Sunday, September 6, 2009

Healthcare: Two Birds With One Speech

On, Josh Marshall made a very good point: Obama needs to attach "the public option" to medicare, because no politician in his or her right mind would attack medicare.

The easiest way to do that?  Make medicare the public option.

It's a deceptively simple idea.  Tell those who are under 65 that they can, if they wish (no mandate here), buy into the medicare system.  Once they reach 65 they would be covered as seniors are now.  They can buy private insurance if they want, but entering medicare early would be an option too.

Why is this a good idea?
  1. It's easy to sell.  Everyone loves medicare, or at least is unwilling to admit that they don't.
  2. It's not "creating a new program", it is extending an existing one.
  3. Medicare is a great success with one exception: it is in real financial danger.  Could this also save medicare?
Ask any public insurance executive what one does when there are money problems.  He'll tell you, you must raise rates, or cut benefits, or expand the number of people insured (spread the risk more broadly). 

Medicare, as currently configured, only admits those over 65.  I think it is safe to assume that older folks are more prone to illness.  Allowing younger people in would increase the pool, bring in funds (remember, the young have to pay for medicare), and change the actuarial balance to include those who are less likely to become ill.  That's how you run an insurance company.

There are some moving parts and details to deal with, such as letting the poor in for a a reduced cost (or even free), reforming aspects of insurance that are a problem in and of themselves (pre-existing conditions, portability, etc...) but these reforms would simply apply to medicare exactly as they apply to private insurance.

The right will argue that employers will move their employees to medicare due to the cost saving, and this will drive private insurance out of business.  True, unless private insurers provide a better service for less.  Are we saying they cannot, that private enterprise cannot compete with a government-run program?  Hm.  That does not sound very capitalist at all, does it?

Extended medicare by making it a volutary buy-in for those who want it would seem to be easier to explain, defend, and implement than either a separate public option, or the establishing of "co-ops".  I think Marshall may be right; that this is what Obama should propose.


  1. That is an AWESOME idea. I am 28, healthy, employed (without insurance) and would PAY GOOD MONEY to buy into medicare! Why won't they let us do this?

  2. Probably is too simple for Washington that just may work.

  3. Yes, yes, yes. Merge Medicaid into Medicare (that covers the poor and the disabled) - which means merging their budgets and, I assume, eliminating overhead and duplication of jobs, systems, etc. You might even merge the VA into Medicare while you're at it for even more overhead cost savings. (In order to placate those who rightfully argue that veterans deserve the best, call it Medicare+ or something and give them extra benefits. Easy enough to differentiate between people in a database, no?) Merge government insurance (like that used by Congress) into Medicare too. (Make it Medicare+ if you must to push this reform through.) Let anyone who wants to buy into Medicare do so at reasonable rates. No more recission, no more pre-existing conditions, no more dropping people when they become terribly ill. Subsidize medical students who study primary care to increase the number of primary care doctors available and make sure that we keep a large population of nurses too (they're the ones who are on the "front lines," administer treatments, catch mistakes, etc). Mental health gets parity with physical health (there is no logical reason for there to be a difference). Oh, and while we're at it, let Medicare (and private insurers) negotiate with pharmaceutical companies for reduced prices on medications.

    Aside from regulatory reforms, private insurance can keep on keepin' on. They'll be able to compete with Medicare if they try spending money on patients and services instead of excessive lobbying, advertising, and executive compensation packages.

  4. No need to give them 'extra' benefits, just make it free for life for them and their current spouses and their kids (until 25 if still in school full time)... they've paid enough risking (or giving) their lives for, what - 50 cents an hour?

    And perhaps you're unaware of it (if you're unemployed), but every worker in the US already pays into medicare/medicaid - its deduction is itemized as FICA-HI on your paystubs.