Medicare Is No Model for Health Reform (Excellent Read!)

Wall Street Journal ^ | 09/11/09 | GRACE-MARIE TURNER AND JOSEPH R. ANTOS

[MissesBush]

Democratic leaders at both ends of Pennsylvania Avenue continue to battle over whether a new government-run health plan, modeled after the popular Medicare program for seniors, must be included in health-reform legislation.

President Barack Obama told a New Hampshire town-hall meeting last month that "if we're able to get something right like Medicare, then there should be a little more confidence that maybe the government can have a role." Did the government really get Medicare right? Here are the top 10 reasons this program should not be a model for reform, and why it would be dangerous for the federal government to be put in charge of any more of our health sector:

1) Medicare is going bankrupt. The Medicare Trustees estimate that the program will run short of money starting in 2017. Medicare will drown in a sea of red ink, with spending over the next 75 years outpacing dedicated revenues by nearly $38 trillion.

2) Private payers are bailing out Medicare. According to Milliman, an independent actuarial firm, Medicare—and to an even greater extent, Medicaid—underpays doctors and hospitals, shifting costs to private insurers. Milliman estimates that the average family in a private PPO health plan pays an additional $1,788 a year to compensate for underpayments by Medicare and Medicaid, representing a "hidden tax" on commercial payers totaling $89 billion a year.

Providers could not keep their doors open without the higher payments from private insurers. A recent letter to Congress from 13 leading health-care delivery organizations, including the Mayo Clinic, said "many providers suffer great financial losses associated with treating Medicare patients." They said that if these rates were expanded to patients who currently have private insurance, the result "will be unsustainable for even the nation's most efficient, high quality providers, eventually driving them out of the market."

[KarlInOhio]

5) Medicare is rife with fraud. According to the FBI, between 3% and 10% of all health spending is lost to health-care fraud. Despite the president's promise this money could be recaptured to pay for his reform agenda, Congress has shown itself to be remarkably incapable of curtailing fraud and abuse in government health programs.

Obama claims that cutting waste in Medicare will pay for part of Obamacare. I see them as separate issues and that the waste, fraud and abuse should be cut from Medicare no matter what happens with Obamacare. Obama seems to be holding it "hostage" so if Obamacare isn't passed he will allow Medicare waste to continue.

[Sicon]

"if we're able to get something right like Medicare, then there should be a little more confidence that maybe the government can have a role."

And they say W is stupid and/or a liar...

What a buffoon.

[DannyTN]

I disagree with #6 & #9, and suspect #5 is overstated.

It's not appropriate to say the program doesn't work because benefits are limited. If it prevented supplemental insurance then a case could be made, but it does not.

I seriously doubt 3-10% of health care spending is fraud, and I think it is self serving for the FBI to say that it is. Most hospitals, doctors and providers are legitimate. Those few that are fraudulent may rake in the money before they are caught, but they are caught.

[Mrs. Don-o]

OK, the article uses the FBI as its source, and they are presumably professional investigators. You make two counter-claims: (1) fraud isn't that high (you'd say less than 3-10%?) and (2) fraudsters are usually caught.

That sounds good. I'd love to see evidence for that.

Got a source?

[mulligan]

NO GOVERNMENT RUN AND MANAGED PROGRAM IS A MODEL FOR ANYTHING.

[kenavi]

I seriously doubt 3-10% of health care spending is fraud...Most hospitals, doctors and providers are legitimate.

I agree with you.

My understanding is that anyone submitting even an unintended false claim, such as double-billing, faces a strong possibility that the government will end up putting him out of business or sending him to jail. So it's not for lack of punishment that there still occurs some waste or outright fraud.

I believe however that many doctors do game the Medicare system, such as requiring their patients to come frequently and ordering batteries of tests, or prescribing drugs that do more harm than good by turning the patient into a zombie. A senior's family is the best guardian against such abuse.

[WOBBLY BOB]

BTTT

[Skooz]

bump for later reference

[DannyTN]

Don’t forget the 3rd claim that it is self serving for the FBI to say fraud is high. A claim which should be self evident.

No source for the first two. Just I’ve worked in the Medical field and can tell you that most providers are legitimate. The few examples of people committing fraud that I’ve seen, were quickly reported by other medical professionals.

[DannyTN]

And I also know that Medicare has a history of denying claims on technicalities, where legitimate service was provided to patients. My mother worked for a hospital in the 1980’s that sued Medicare over denials and won 465 of 466 cases in administrative law court. And they didn’t understand why they lost the one.