Friday, May 13, 2011
'Save' would kill Medicare
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Theodore Fuller
Fuller is a professor of sociology at Virginia Tech.
The Medicare program faces tremendous financial challenges. Rep. Paul Ryan, R-Wis., proposes to "save Medicare." But his proposal to save Medicare reminds me of the U.S. major who declared during the Vietnam War, "It became necessary to destroy the village in order to save it."
Basically, Ryan's proposal simply gradually transfers the cost of Medicare from the federal government to seniors. Since, under Ryan's plan, seniors will pay a higher and higher percentage of their own health care costs and the government will pay a lower and lower percentage of their health care costs, his plan will literally destroy Medicare.
His plan directly affects only those who are 55 years or younger, not current seniors. However, many seniors are opposed to his plan for two reasons. First, seniors understandably want the program to benefit their children, who might be reaching the age of 65 in a decade or two. Second, seniors are rightly concerned that if Medicare is pared back for people age 55 and younger, it may later be trimmed for themselves.
Medicare is funded by payroll taxes. Most of today's seniors paid into the system for their entire working career, which is why Ryan's proposal does not reduce their Medicare benefits. However, all current workers have been paying into Medicare for their entire careers, also. Why should Medicare benefits in retirement be cut for workers now younger than 55?
If Ryan's proposal is enacted, today's workers -- who will be paying payroll taxes to support Medicare for today's seniors -- will come to realize that they are paying taxes to support a program that is more generous than the one they will enjoy when they retire. It would be understandable that, if Ryan's proposal is enacted, today's workers would balk at paying taxes to support Medicare for today's seniors. The entire program would begin to unravel.
We all hope to be seniors one day. Thus, it is in the interests of everyone to find a better solution than simply shifting the costs of health care for seniors from the federal government to the seniors themselves.
Ryan's plan does not address the real problem Medicare faces: not that the federal government is paying too much, but that health care costs too much in this country. The annual cost in the United States is about twice as much per person as in other wealthy countries (about $6,300 per person per year versus about $3,300).
So, rather than simply shifting this heavy burden to seniors, it would be better to figure out why our health care costs are so high and figure out how to reduce overall costs. Solving that problem would not only help reduce costs for the government and seniors, it would also reduce costs for families and corporations.
One might wonder about the quality of health care in countries that pay only half as much as we do. In general, the wealthy countries (e.g., Germany, France, England, Canada) that pay far less for health care than we do enjoy higher life expectancies and lower infant mortality rates. They often pay less for pharmaceuticals manufactured in the U.S. than Americans pay for the same drugs.
The health care reform law passed in 2009 will contribute to lowering the cost of health care (or at least slow the increase in cost), but it does not go far enough.
We need to move to a single-payer plan, in which the federal government pays for all legitimate health care needs. This is not the same as socialized medicine. Socialized medicine is a system in which the government actually hires the doctors and nurses, owns the hospitals and health care clinics and so forth. Several immediate savings come to mind.
One, no need for the billions of dollars insurance companies and hospitals pay for advertisements. Two, no multimillion-dollar salaries for CEOs. Three, no need for the billions of dollars in profits for shareholders. Yet, under the single-payer plan, all could go to the doctor they prefer -- just as folks with Medicare go to the doctor they prefer.
A single-payer plan (Medicare for all) will lead to lower health care costs, which will be good for grandma, good for the government, good for General Motors.
