As if the American healthcare system isn’t bad enough as it is, Republicans in the House of Representatives recently passed a budget plan that would return us to the days when most seniors were mired in poverty. The plan would put an end to Medicare for future retirees by phasing out the current program and replacing it with one where the government would provide subsidies to seniors to buy health insurance in the private market. In addition, the plan practically eviscerates Medicaid, the healthcare safety net for the poor. Joe Baker, president of the Medicare Rights Center, and Elisabeth Benjamin of the Community Service Society of New York, explain the plan’s potential consequences on Democracy Now! with Amy Goodman:
Privatizing Medicare and gutting Medicaid will hurl our country backwards, economically and socially. Giving out vouchers for what should be an essential public service never works because the value of the voucher would never cover the entire cost. Seniors would end up paying much of their income on health care. And what insurance company would cover anyone over 65?
Fortunately for the majority of us who don’t want to see our country resemble 19th century America, the House GOP plan is going over like a lead balloon. It’s likely this stinker isn’t going anywhere in the Senate. But instead of getting rid of popular programs that give millions of Americans access to health care, we should be expanding Medicare to everyone. As former Clinton administration labor secretary Robert Reich says, Medicare is not the problem, it’s the solution:
Medicare’s administrative costs are in the range of 3 percent. That’s well below the 5 to 10 percent costs borne by large companies that self-insure. It’s even further below the administrative costs of companies in the small-group market (amounting to 25 to 27 percent of premiums). And it’s way, way lower than the administrative costs of individual insurance (40 percent). It’s even far below the 11 percent costs of private plans under Medicare Advantage, the current private-insurance option under Medicare.
In addition, allow Medicare – and its poor cousin Medicaid – to use their huge bargaining leverage to negotiate lower rates with hospitals, doctors, and pharmaceutical companies. This would help move health care from a fee-for-the-most-costly-service system into one designed to get the highest-quality outcomes most cheaply.