The Future of Medicare Is the Future of Health Care

By Trudy Lieberman, Columbia Journalism Review. Posted January 11, 2008.

Of the millions of words written and spoken about U.S. health care, only a tiny percentage have been about Medicare. So far, stump speeches and media coverage boil down, on the Democratic side, to whose health proposal covers more people, and, for GOP candidates, who will not embrace that American bugaboo, "socialized medicine." Medicare, which covers more than forty million seniors and people with disabilities, seems to be off limits, even though there's plenty to talk about. The scant coverage of Medicare that does exist is cryptic, code-like, and assumes that the public knows the ins and outs of one of the government's most complicated programs.


This is unfortunate because the future of Medicare may well tell us what kind of health care all of America will eventually have. Will we conquer budget challenges and find a way to continue Medicare as a successful social insurance program? Or will we privatize the program to mirror the rest of the U.S. health insurance system, with its holes and shortcomings?


A New York Times CBS News poll in December found that less than one percent of respondents thought Medicare and Medicaid were the most important problems facing the country, a stat which raises a chicken and egg question. Do candidates think that people don't care about Medicare, justifying their silence, or do voters not yet care because the media (and the candidates) aren't telling them what's at stake?

Back in August, Hillary Clinton gave a speech in Iowa and briefly discussed Medicare, which she said faced significant financial challenges driven by the spiraling cost of health care. True enough. She told the gathering that the current president had not called for a national commitment to save Social Security and Medicare and that it was time "we talked about and confronted a lot of these issues." She described them as "invisible." True again. But neither Clinton, the other candidates, nor the media have done much to make them visible.

Mike Huckabee's words are puzzling. Right before Christmas, Huckabee talked to an Iowa woman who is dying from a progressive lung disease. When she asked him what he would do to change the national health care system, he responded that change must start with federal programs like Medicare and Medicaid. "If we don't set the model, then the rest of the industry doesn't move that way." But if Huckabee explained what model he had in mind, The Associated Press didn't tell us.

On the trail, Huckabee notes that Medicare obligations, if not "fixed," will lead to financial ruin, and quips, "Wait till all these aging hippies find out they'll get free drugs for the rest of their lives." Does he mean free LSD or free Lipitor? Medicare provides neither, but aging hippies might indeed want to know what kind of program Medicare will be five years from now -- one where everyone is entitled to a standard set of benefits or one where people must fish in the pond controlled by private insurance companies. The Medicare drug benefits, now sold by commerical insurers, moved in the latter direction.

Fred Thompson said he would cut Medicare for wealthy people like Warren Buffet. Does he really mean billionaires, or merely those with incomes higher than $80,000? (Right now single people with incomes greater than that pay higher premiums -- another step in the direction of privatization.) Does Thompson aim to destroy the universality of Medicare, which most experts believe contributes to the program's popularity and success? A Miami Herald story into this for readers, many of whom are already on Medicare and would presumbly want to know if they will lose benefits under a Thompson plan.

John Edwards started to talk about how the drug companies wrote the Medicare prescription drug law. "Why do we have that mess of a Medicare prescription drug law? The thing was written by drug company lobbyists. I was there..." A New York Times story cut off the rest of his remarks so we don't know, if he said anything, about how he would fight drug company opposition to negotiating prices with Medicare, a position he supports.

The media and the candidates are ignoring other serious issues:

Overpayments to insurance companies selling private-fee-for-service plans to Medicare beneficiaries. Seniors can choose one of these plans instead of traditional Medicare benefits. But independent experts like the Medicare Payment Advisory Commission say the government pays these insurers 19 percent more than it costs to provide the same benefits under traditional Medicare. Medicare's own actuaries predict that overpayments hasten the depletion of the system's trust funds, resulting in benefit cuts unless new revenues flow in. When President Bush vowed to veto any legislation that cut the excess payments, Congress didn't push for cuts during its end-of-the-year session. The media missed a golden opportunity to press the candidates. For the record: Both Obama and Clinton supported cutting the overpayments, important positions that have gotten no attention or traction so far.

How Medicare will cope with the rising cost of health care, and who will pay those costs. Medicare like other segments of the health care system has been unable to control the mounting costs of new technology and treatments. To continue benefits, tax increases might be necessary. Yet the snippets of Medicare policy we have heard come mostly from Republicans promoting market solutions -- like shifting future costs to beneficiaries -- instead of revenue solutions that will retain Medicare's fundamental structure. Clinton said almost a year ago that the president's attempt to make higher-income beneficiaries pay surcharges for their Medicare drug benefits was "exactly the wrong approach." But as the year unfolded, squabbles over whose health care plan forced more people to buy insurance drowned out this crucial policy difference.

A recent retirement column posted on businessweek.com/investing questioned the silence about Medicare and other retirement issues. The writer, Ellen Hoffman, scanned position papers, statements, and tried, sometimes without success, to get more information from campaign staffs. It's a hopeful sign that she tried. Maybe other reporters will start delving in to the effects of government overpayments and rising health care costs on Medicare, and whether Medicare will continue to cover all of the elderly. Here's a case where the press needs to lead rather than wait for the spinmeisters to decide what gets covered.

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