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Everybody likes Medicare, so why not try it for everybody?

The other day Rep. Michele Bachmann was taking a hit at President Barack Obama: She accused the national health-reform law of trying to destroy Medicare and force the evils of Obamacare onto the elderly. That Obama. But really, isn’t it interesting that even Michele Bachman jumps up to defend one of our nation’s largest socialist programs? Why is that? Why is it so popular that Paul Ryan may meet his political demise by trying to gut it? Over the weekend Medicare had its 46th birthday, and I want to write a little about why we should be celebrating.

First of all, Medicare saves money. Its overhead is between 1-3 percent, in contrast to the private insurance industry, which has administrative and profit overheads of 10-25 percent. That is a savings of 10 to 20 percent.

Also costs don’t increase as fast in Medicare as they do in private insurance. We are a nation with a lot of new health technology, we live longer and this does cost money. For example since 1970 the cost of medical care adjusted to inflation has gone up 400 percent. That is a big increase, but the same time period from 1970 to today the cost of private insurance adjusted for inflation has gone up 700 percent.

A good deal for taxpayers
We also know that Medicare is a good deal for the taxpayers by looking at Medicare Advantage Insurance programs. This was the attempt by the Bush administration to create ‘competition’ by privatizing some Medicare programs. They have shown to waste billions of dollars by charging more for healthier patients and then dropping those same patients once they become sick. It is called “picking the cherries and spitting out the core,” and it is a real phenomenon. The Obama’s Affordable Care Act is slowly shutting down the wasteful private health-insurance options for Medicare.

So all we need to do to make Medicare financially solvent is to increase the payroll tax by a small fraction of a percent. The rate has only been increased once, in the mid-1980s, and it is time to do it again.

Efficient, effective
Medicare is an efficient, effective way of health-care financing. It is what we all want for our parents and ourselves as we get older — and, heck, it probably is a good idea for the entire nation.

If we had Medicare-For-All, maybe it would be so popular that Michele Bachmann would be forced to defend it, too.

Elizabeth Frost is a family doctor practicing in Minneapolis. She co-chairs the Minnesota Chapter of Physicians for a National Health Program.

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Comments (17)

  1. Submitted by rolf westgard on 08/02/2011 - 06:57 am.

    Way to go Dr. Frost. The clowns who have just finished performing in St Paul and D.C. legislatures just don’t get it. I’m not sure what it will take when we can see the success of Medicare and the single payer systems in the rest of the developed world. Add the lower cost younger people to Medicare and you have a winner.

  2. Submitted by Dennis Tester on 08/02/2011 - 08:27 am.

    Because we can’t afford it. We already owe $14 trillion. What is it going to take to teach these people that the taxpayers don’t have an unlimited amount of money to pay for your wants and needs.

  3. Submitted by Hiram Foster on 08/02/2011 - 08:57 am.

    Other, poorer, countries seem to be able to afford national health care without too much stress.

    Why can’t we?

  4. Submitted by myles spicer on 08/02/2011 - 09:06 am.

    The simple and sad answer is, conserevatives have demonized the program — largely with misinformation. Extending Medicare instead of crafting a whole new (and complex law) was the easy, smart, and effective answer to health care reform. But because of the bad rap conservatives pasted on it, it became the third rail of politics.

    My favorite sign at Tea Party protests was:


    (My second favorite was: NO PUBIC OPTION)

  5. Submitted by rolf westgard on 08/02/2011 - 09:23 am.

    Dennis: What is it going to take to “teach these people” that our inefficient medical system is a major reason for that $14 trilion debt. We spend twice as much per person on medical care as other developed nations do, with often poorer results.

  6. Submitted by dan buechler on 08/02/2011 - 11:03 am.

    This would be a lifesaver instead of the current fraying patchwork.

  7. Submitted by Lyn Crosby on 08/02/2011 - 12:23 pm.

    MN State Senator made the same argument this year about our publicly paid health care programs, and suggested that legislators use the same system. Of course there were a dozen excuses!!

  8. Submitted by Lyn Crosby on 08/02/2011 - 12:23 pm.

    Oops, I meant to add that it was MN State Senator Barbara Goodwin!

  9. Submitted by dan buechler on 08/02/2011 - 02:28 pm.

    #7 actually she suggested that the legislatures go on the health voucher programs they passed.

  10. Submitted by Bernice Vetsch on 08/02/2011 - 06:03 pm.

    Mr. Tester: Harvard researchers have found that instituting a Medicare-for-All type system would save us as a nation $400 billion per year, much of it in the excess paperwork carried out by insurance companies and by health care providers who have to comply with the record-keeping and reporting requirements of many different insurers instead of just one.

    The larger the risk pool, the more widely spread is the risk. Hence, a single risk pool comprised of the entire population would be the cheapest possible system.

  11. Submitted by Tom Anderson on 08/02/2011 - 08:23 pm.

    Medicare is a wonderful program! It pays probably 50% of the actual costs of services. As long as private insurers (and the rest of us) pay more to make up the difference, it can last forever. Medicare and Medicaid already blow through more money than Social Security and national defense combined. By 2024, the hospital insurance trust fund is projected to be exhausted, just in time for the new 52 mpg standard for automobiles.

