Sunday, April 21, 2013

Let's Look at the Underlying Problems in Medicare from a 'Fairness' Standpoint, Not Just 'Numbers'

Carlton Fisk's Home Run 1975 Home Run:
'Make it Fair! Make it Fair!'
One of the problems about dealing with and debating an issue as big and as complicated as Medicare is that most people simply don't care what it costs to take care of senior citizens.

Certainly not the senior citizens currently on Medicare. It is the best deal in the nation they are ever going to get in terms of buying health insurance for around $310-$360/month. Many self-employed people now paying close to $1000/month would give their eyeteeth and other certain parts of their body to be able to find ANY comprehensive health care insurance for anything near $350/month.

We would do that in a flat skinny nanosecond. You may be paying that much or more in withholding per month from your paycheck if you work for a large corporation. Check it out and see.

Every senior citizen in this nation has either been hypnotized or self-deluded into thinking that their $320-$360/month payment for their Part B premium covers 100% of the cost of their health insurance under Medicare. The actuarial average for covering any senior citizen is between $1200-$1500/month according to health care insurance professionals.

You, the working taxpayer, are making up that difference every month to the tune of a 75% general taxpayer subsidy to every senior on Medicare in America today. If you paid $1000 in Medicare payroll taxes in 2012, you paid for a very small part of the time a particular senior stayed in the hospital (Part A) during the year. If you paid income taxes of any magnitude, you probably paid for several months of subsidy for any single senior citizen on Part B...and not much else.

There is absolutely no way on God's green earth that any senior's payment of $320-$360/month is going to cover the entirety of their health care insurance coverage. No way. And yet many people still believe it...or wish it to be so just because they say it is so in any campaign promise to get re-elected.

If you don't have current health care coverage, the chances of your being able to buy comprehensive health care coverage under the looming Obamacare exchanges for a family of four for around $350/month is about as remote as the chances that the sun will rise in the west tomorrow morning.

As in 'None'.

Conservatives and budget wonks and wonkettes often fall into the trap of discussing the immense cost of Medicare ($551 billion last year or about 15% of the entire federal budget all by itself); the unlimited payroll tax that is mandatory on everyone's income at the same flat rate of taxation at 1.45% on earned income for every rich, moderate and poor wage-earner; and the fact that the Social Security/Medicare Trustees have been warning Americans for years now about the 'looming insolvency' of the entire program.

(Whoops! There we go again)

Nothing has changed. Certainly not under President George W. Bush and the Republican Congress who invented Medicare Part D and passed it in 2003 which will cost untold trillions when all is said and done because there was no funding mechanism or spending offsets to cover the cost of the new entitlement.

And certainly not under President Obama and the Democratic Congress from 2009-2011 who saw the Medicare (broken) model and figured:
'What the heck! Let's just pass Obamacare and act like it is Medicare Parts E,F,G,H,I,J,K,L,M,N,O,P,Q,R,S,T,U,V,W,X,Y and Z...and some other Greek and Latin letters of the alphabet to boot for good measure!'
In short, Medicare is a total mess and one of the prime upwards drivers, along with Medicaid, of our exploding budget deficits now and far into the future.

But what about the underlying 'fairness' of Medicare in the first place? That is what drives most of America political decision-making on the part of voters, not 'numbers'.

Is Medicare 'fair'? If not, then why not change it to make it more fair to everyone involved, including the future generations who have to not only pay for Medicare today but for the debt that is building up mainly because of Medicare growth over the past 25 years?

Before passage of Medicare under LBJ's 'Great Society' in 1965, millions of senior citizens were living below the poverty line. Many got there due to lack of adequate health insurance coverage when a life event wiped out their savings or cost them their homes.

No one wants to go back to those days. No one. Not even the mean old Republicans or the Tea Party.

However, seniors now living in America are living in perhaps the overall 'best' condition of any senior cohort in American history in terms of having guaranteed income and health care benefits through Social Security and Medicare support paid by working taxpayers today.

NONE of it is a result of being qualified due to financial distress or low income, by the way.

It is solely because every senior now alive who is receiving those benefits has passed the magic age of 65 to be eligible for Medicare and 66 for Social Security.

See? The retirement age has already gone up for SS as a result of the 1983 Social Security Act and no one knows the difference.

In 2022, the age to be eligible to receive full SS benefits will start to go up again in 2-month increments until 2027 when you will have to be age 67 to get full SS benefits. Again, no one knows that this is current law or else they would be screaming about it, wouldn't they?

Wouldn't it be more 'fair' just to raise the retirement age to 67 for both Medicare and SS by say the year 2020 and get it over and done with, say this year? There can be exemptions for severe disability or early benefits such as exists for SS, even though we think early eligibility should be moved up to age 65 instead of staying at age 62 due to the much longer lifespans Americans are enjoying, despite our atrocious diets and lack of exercise.

But beyond that, is it really and truly 'fair' that every senior should be able to get full medical coverage under Medicare without ANY regard to their financial net worth; retirement income and general financial status?

We can buy the argument that perhaps low-income seniors and many moderate-income retirees may need some graduated assistance to buy market-priced health care insurance.  But should Warren Buffett, Bill Gates and other super-wealthy people honestly be 'eligible' for what amounts to massive taxpayer financial assistance each and every year that makes what we pay in the form of welfare to poor families seem positively puny by comparison?

A super-wealthy person who gets a new heart, lung, knee, shoulder or hip may have Medicare paying hundreds of thousands of dollars to their surgeons and doctors, all because of the mere qualification that they are over the age of 65 and by virtue of having paid into Part A for their working careers and $360/month for Part B while in retirement.

Warren Buffett. Bill Gates when he retires. Super-wealthy seniors such as these two fellows who can buy 10 hospitals on their credit cards and we more modest-income taxpayers are massively subsidizing their health care costs in America today?

Is that fair?  We say it is not.

Here's another thought-bomb that is sure to break up a good dinner party discussion with any senior citizen you may know or be related to:
The Cheetos/Twinkies/Beer/Burger Diet
'Is it 'fair' to just pay every Medicare claim put before the CMS bureaucrats just because someone is over the age of 65? Or does every senior have the personal duty and responsibility to improve his/her own diet; stop smoking; quit drinking moonshine and a case of beer every night while eating bags of Cheetos and boxes of Twinkies and not exercising one step any day of the week, month or year?'

Again, we think not.  We think that whenever taxpayer money is involved, our elected leaders in Congress or the state legislatures not only have the right but the responsibility to put conditions on the behavior of the receiving party so as to protect the hard-working taxpayer from having to pay money for others who don't take responsibility for their own behavior and actions.

That is only 'fair'. Since 'fairness' might be the one noun that binds us all together as Americans other than the 'freedom' our forefathers and ancestors fought so hard to give to us in the first place, it might be high time that we start demanding 'fairness' in the ways we point out above in Medicare to start with.

'The Hounds from Inflation Hell!'
'Fairness' is easier to sell than 'the threat of having national debt reach 200% of GDP' which no one really cares about....until and unless the 'Hounds from Inflation Hell' are released as a result, right?

By then, it is too late. We would prefer to see America take control of its own destiny. Discussing 'fairness' might be the best way to do it.

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