The politics of debt have gotten so insane that both parties are on the verge of gutting Medicare. The moment might be right to actually fix it.
Most of us who are now approaching retirement age or are younger have spent our entire lives living with, and largely accepting, some constraints on our choice of doctor, if only through the limits imposed by preferred provider networks. Personally, not once since I was still young in the early 1980s have I been part of a health insurance plan that allowed me to choose any doctor I wanted without paying a financial penalty, and I’ve had what by the standards of the times has been “gold-plated” coverage. Almost the only people left in America who don’t face such restraints are current beneficiaries of feefor- service Medicare.
That said, a plan like this could still provide future Medicare beneficiaries with plenty of options. In addition to being able to choose among competing Medicare-eligible HMOs, seniors should also be free to use their own money to pay to see any doctor they want or to access experimental drugs or unproven treatments that the HMOs (wisely) won’t cover. If the “price” of preserving Medicare is that some of us will be sometimes forced to go “out of network” and pay more of our own money to receive some kinds of care, then I think younger Americans already inured to the practice will almost certainly be willing to pay it.
To those who disagree, we could offer an additional choice: If you wait until you are, say, age seventy to apply for Medicare, then the system will cover you for the same wasteful fee-forservice medicine your parents currently get. But if you want to be covered at age sixty-five, you’ll have to agree to receive your care from a Medicare-certified nonprofit HMO.
These are tough choices, no doubt. But ask yourself: Do they sound all that onerous when compared to the competing policy proposals already on the table, such as turning Medicare into a voucher program that leaves all of us responsible in old age for paying 70 percent of our own health care costs, or seeing Medicare reimbursement rates reduced to the point that we can’t find a doctor who will treat us, or having to wait until age sixty-seven before being eligible for Medicare at all?
We can certainly expect lots of opposition from wellheeled practitioners of for-profit medicine—all those cardiologists making a killing doing unnecessary stent operations, for example. And we’ll hear from many prestigious academic medical centers, an unfortunate number of which engage in massive amounts of overtreatment because they are dominated by specialists who look down their nose at doctors engaged in “mere” primary care.
Yet as difficult as these challenges will be, reformers are now armed with abundant, peer-reviewed proof of just how dangerous and wasteful fee-for-service medicine has become, and the public has begun to catch on as well. Ten years ago, for example, researchers were just beginning to document how the death toll of medical errors, hospital infections, and inappropriate treatment had conspired to make contact with the health care system the third leading cause of death in the United States. Today, these facts are widely accepted by heath care experts and generally understood by policy makers at the highest levels of government. Educated Americans have read about them in the newspapers, and most citizens who have spent any time in a typical hospital trying to make sure a loved one gets her proper medicine on time have experienced firsthand the extent of routine system breakdown.
Some conservatives, no doubt, will instinctively align themselves with the forces of for-profit, fee-for-service medicine, or be lured into doing so by heaps of campaign contributions. Many Democrats as well can be counted on to carry water for prestigious but deeply wasteful and dangerous academic medical centers, which tend to be concentrated in Deep Blue zones like New York, Boston, and Los Angeles. So yes, enacting this proposal will not be easy.
But then, ask yourself again, compared to what? Both parties have already signed on to changes to Medicare that are hardly less radical, will be resisted by powerful interest groups, and risk the wrath of voters. Moreover, these proposals are not really solutions, because they either shift the inflating cost of health care onto individual Americans or cut reimbursement rates to a point where Medicare is “saved” on paper but in the real world has little value to elders who can’t find a doctor. By contrast, this approach directly attacks the root problem, which is the waste and inefficiency caused by fee-for-service medicine.
And as politically difficult as the road to this solution may be, it does give each side things it wants. It allows Democrats to say that they will not cut benefits to Medicare recipients. And Democrats should also like that these nongovernmental organizations serving the Medicare population will have the freedom to do things liberals have long wanted Medicare itself to do, like bargain with drug companies for lower prices. Meanwhile, Republicans who support this proposal will be able to boast that it takes vast decision- making power out of the hands of “unelected bureaucrats in the federal government” and puts that power in the hands of private organizations that compete with each other for customers. Under this approach, Medicare officials won’t have to figure out how to write regulations on what specific drugs and procedures are not appropriate medicine; they’ll be contracting out those details to private-sector organizations and simply holding them accountable for results, such as keeping a high percentage of their patients healthy and managing their conditions effectively.
Let’s close by stressing the positive. America is still a rich and productive country. Compared to Europe or Japan, it has a youthful population and no real long-term debt crisis except that caused by huge volumes of wasteful and dangerous fee-for-service medicine. So once again in our long history, Americans can have their cake and eat it too. We can improve our health care while lowering its cost, and in the process eliminate our long-term deficits and resume building for future.
So why don’t we feel more optimistic? Because there is this feeling of despair, especially among policy makers and the chattering classes, that we don’t know how, politically, to bring health care costs in line. We know that all other developed countries get better health care for less money, and that it is no real mystery how they do it. But all their approaches seem—or can be spun as— socialistic, paternalistic, and fundamentally un-American, and therefore impossible to consider.
Yet we have within our reach a solution that is not imported from abroad, and that has been proved on our own shores by all-American institutions, from our best nonprofit HMOs to the VA health system. We may not currently have the political will to use these institutions as the model and means to fix the health care crisis, and hence eliminate our long-term fiscal problems. But we shouldn’t fool ourselves into thinking it can’t be done.
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