    Don’t forget, Medicare is prohibited by law from considering price or cost effectiveness when determining whether to pay for procedures, drugs, or devices. Oddly, private insurers consider these things as they actually have to pay for them. Medicare is also prohibited by law from using it’s vast purchasing power to negotiate lower prices. Let’s get everyone on this program!

    Check out Eric Wieffering’s last Sunday’s business column for more…

  12. Submitted by rolf westgard on 08/03/2011 - 08:05 am.

    Tom: First you say that Medicare is paying very low prices for the services received. Then you say Medicare can’t negotiate lower prices for services received.
    It’s really wonderful that we have health care ‘experts’ like you and Eric Wieffering to look after us. Both of you would fit nicely in the MN legislature.

  13. Submitted by Tom Miller on 08/03/2011 - 11:03 am.

    There are several parts to Medicare. Part D, which pays for drugs, cannot negotiate prices with drug manufacturers. The pharma companies set the rate that the government pays, except in the donut hole, where seniors pay the full overpriced load. This is the Bush giveaway to big pharma.

    The other parts of Medicare dictate reimbursement rates for various procedures, without regard to the cost of delivering the procedures. Most of these rates do not cover doctors’ and hospitals’ costs of providing the services (let alone allowing profit on them).

    What Medicare has done is drive private physicians out of business; they can’t run a business when revenue is less than expenditures. Medicare has also fueled the corporatization of medicine (HMOs, etc.) because these large organizations can charge more in profitable areas and shift the cost to cover Medicare reimbursement losses. Also, the large organizations’ market share increases because the private practices are run out of business.

    Conservatives will play both sides of the issues. They can frighten seniors by claiming that Obama will take Medicare away, while at the same time decrying socialized medicine.

    Conservatives will claim that the private sector can do it better and cheaper (as if the private sector has proven that point already…). If Medicare goes away, it will increase the hold that the private sector will have on medical delivery, and corporations will dictate prices.

    In either case, we will have some form of monopoly medicine. Either the government will provide it, and we can vote the bums out if they don’t deliver; or the private sector will provide all medical care and we will be at the mercy of plutocrats.

  14. Submitted by Annie Grandy on 08/05/2011 - 05:02 pm.

    Medicare needs to be tweaked to be a truly responsive single payer health care system, especially adding the negotiation of drug and care prices for volume as the Veterans Administration does.
    That said, currently Medicare, with only the unhealthiest, most vulnerable, and riskiest portion of the ‘health pool’ paying in, is, of course, going broke.
    An insurance pool works only when the entire pool, least healthy to most healthy and everyone in between, is included and paying into the system. Open up Medicare to everyone, require that everyone pay into the system and it will last forever.
    (Just think of all those obscenely huge CEO salaries and perks eliminated and spent on health care. That alone is a lot of health care.)

  15. Submitted by Morgan Matthews on 08/05/2011 - 07:19 pm.

    “Medicare for All” is what we will get once the current Depression threatens to destroy the health care industry. Until then, while there is still wealth in the middle class to extract, we will hear foolish quibbles like, “We can’t afford it.” Because apparently some folks believe we can afford the exorbitant costs added to health care by the private insurance system. Once a critical mass is reached, of employers and individuals who can no longer afford the graft-ridden system we have now, then we will open up Medicare to everyone.

  16. Submitted by Bernice Vetsch on 08/06/2011 - 08:31 am.

    In June 2009, the Center for American Progress released a study called “Health Care Competition,” a state-by-state listing of the insurance companies that hold major market shares.

    From 2000-2007, the number of insurers fell by 20%, leaving 10 extremely large companies that control most of the US market. These 10 firms increased their profits during the same period by 428 percent in two ways: by raising their prices every year and by reducing the amount paid out each year, often by denying payment of claims or by refusing coverage to those who seemed likely to get sick.

    In Minnesota, Blue Cross/Blue Shield controls 50 percent of the market and Medica (a UnitedHealth Group company) 30 percent, leaving 20 percent to other insurers.

    With Medicare for all, every American would have the peace of mind that comes from knowing they cannot lose their coverage. Every business would be relieved of the burden of providing coverage for employees, and employees would not have to stay in jobs they hate just to retain coverage.

    Everybody wins.

  17. Submitted by jody rooney on 08/07/2011 - 11:46 am.

    I highly recommend that everyone who is interested in the health care issue read “The Healing of America” by T.R. Reid.

    We do have the most costly system in the developed world with health expenses about double as a percentage of GDP and we have a lower infant mortality and longevity than other countries. If you want to check on the data use the CIA world fact book and the World Health organization web pages which are very easy to navigate.

    As a society we have not agreed on the basic argument is do all people have a right to health care when they are sick. If that is a right how do we then draw lines. Right now we are drawing them at age, significant disability, renal failure, and poverty. The gap is for the relatively healthy, the least costly, generally least vulnerable. That that part of the system should be left to individuals and employers seems ludicrous and economically irrational. Maintaining your most productive human capital seems like a societal interest and should probably be addressed as such.

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