The Republican plan to privatize Medicare by replacing it with a voucher system would reduce the skyrocketing cost of medical care. No other program has been able to accomplish this. And the most basic reason is very simple. Nobody shops around for a cheaper fire hose during a fire. When people get sick, they tend not to put a lot of priority on looking for the cheapest care. So medical costs have gone up for pretty much everyone. Seniors are hardest hit.
It is true that Obamacare would reduce medical costs. Some of it involves indisputable common sense steps: reducing run-away fraud, slashing paperwork, and forcing insurance companies to compete in regional groups with clear, standard, easier to understand information. There hasn't been that much corporate incentive to move into the modern world, and the medical industry has become a hybrid of advanced technology and 1930s structure. In fact the non-partisan Congressional Budget Office calculates a dramatic reduction in Federal deficits through Obamacare. The CBO does have reservations about whether Congress will actually follow through on some of the implementation of Affordable Care. Some conservatives have falsely claimed that these reservations mean the savings won't happen, but this is untrue.
Still, Republicans believe individual effort provides a better way. The GOP proposal passed by the House of Representatives will give seniors an incentive to shop around, even during medical emergencies, by substituting privatized vouchers for the current defined benefit system. Faced with supplementing medical care with their own finances, seniors would be motivated to look more carefully for cheaper medical treatment, or to forego it completely if costs get too far ahead of vouchers.
But Republicans are also planning on instituting another cost cutting measure. They intend to increase the age at which potential recipients can receive medical care. It would go up to age 67. This will give seniors an additional incentive to continue working in order to receive group coverage a little longer. Putting off retirement can also reduce payments of Social Security benefits, a double savings.
But those who are unable to continue working will be harder hit by medical expense. And the cost to employers can be expected to shoot up as group insurance coverage is applied to older employees. One careful estimate is that employers will pay about 16% more to insure the older pool, and that those workers who bite the bullet and retire anyway will pay 2 to 4 times more for each year without coverage. It's only 2 years difference, but it is a vulnerable time medically.
There is some logic to Republican efforts. The retirement age of 65 is traditional, but the origin is shrouded in myth. One story has it that ancient knights were thought to be unable to bear the weight of their armor when they approached age 65. Actual data seems to show that retirement was not a factor in working life until fairly recently in history. Railroads made age 70 the mandatory age in the 1930s. New York made judges retire at age 60 a few decades before that. The rise of income and a depression era desire to reduce the labor pool to give younger worker a better chance to find employment was a major impetus. Unemployment is nowhere near what it was in Depression days so, the reasoning goes, it is as good a time as any to nudge older folks into working a couple of years longer.
Republicans say they will not increase the age of retirement all at once. A few months a year rise in the age of eligibility for Medicare will happen over time, and eventually stop when eligibility gets to age 67. Further increases in age will depend on finances and conditions at the time. There are other priorities that must be weighed against medical needs of the elderly. Among the most controversial are federal subsidies for oil corporations and tax cuts for the extremely wealthy.
The accusation by Democrats that Republicans have no plan to reduce healthcare costs is not entirely true, at least in theory. Raising the age of eligibility and replacing the current system of health care for seniors with a reduced substitute voucher plan is thought to provide plenty of incentive for older Americans to reduce costs on their own.
The operative phrase here is "on their own."
I think one of the major reasons seniors don't shop around is because it's just too damn confusing. There are sooooo many ins and outs and ups and downs and ariables when it comes to health care, it can be a bit too much to deal with, not just for seniors, but for everyone.
I've said it before and I'll say it once more: it is insane to introduce profit motive into something as important as health care. It is ludicrous to have an outside private source pay your medical bills for you and then charge you their profit and administrative and advertising costs on top of it too.
Bring on universal Medicare for EVERYONE , NOW, like they have in most other more civilized countries!
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