Why Are Republicans Opposing Medicare Cost Controls?
Democrats are proposing to control future Medicare costs, and Republicans are trying to stop them. Who knew?
This could have been the perfect “Nixon in China” moment. Democrats—who created Medicare and for decades resisted GOP moves to curb the program—control Congress and the White House. A Democratic President has embraced modest efforts to slow the program’s unsustainable rate of growth. Drug makers, doctors, and hospitals all swallow hard and buy into the idea. It could be the perfect moment for a bit of desperately needed fiscal responsibility.
And what happens? Republicans, who only months ago tried to turn Medicare from an entitlement into a voucher, are lined up against slowing the program’s growth. They offer amendments in the Senate Finance Committee to “protect our seniors.” GOP Party Chairman Michael Steele writes a manifesto acknowledging that the long-term growth rate of Medicare is a problem, but insisting that Republicans will go to the barricades to save the elderly from the ravages of Obama-care.
As this depressingly familiar graph shows, the current pace of Medicare spending is not only unsustainable in the long-run, it is politically impossible.
By mid-century, Washington will be spending nearly 10 percent of Gross Domestic Product on Medicare but, without major policy changes, collecting only about 20 percent of GDP in revenues. That leaves only 10 percent of GDP for Social Security, Medicaid, interest on the debt, national defense, and everything else government does. And lawmakers will face two equally unpalatable choices: Slash all that other spending by more than half, or raise taxes to dangerously high levels.
What looks increasingly like a missed opportunity to address this looming disaster is no surprise, given the toxic political climate here in Washington. And not too many years ago, Democrats did the same thing to George Bush, who tried to get a handle on Social Security. Dems were happily wringing their hands over massive Bush-era deficits but, given an opportunity to do something about it, chose the partisan low road.
Now, the Republicans are taking their turn at irresponsibility. Having lost control of the purse strings, they are howling about the debt we will leave our grandchildren. Yet, given the chance to make the smallest dent in Medicare’s growth rate, they suddenly have become the protectors of seniors. I half expect them to propose naming the Capitol after Claude Pepper.
Imagine for just a moment an alternate universe: Democrats and Republicans set aside their squabbling and agree to eliminate wasteful or even dangerous Medicare spending. This, however, would require lawmakers to act like adults and explain that more health care is not the same as better care, and that Medicare growth could be slowed without jeopardizing the health of seniors.
But that isn’t likely to happen. Democrats and Republicans can agree to hand out Medicare dollars they don’t have, as they did with the Part D drug benefit. But when it comes to controlling costs, partisan name calling is so much more fun
A straight line trend is a bit alarmist, given the past pattern of spending. There will be more peaks and valleys.
If we really want Medicare to be solvent, the only way to do that is to expand the economy – which means more immigrants and more children (with taxpayer support of large families). Of course, more children may come about even without tax reform, which is why such long term predictions are misleading.
Everybody knows that the root cause of the cost explosion in health care is that patients don't know or care what anything costs. THAT is what must change. Current reform plans don't change it. Progressives don't WANT people to make health care decisions based on cost, but in the long run there is no other viable option.
It would be more accurate to call current reform proposals anti-reform, because they double down on a losing bet against market forces in health care. The only way out is a system that gives patients a large financial stake in saving money by avoiding expensive procedures. It's highly unpleasant to contemplate, but we may need to consider tax credits for foregoing expensive treatment (e.g., pulling the plug on granny) so that society can afford to treat more needy patients.
Inevitably, the rich will get better health care than the poor. If the rich got that way by providing more value to society, this result could be viewed as fair. Fair or not, we need to get used to this, because society cannot afford to continue the fantasy that everyone can have unlimited cheap access to state of the art health care.
True reform MUST involve patients financially in cost/benefit decisions, making patients the watchdogs on price and quality, just as they are in every other service they purchase. This is the single most important aspect of health care reform. For this reason, the current proposals deserve to be defeated.
Your piece is internally inconsistent, and illogical. On the one hand you decry Democrats and Republicans for “hand[ing] out Medicare dollars they don’t have, as they did with the Part D drug benefit,” and then turn around and criticize Republicans for oppsing Democrats' efforts to do the same thing in their health bill. You seem to be ignoring one of the central pieces of the debate: none of these cuts to Medicare are “savings,” they're offsets to “pay for” new health insurance subsidies, which will do nothing to shore up the long-term imbalance in the federal budget.
Is it inconsistent for Republicans to pretend that Medicare is sacrosanct, and they want to preserve it as is? Yes. Is it good policy? No. Is it good politics? Yes. You can't fault them from learning from Democrats who rile up seniors anytime anyone even suggests that a program with a $36 trillion unfunded liability in Part A alone may have excess benefit growth.