Posted on 05/09/2007 5:01:08 AM PDT by Brilliant
What's going to happen when the money runs out for Medicare? A recently released report by the program's trustees found that within seven years Medicare taxes will fall short of Medicare expenses by more than 45%. What's more, Medicare and Social Security combined are on track to eat up the entire federal budget...
The projected cash flow deficits in these two programs are staggering. For Social Security, the trustees estimate the 75-year burden on general revenues at $6.7 trillion. For Medicare the comparable burden on general revenues is $24.2 trillion... Thus the total burden these programs will impose on federal finances over the next 75 years is $31.9 trillion...
Members of Congress will not have to wait long to experience the practical effects of all of this. Until a few years ago, Social Security and Medicare were taking in more than they spent... Thus they provided revenue for other federal programs. That situation is now reversed, and last year the combined deficits in the two programs claimed 5.3% of federal income tax revenues. In 15 years these two programs will require more than a fourth of income tax revenues...
Could we force the elderly to pay for future deficits with higher Medicare premiums? Monthly premiums in constant dollars would more than quadruple by 2020, and be almost 30 times their current level by 2080...
Using taxation to fund the projected Medicare shortfalls is equally unpalatable. We would need a 10% increase in all nonpayroll taxes by 2020 and a 50% increase by 2080...
So what else can be done? ...On the demand side, someone must choose between health care and other uses of money... On the supply side, the way health care is produced must fundamentally be changed, replacing cost-increasing innovations with cost-reducing ones...
(Excerpt) Read more at online.wsj.com ...
See my explanation above. It costs them a fortune to produce those doctors. That is one reason that they must ration health care.
So, as much with all levels of government, does anyone see where the problem lies?
Believe me, doctors are earning less. They pay a huge price to become trained. If they earned even less because of increased supply, fewer and fewer quality people would choose to make the sacrifice.
That won’t go over well with all of us that are paying medicare taxes now.
Well, sure, the rewards could go down, but only if the supply went up as a result of that action. If a lot of folks like you decided it wasn’t worth it, then it would not change anything. But the market should make that decision, not the AMA, medical schools, and teaching hospitals. And certainly not government.
The potential entrants in virtually every other profession have the same decision to make, and it works just fine in those professions. Inevitably, a higher educated profession is going to generate higher rewards because some people are either unwilling or unable to get the education. If we let the market decide, it’s not like the bottom is going to fall out and physicians’ incomes are going to sink to the level of a factory worker. They may go down slightly, but the profession will still be lucrative, and the supply of healthcare will increase, thus greatly easing the healthcare dilemma we currently face.
An increased number of doctors may even make the physician’s career a more enjoyable one. The long hours may not be necessary.
The major problem with our healthcare system is not “the payor system” or the “cost structure.” The major problem is that the regulators have goofed up so royally that the supply is vastly out of step with the demand. And unfortunately, as is typical in a system based on central planning, they are doing absolutely nothing about it, other than making cosmetic changes to hide the problem, like using “managed healthcare,” where bureaucrats effectivley decide whether you can have a particular healthcare service rather than letting you decide that based on a price determined by a free market. That’s a cosmetic change because it appears to reduce the cost of healthcare, but only by introducing additional costly distortions that are not reflected in the price structure.
“The growth in the number of doctors and technicians is not keeping up with the demand, even at the suppressed levels of demand we’ve got. “
You are going to have to fundamentally change our legal system so one wrong diagnosis doesn’t end a medical career.
Cap on payouts? I don’t know.
“It costs them a fortune to produce those doctors. That is one reason that they must ration health care.”
I’m sorry, that just makes no sense.
Of course, the EU does not really have a free market economy, so I guess it doesn’t need to make sense.
I have met Tom Savings at a week long SS seminar sponsored by CATO. He is a stand-up guy who knows more about Medicare and SS than any person I have ever met. He has been on the SS Board of Trustees for a long time. He is for personal accounts and makes no bones about the fact that SS is a pay as you go system and that the SS Trust Fund is a charade. So I would pay attention to his "mumbo jumbo" because he knows what he is talking about.
If they really want to fix this problem, what they've got to do is increase the number of doctors and other healthcare technicians at a more rapid rate. The growth in the number of doctors and technicians is not keeping up with the demand, even at the suppressed levels of demand we've got.
