Nancy Pelosi 2

History and Science Lessons for Pelosi and Obama

For supposedly progressive politicians, Rep. Nancy Pelosi (D-CA) and President Obama aren’t doing the best job of, well, progressing.  As both history and science march forward, they are stuck in the 1960’s.  Medicare was created in 1965, and since then, the average life expectancy of Americans has increased from 70.2 years to 79.5 years.

Things have changed.

We’re healthier for longer, which is why we are living for longer, but we can still start receiving Medicare benefits when we turn 65.  As a result, seniors collect benefits for almost three times as long as compared to when the program started.

So there’s your context.  Now listen to this gem from Nancy Pelosi:

Don’t you think … you ought to see if raising the age really does save money?  Those people are not going to evaporate from the face of the Earth for two years. They’re going to have medical needs, and they’re going to have to be attended to.

Yes, Nancy, we can agree on that!  Generally speaking, seniors don’t “evaporate” off the face of the earth.  It would be especially interesting if they developed the magical ability to do so “for two years” and then return. 

Here’s a suggestion: instead of relying on sensational, fantastical rhetoric like that, maybe you could take a look at the facts.  Until then, you’re prudential judgments – if you can even call them that – will remain unsubstantiated opinion that would be best kept to yourself.

And to answer your question, Mrs. Pelosi, yes, raising Medicare’s eligibility age would decrease costs.  But you clearly haven’t taken the time to read up on that, since it’s February of 2013 and you’re still asking the question that we’ve had an answer to for years.

If Congress were to adopt a plan like the one produced by the Heritage Foundation, which would raise the eligibility age to 68, it would yield an estimated $243.6 billion in savings over 10 years.

And by the way, raising the eligibility age is an idea that has broad bipartisan support.

If Nancy Pelosi can’t understand how having people on Medicare for shorter periods of time will decrease the overall cost of Medicare, she may also be unable to fully appreciate the impact of the following:  The Congressional Budget Office reaffirmed in a new report last week that by 2023, the debt will soar from $16 trillion to $26 trillion, and will grow “sharply” thereafter.

The CBO attributes this to a combination of the aging population and rising healthcare costs.  If she reads the Washington Examiner, they’ll help her put two and two together!  They explain:

Medicare is the program where these two factors converge. With more and more seniors demanding increasingly expensive medical care, the program has become unsustainable. 

Unfortunately, President Obama’s willful ignorance has been just as strong as Rep. Pelosi’s.  (Hence the path we’re on to a $26 trillion debt.)  The President has refused to produce a plan that puts Medicare on a sustainable trajectory.  The President and Rep. Pelosi are joined in their obstinacy by Sen. Ron Wyden (D-OR), who said that he has no plans to partner with Rep. Paul Ryan (R-WI) on a new Medicare reform bill.

This is an unfortunate change of heart.  In 2009, Sen. Wyden said:

Absent a bipartisan effort to fix Medicare and protect this guarantee—if nothing is done—what the years ahead ensure is that seniors and health care providers will be getting a steady diet of cost-shifting and arbitrary cuts until the Medicare guarantee is kaput.

The alternative to Medicare going kaput would be a patient-centered reform, which would entail premium support.  The government would make a defined contribution to the health plan of the beneficiary’s choice.  Yes, choice.  This per-capita contribution, a fixed dollar amount, is based on a process of competitive bidding among insurers to provide Medicare benefits.

Seniors could choose a more expensive plan if they want, or they could buy a cheaper one and pocket the savings.  And the competition would require insurers to compete for enrollees’ dollars, hence driving down costs.  Furthermore, premium support would decentralize financial decision-making through the personal preferences of enrollees.

Nancy Pelosi, President Obama, and Sen. Wyden are supposed to be public servants.  Yet, they do a huge disservice to the American people, seniors and young people alike, by helping to destroy our economy and allow Medicare to remain on an unsustainable path.  When they’ve completed the task of destroying the economy and Medicare, no amount of emotional, feel-good, we-heart-seniors rhetoric will cover up the $38 trillion (and growing) in unfunded promises to American seniors.

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Nancy Pelosi thinks that Medicare reforms will make seniors "evaporate."

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Medicare, as it exists currently, is adding massively to the debt and is unsustainable.

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