Tag Archives: Medicare

Consumer Choice in Health Insurance Markets Under the Affordable Care Act

If you’ve never had to shop for health insurance, consider yourself lucky. Between searching for affordable premiums, making sense of co-pays and coinsurance, and finding a plan with your favorite doctor, choosing a good health plan can be a daunting task. As a health policy student, I tried my hand last month at choosing a plan on the North Carolina exchange. Despite being well-versed in insurance concepts, I too struggled to figure out which plan would be best for me among the many options.

The Affordable Care Act (ACA) has been successful in its goals of increasing access to health insurance while preserving choice and competition in health insurance markets. It brought nearly 11 million people into the individual market who previously didn’t have insurance, and it offered them a variety of health insurance options to choose from. Despite achieving such historic milestones, however, it remains to be seen what the future might hold for the ACA. Until then, policymakers must continue working to make the process of buying insurance easier for the average American. Continue reading

Medicare Lessons from Peanuts

By Ryan Hoerger

Charlie Brown’s struggles kicking the football are well-documented. Whenever he runs to try, his friend Lucy always pulls it away, leaving Charlie lying on his back, duped once more.

In proposing legislation to raise the eligibility age for Medicare to 67, the Republican Party and its wealthy special interests are taking a page straight from Lucy’s deceptive playbook. Aging members of the workforce have spent their entire careers paying into the system, and conservatives are now trying to whisk away two years of government-provided health insurance that they both expect and deserve at the last second.

Under false pretenses of fiscal responsibility, Republicans are pushing this legislation as a chance to permanently reduce the size of government. Yes, the Baby Boomers are crossing the threshold into Medicare eligibility, which has people legitimately concerned about the program’s sustainability. But there are better ways to resolve the problem than hanging vulnerable citizens out to dry and sacrificing our moral backbone.

Any member of Congress who supports this policy risks both significant economic damage to the country and great political peril.

What would increasing the eligibility age do for the deficit? Actually, next to nothing. The Congressional Budget Office’s revised estimate says the policy could save Medicare $19 billion over eight years, if enacted in 2016. This pales in comparison to the whopping $716 billion dollars that Medicare saves over 10 years under the Affordable Care Act.

In fact, raising the eligibility age could plausibly make things worse. Cutting off the youngest Medicare beneficiaries eliminates the program’s healthiest individuals, upsetting the program’s risk pool. Health insurance is predicated on the healthy subsidizing the sick; by dropping coverage of its healthiest participants, Medicare will be forced to charge higher premiums in order to cover care services for aging beneficiaries, who are living longer (and costing more) thanks to new, expensive medicinal breakthroughs.

As a price setter in the healthcare industry, rises in Medicare’s costs will ripple through the entire healthcare industry. As premiums for Medicare increase, so will premiums for private insurance policies. This will accelerate the increase in overall healthcare spending, not just for Medicare – precisely what the United States cannot afford.

None of this will come to pass under the ACA, so Americans can be thankful that the Democrats were first to tackle healthcare reform. But although the reasonable policy and political choice should be clear, Republicans have dug their heels into the ground in protest of anything and everything Obama, threatening to repeal and replace the landmark law with harmful policies like a phased-in age increase.

Like Lucy, conservatives have used smooth-talk to persuade citizens into trusting them with their healthcare interests. The Republican approach remains the same as: let the market operate free of government interference.

That’s right, apparently the market that has denied (affordable) healthcare to millions of Americans and whose industry-wide growth rate outpaces growth in U.S. GDP doesn’t need any help to succeed.

And like Lucy, who benefits from her cruel football ploy, the winners in the current market are hospitals, doctors, and pharmaceutical and medical device companies, all profiting at the expense of the American patient.

Let me remind everyone, especially congressional Republicans, that Obamacare is expected to drive down industry-wide premium costs and save $716 billion in Medicare, all while insuring up to 32 million previously uninsured Americans. Yet Republicans have compared the ACA to the Holocaust, branding it “evil” and “racist.”

As currently constructed, the Republican plan for healthcare and deficit containment imposes costs and cuts on future Medicare beneficiaries, with negative ramifications for the entire healthcare sector. If Congressman John Fleming (R-La.) truly believed that “Obamacare is the most dangerous piece of legislation ever passed in Congress,” I’d like to see him try to pass a policy that is by all measures economically and politically inferior.

Yes, we did do something similar in 1983 by gradually raising the eligibility age for Social Security. But put simply, provision of needed medical services is not as easily suspended as a monthly lump-sum check. Seniors can choose to save money rather than go on vacation. They can’t choose to not suffer a stroke.

To recap the Republican alternative to the ACA: Lost benefits. Higher premiums. More uninsured Americans. These results do not deliver the fiscal “responsibility” that the GOP has always promised – this is fiscal futility leading to loss of credibility.

At a certain point, America’s Charlie Browns will realize that it’s not fun to play with Lucy anymore.

 

 

 

[viii]   Social Security Administration Press Office. “Social Security Fact Sheet: Increase in Retirement Age.” Social Security Online. Social Security Administration. Web. Accessed 12 Sept. 2013. .