And where does the money come from to pay for their services? Our ERs are being inundated by the uninsured, many of them illegal immigrants. There are more than 50 million on Medicaid, which is bankrupting the states. Couple this with the baby boom cohort, which will be retiring in a few years and you have a real crisis.
The truth, though, is that both social security and medicare are headed for the ash heap of history. It's too late to fix them.
I fear it will be the US that goes to the ash heap of history because of these systems. The Dems and their allies like AARP are committed to keeping the systems in place, tweaking and expanding them until they bankrupt the country. The entitlement programs, according to David Walker, GAO, represent more than a $65 trillion unfunded liability. They are on automatic pilot in terms of the budget with formulas dictating benefits.
48 million Americans receive Social Security benefits, including 33 million retirees, 7 million survivors, and 8 million disabled workers. By 2030, there will be 70 million Americans of retirement age--twice as many as today.In 1950, there were 16 workers paying Social Security taxes for every retired person receiving benefits. Today there are 3.3. By 2030, there will be only 2.
The SS "surplus" starts declining next year and by 2017 Social Security will begin running a deficit. The last time this happened, in 1983, the Dems and Reps struck a bargain with the devil signed by Ronald Reagan, that increased taxes and decreased benefits, including raising the retirement age for full benefits to 67. I believe something similar is going to happen after 2008, with both parties kicking the can down the road again rather than take the tough decisions to solve the problem. And each time they kick the can down the road, the problem gets even worse and more difficult to solve.
Spoken like a true socialist.
I agree that tort reform would help a lot, but that’s not the entire story. Medical practice is a very lucrative profession even after you consider the cost of malpractice insurance and the cost of medical school. And it will always be a lucrative profession, even if we eliminate some of the supply restrictions that we currently have, for the simple reason that certain people have scarce cognitive abilities that others do not.
Doctors are only a small portion of the total health care bill. What do you do to about hospitial and medical equipment costs? Perscription drug costs? Nurses? Lab technicians? Hospital administrators?
Dumb, dumber, and dumbest.
The SS "surplus" starts declining next year and by 2017 Social Security will begin running a deficit. The last time this happened, in 1983, the Dems and Reps struck a bargain with the devil signed by Ronald Reagan, that increased taxes and decreased benefits, including raising the retirement age for full benefits to 67. I believe something similar is going to happen after 2008, with both parties kicking the can down the road again rather than take the tough decisions to solve the problem. And each time they kick the can down the road, the problem gets even worse and more difficult to solve.
The solution may be as simple as returning the system to actuarial soundness. The problem is people are living too long compared to when it was begun. There is a retirement age that would restore the 16:1 ratio again. Whether that is politically possible, I cannot say.
If the need for a 50% increase in nonpayroll taxes is based on static analysis, the sort of analysis that assumes that the increase in the tax rates will not have an effect on the economy. Actually a 50% increase in rates will stifle the economy and reduce the actual revenue to the government, thus exacerbating the problem. If the need is for 50% greater income then the solution would be to seriously lower rates. It is difficult for politicians to comprehend that revenue actually tends to rise when rates are lowered so the actual “answer” will be most likely the self defeating one. When the crunch gets too tight, of course, the answer will be to nationalize everything.
Malpractice insurance is only the tip of the healthcare cost iceberg. Add to that the cost of often unnecessary tests to cover the doctor's a**. That practice started in the mid-70's and has expanded.
Medicare B is already means tested in terms of the premium pay. It is a two tier system with those making less than $80,000 a year [$160K for couples) paying one premium and those making more another. This is the start of means testing. I might add that Medicare B is a line item on the federal budget and its premiums are actually tied to costs, so that the premiums are automatically increased unlike Part A, which is heavily subsidized out of general revenues.
Once the direct connection impacting the consumer’s wallet is severed, there is nothing that will slow down the price increase engine until it flys apart in pieces.
Well there is, but it is rationing or full government control of healthcare which amounts to about the same thing.
Okay than lower the income requirement.
Republicans agree on one thing and that is the need to reform both SS and MCR.
Maybe a start would be to eliminate the RX bill atached.
BTW thank you for the intelligent response unlike the idiot who called me a socialist.
atached. = attached
Spoken like a true socialist.
Yes ...... as long as we try to mandate “compassion” then we are screwed.
I know this sounds really harsh ... but .... it’s not my responsibility to provide for anyone but myself.
Government needs to get out of the “compassion” business.
All these programs have done is hamper the “free market” of love and compassion.
It’s a shame.
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