While I’m displeased to see demagoguery of Medicare reform paying political dividends yet again, I await with glee the eventual collapse of the entire system due to voters’ unwillingness to countenance even small, timid reforms that would help save it.
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PILEUS 
Jason, you’re one of my idols, but I feel obligated to rebuke you here. I don’t think we should await the collapse of the system with glee (although we might perhaps await it with hopes that, in its ashes, we can establish a utopia of individual liberty). The reason I say this is because I thought exactly as you do until I picked up “Understanding the Dollar Crisis” by Percy L. Greaves, in which Greaves explains how, when political systems collapse, everybody loses (he uses the example of the Jews, who profited from the fall of the Weimar currency, but were scapegoated for it pretty badly).
Of course, I hope to be totally wrong, but I am not excited for political instability. More often than not, it results in MORE government.
Yes, tongue was firmly planted in cheek here. However, I think it’s more likely that Medicare will not ultimately collapse, but instead be reformed on more radical lines than has yet been proposed when its insolvency threatens the entire budget.
I’m not so sanguine, Jason. I have a sneaking dread suspicion that we will continue to pretend nothing is required until there is in fact some kind of collapse. I hope I am wrong, but recent, and not-so-recent, history suggests to me I am not.
Blaming this defeat on demagoguery might make you feel better, but it ignores why this reliably Republican district rejected the Ryan plan on Medicare. Only nine Congressional districts in the entire US are more Republican than NY-26.
It is always going to be tough to get voters to modify government programs which provide them direct benefits. Appeals to deficit reduction won’t overcome this problem alone. There has to be some upside for the voter.
The argument for the privatization of Social Security could make a very cogent argument that retirement funds invested in equities have consistently done much better than the returns offered by the government programs. There was a plausible upside for voters to support privatization.
Vouchers for primary education can also be explained as an upside to the public since American private schools have often had lower costs and better outcomes than public schools. Again – there is no such track record for private insurance in the US.
The Ryan plan has no argument on the upside of privatization of Medicare since there are no examples of “private insurance” in the US being able to stem the consistent increase in healthcare costs.
Why do healthcare costs continue to rise faster than inflation in the US? Why hasn’t private insurance done any better than public programs such as Medicare? I’m sure that 99% of the readers of this blog would agree that a big part of the answer is the agency effect and the system of perverse incentives built into the system. All of those problems continue to exist in the Ryan plan. Voters may not understand the “agency effect”, but they know that Ryan is not offering any solutions to a very real problem.
I live right next to the district. 10th most Republican district in the country doesn’t sound right. It’s an ideologically moderate district with lots of elderly people and a very large, left-leaning university community. Definitely leans GOP, but not like Idaho, Wyoming, parts of Texas, Mississippi, etc.
Currently Medicare is essentially a blank check for recipients. Of course they over-use it. Government’s monopsony power allows them to keep reimbursement rates fairly low, but providers simply pass on the costs to other consumers.
We don’t have that much of a health insurance problem in this country. We have a health care cost problem. Health insurance profits are normal. The reason health insurance is expensive is that health care is expensive (plus insurance mandates, which Ryan’s plan admittedly would not solve – its major failing). Why is health care expensive? The third-party payment systems represented by Medicare, Medicaid, and gold-plated, employer-provided private insurance plans that are essentially subsidized by the federal tax system encourage overuse.
The Ryan plan’s virtue is that it would at least begin to solve the problem of overuse by encouraging Medicare recipients to be a bit more cost-conscious. Future recipients are going to worse off because the Ryan plan was not adopted – they are going to face massive, direct benefit cuts.
I’ll defer to your knowledge of NY Politics.
But on Medicare, it has not been a 100% coverage system in a long time. Having seniors pay slightly more for their coverage has done nothing to slow down the increases in costs. Even most of the gold-plated, employer-provide systems now have a multitude of deductibles, co-pays, in-network service, etc. Has that slowed the increases down?
Butyour comments just prove my point: no current public or private insurance program has helped stem cost increases. Unlike the debate over Social Security, it is not possible to point to an example where privatization might make an individual better off.
Of course we will all be better off if the system doesn’t go broke, but right now all that the Ryan plan offers to voters is rationing of care. That’s pretty hard to sell.
I would argue that not nearly enough has been done. I hardly have “gold-plated” insurance, but I only pay $20 for visiting the doctor and $60 for going to the ER. In my view, the patient should pay essentially 100% of the cost of going to the doctor for a routine visit.
The Ryan plan offers a modicum of price mechanism into the Medicare system. The standard solution to Medicare for libgressive types, to the extent they acknowledge a problem at all, really is rationing – having a central panel decide what counts as necessary care. So either way, there are going to be cuts; the only question is how deep they are and how much choice patients will continue to be permitted.
If you only pay $60 for an ER visit, you have a gold-plated insurance program. The plan I have might not be a Cadillac, but it’s close, and I pay a $125 co-pay. With a son in football and lacrosse, I’m glad it’s not more.
Well, I am a unionized state employee after all. 😛 I know that it is harder for us to get authorization for MRIs than it is for Medicare & Medicaid patients. At least, that’s what our doctors have told us.
I, like Jason and Richard, have an insurance plan with limited cost to me per event. In my view, this limited personal expense, for a basic visit, for an MRI, for a trip to the ER, and so forth, is at the heart of the problem. The end consumer feels no immediate, direct financial impact for the decision to make the visit or perform the test. In a sense, there is no cost, which creates a false demand. Add to that the litigious nature of medicine, and the related medical practitioner’s inclination to CYA, and that false demand spirals. Until we form a direct relationship between the service provided to the end consumer (the patient) and direct and immediate cost related to the consumer’s choice, prices will continue to escalate abnormally.