Let's End This Talk Of Medicare Going Broke
Some politicians are saying that Medicare is going broke and is unsustainable in its present form. That may be true without any changes in Medicare and Medicare funding. But Medicare will go broke only if we allow it to go broke. First, anyone should think logically who Medicare insures. Medicare insures the oldest and sickest while Medicaid insures the poorest Americans. Medicare covers every American over age 65 and who has been on disability at least two years who has enough credits through social security. You build those credits by working or having some connection to the work force. I ask, would any private health insurance company insure the people insured by Medicare? Of course not, they would lose their shirts, or premiums would be so ridiculously high that only someone like Donald Trump could afford to be insured.
The problem with Medicare's funding is that a major source of funding for Medicare, the Medicare tax has been stuck at the same rate since it became effective in 1986. That Medicare tax is 1.45% of income, matched by the employer for a total of 2.90% of income. We would not be having this discussion if health care costs would have increased at the same rate as incomes since 1986. But everyone knows that health care costs have increased more than three times faster than incomes since 1986.
Any private health insurance company would have gone out of business long ago if they had not increased their premium rates to keep up with the cost of health care, so why not Medicare? The problem is that increasing the Medicare tax rate requires an act of Congress and Congress just hasn't mustered the courage to increase the Medicare tax rate to keep it in line with what Medicare pays for - health care. It is a shame that some irresponsible politicians would rather see the program go belly up than see people paying more to keep it alive and solvent into the 21st century.
Here is a radical idea. How about expanding the Medicare risk pool to include every American, the young and healthy as well as the old and sick? By expanding Medicare to include everyone, especially the young and healthy, the risk pool is also expanded to include everyone in the nation.
Medicare is not like Canada's single payer system. It does not pay for everything and carries high deductibles and co-payments. There is also a premium for part B which pays for medical expenses that are over $115 for people new to Medicare in 2011. Everyone is paying part of the cost and everyone is covered. In addition, Medicare's deductibles and co-payments have generated a vibrant market in private Medicare supplement policies and Medicare Advantage plans. Therefore, private health insurance would not go out of business under a Medicare for everyone plan.
It is time for the United States to realize that we have had a great health insurance system for more than 45 years. It is time to embrace the rest of the developed world and expand Medicare for every citizen. After all, the program has been around for 45 years insuring the oldest and sickest people in the country. Now is the time to make it work for every citizen.
Lee Kamps
Lee has been working with Medicare, Medicaid and private health insurance since he began working at the Erie County Welfare Department in January 1973 where a major part of his job was determining eligibility for Medicaid. He went into the private insurance business in 1977 with Prudential Insurance Company and within a short time had become one of the company’s top sales agents. In 1982, he was promoted into management where he managed two field offices and as many as thirteen sales agents. After leaving Prudential in 1986, Lee decided to become more focused on health insurance and employee benefits. He has advised many local employers on how to have a more cost effective employee benefit program as well as conducted employee benefit meetings and enrollments for many area employers. The companies Lee has worked with ranged from small “mom and pop” businesses to local operations of large national companies. Lee received his B.S. degree from Kent State University where he has been active in the local alumni association. He has completed seven of the ten courses toward the Certified Employee Benefit Specialist designation. He has taught courses in employee benefits and insurance at Cleveland State University and local community colleges. In addition, Lee is an experienced and accomplished public speaker. He has been a member of Toastmasters International where he achieved the designation of “Able Toastmaster – Silver” in 1994. He has also served as a club president, Area Governor and District Public Relations Officer in Toastmasters as well as winning local speech contests. Lee has also been a member of the Greater Cleveland Growth Association’s Speaker’s Bureau where he was designated as one of the “official spokespeople for the Rock and Roll Hall of Fame” prior to the hall’s opening in 1995. He has given talks and presentations before many audiences including civic organizations, AARP chapters and many other community groups. With the implementation of the Medicare Modernization Act (Medicare drug bill) in 2006, Lee has shifted his focus to Medicare and helping Medicare beneficiaries navigate the often confusing array of choices and plans available. As an independent representative, Lee is not bound to any one specific company or plan, but he can offer a plan that suits an individual person’s needs and budget. In addition, Lee is well versed in the requirements and availability of various programs for assistance with Medicare part D as well as Medicaid. While he cannot make one eligible, he can assist in the process and steer one to where they may be able to receive assistance.