009, the benchmark plan under the Ryan-Wyden framework (ie, the second-lowest plan) bid an average of 9% below traditional Medicare costs (traditional Medicare was equivalent to approximately the tenth-lowest bid).” If a premium support system is paying out contributions “9% below traditional Medicare costs” it would seem to beg the question how this new system would be more costly. In fact, a similar system already exists for the Medicare Part D prescription drug benefit. This chart from Heritage shows how the costs of this system of defined contributions to private plans have come in below expectations. $48.4 billion is not something you find on the street.
So, while all of our liberal friends are reaching for the smelling salts over the idea that the government administered health care labyrinth known as Medicare is perhaps not the ideal, take a closer look at what they’re actually selling. The current system has so many problems that even some of its biggest proponents are having a little trouble staying on one side of the issue. At the end of the day Medicare premium support moves us closer to a patient centered health care system where you make treatment decisions with your doctor and insurance plans compete for your business with quality plans at the lowest possible cost.