Having endured the past year of the Presidential campaign — most recently the Obama v. Romney debate — in which Medicare is characterized as the program that will send the United States into bankruptcy, I realize that the question must be asked: why not end it?
It is a bold notion — one discussed privately in some circles but rarely mentioned in public. Is it truly unthinkable?
The political discussions of health care center on cost: reimbursement rates, premium support vouchers, and the like. These rest on the notion that if one squeezes the financial viability of supply hard enough, demand will shrink. For example, doctors will not order unnecessary tests if they are not reimbursed for them and, even if they do, cost-conscious patients will refuse to take them.
Never mind, for a moment, that the emerging field of behavioral economics has debunked much of such rational actor thinking when it comes to financial and health decisions. We are far more complex than these linear models suggest.
Let us consider instead shrinking demand. Decreasing the demand for health care — because people are healthy, not because they lack access or resources for care — is the ultimate long-term solution to lowering health care costs.
An enormous amount of our health care expenditures are directed toward treating chronic conditions such as obesity, heart disease, high blood pressure, asthma, and the like. While the private health care industry makes efforts at reducing the incidence of these conditions, the rates of occurrence continue to increase.
What does this have to do with eliminating Medicare?
The Affordable Care Act was enacted to close one fissure in the system: between those who have insurance and those who do not. The rationale, quite sensible, is that costs can only come down and outcomes improve when everyone is in the same system. One other significant cleft is between those in Medicare and those in the private system. Every private insurance company knows that its customers will migrate to a public program, Medicare, as soon as they turn 65 — entering their most health care intensive years. In stark terms, the private sector gets the net profit years while the public sector gets the net loss years. This is, in part, why Medicare is financially unsustainable.
If, as in the German system, insurers had to cover their customers until death there would be a much stronger incentive to promote health when these people are younger. Creating healthy behaviors early in life can lead to better quality of life. It also fosters a different mindset toward health care decisions. Clinicians become partners in health, not just people to see when you are sick. There would be better continuity and coordination of care throughout a person’s lifetime.
This approach also advances a a fundamentally different and improved relationship between payers, providers, and patients — and between the health care industry and the public. This aligned community could become a nexus for health with the heft to draw in the food and agricultural sectors and others whose activities have a direct impact on health.
Would not insurance premiums skyrocket under this model? Perhaps. It would be interesting to see how the private market prices lifetime coverage. If insurance costs did go through the roof, it would focus attention on the difficult choices about cost and care that we are largely avoiding in the current debate.
Of course there are other ways to achieve this lifetime approach to health insurance. The Medicare-for-all public option that was rejected in the run up to the Affordable Care Act embodies this same idea in a public sector-centric way. Every other developed country has found a way to provide health care to its citizens — with lower costs and generally better outcomes. We insist on developing our own model. If we are to renegotiate a model that is socially and economically viable given our aging and increasingly unhealthy and unwealthy population, we have to put all of the options on the table.
Sometimes the best way to stimulate bold, innovative thinking is to articulate an outrageous proposition. So, is it time to ditch Medicare?