The Unaffordable System

The country can no longer afford to pay for retired persons’ healthcare insurance. 

This is what we are being told.  The GOP’s budget that was passed in the House looks to change the system of Medicare.  It changes it in that it eliminates it.  Today, the government collects taxes (think of these as premiums) and then acts as the single insurance company to pay for all claims for services doctors and hospitals provide to retired persons.  There is an agreement between the government and the public about what services will be covered.  There is an agreement between the government and the providers about how much will be paid for each service.

The problem is that the cost of medical care is going up faster than the premiums that must pay for it.  

The GOP’s plan to solve this problem is to turn the insurance responsibility over to private companies, provide a subsidy to them for part of the premiums, and cap the level of the subsidy to rise only with the overall level of inflation.

Now, there are two big problems with this approach.  1) The inflation on medical care is rising far faster than the overall inflation rate.  2) Whereas today the government puts nearly ever premium dollar towards paying claims, private insurers will have far greater overhead – today this overhead averages about 30%.  This means that 30 cents of every 1 dollar will not pay for actual care, but instead pay for marketing, profit, and other non-care related items.

The GOP plan does nothing to control the cost of medical care for seniors.  It only controls the government’s cost by shifting the additional expenses to seniors who will pay it in ever rising premiums to private insurers.

The real solution to the high cost of medical care is to change the system by which medical care is delivered, not the system by which it is paid for.  Our country must change the way in which private enterprise operates in the delivery of medical services. 

You see, we get to decide the way the medical system is organized and operates in the US.  When the system does not operate in a way that servers the citizens of our country, it is our responsible and right to change it.  Nowhere is it required that we allow 30% of every dollar to go to profits, marketing, and other overhead in the private sector when it is not in the best interests of our entire population.  The answer to the affordability of medical care for seniors, and everyone else, is not to make each person pay more, it is to change the rules of the game, and the way the game is played to remove unneeded costs.

You see, the unaffordable system is not Medicare, it is the healthcare delivery system itself.  There is no place for profit in it and it should be removed.