FacebookTwitterGoogle+RedditEmail

Medicare Buy-In

Back in the good old days the conservatives were the folks who favored individual choice: not any more. In the current health care debate, the top priority of the so-called conservatives is to deny people choice. They want to make sure that Americans do not have the option to buy into a Medicare-type public health care plan. These alleged conservatives have come up with a variety of arguments against allowing people the Medicare-type option, but the only one that makes sense is that they work for the insurance industry.

The argument against a Medicare-type option always begins with the assertion that the government can’t do anything. This is a peculiar claim given the popularity of Medicare, but it also makes no sense as an argument against giving people a buy-in option. Suppose the government gives people the option to buy into its really bad plan. Everyone would just stick with the good private plans we have now, right?

The so-called conservatives then tell us that people will end up buying into the bad Medicare-type plan instead of the good private insurance options because the government will subsidize the Medicare-type plan. A little bit of arithmetic is sufficient to dismiss this argument.

How much money would be needed to get people to choose a bad health care plan rather than a good one? This would have to involve some serious subsidies; people are not going to sacrifice their health and the health of their families for another cup of coffee at Starbucks.

Suppose it took a subsidy of $1,000 a year to get people to choose the bad Medicare-type plan over the good private sector plans. With a non-Medicare population of more than 250 million, this would imply government subsidies of more than $250 billion a year, if the Medicare-type plan was to fully replace private sector plans, as the so-called conservatives warn.

Is it really plausible that Congress will approve $250 billion a year in subsidies ($2.5 trillion over a 10-year budget window) for a Medicare-type plan that everyone thinks is awful? Is there another altogether wasteful program that gets public subsidies even one-tenth of this size?

This one just doesn’t pass the laugh test. If conservative politicians don’t think they can prevent such an enormous waste of taxpayer dollars being perpetuated year after year for the indefinite future, they should probably consider another line of work.

In short, there is no genuine conservative argument against allowing people the option of buying into a Medicare-type plan. If the plan proves to be inferior to private insurance plans, as is often argued, then the consequences will be relatively minor. Some number of people who choose to sign up with this plan will find that they don’t like it, and then will switch to a better alternative. In time, a bad public plan will soon flounder, since few people will buy into it. There may be some effort to provide subsidies to even a bad public plan, but it is not plausible that the subsidies could be large enough to displace private plans.

It is also clear that the opposition to a Medicare-type public plan does not stem from townhall-type mass based opposition. A recent New York Times poll found that by an overwhelming majority, 65 percent to 26 percent, the public favors giving people this option. If there is a member of Congress that risks defeat by supporting a public plan, it is not because of their constituents’ views.

The opposition to a Medicare-type option is not based on public sentiment or the fear that the plan will be bad. Rather the opposition is based on the fear that the plan will be good and that people will choose to buy into it. This will cost the insurance industry tens of billions of dollars in profit over the next decade and could mean the end of big paychecks for the industry’s CEO’s and other high-level executives.

But the people who oppose giving the public the opportunity to buy into a Medicare-type plan should not be called conservatives. Honest conservatives would have no objection to giving the public a choice. The people who oppose a Medicare-type plan are doing the bidding of the insurance industry – there is no conservative principle at stake. And we all know what Joe Wilson has to say about people like that.

DEAN BAKER is the co-director of the Center for Economic and Policy Research (CEPR). He is the author of Plunder and Blunder: The Rise and Fall of the Bubble Economy.

More articles by:

Dean Baker is a macroeconomist and co-director of the Center for Economic and Policy Research in Washington, DC. He previously worked as a senior economist at the Economic Policy Institute and an assistant professor at Bucknell University.

July 23, 2018
Pam Martens
Koch Industries Is Staffing Up with Voter Data Scientists to Tip the November Election to the Extreme Right
Binoy Kampmark
Ecuador’s Agenda: Squeezing and Surrendering Assange
Vijay Prashad
America’s Reporter: the Hersh Method
Colin Jenkins
Exposing the American Okie-Doke
Patrick Cockburn
What Boris Johnson Doesn’t Know About British History
Jack Random
Asylum Seekers in the 21st Century
Howard Lisnoff
How We Got Sold on Endless Wars
Ed Meek
Trump Has Taught Us Some Valuable Lessons About Executive Power
Myles Hoenig
Trump, the Mr. Magoo of American Diplomacy
Winslow Myers
The Mind Reels
Thomas Mountain
Ethiopia’s Peaceful Revolution
Weekend Edition
July 20, 2018
Friday - Sunday
Paul Atwood
Peace or Armageddon: Take Your Pick
Paul Street
No Liberal Rallies Yet for the Children of Yemen
Nick Pemberton
The Bipartisan War on Central and South American Women
Jeffrey St. Clair
Roaming Charges: Are You Putin Me On?
Andrew Levine
Sovereignty: What Is It Good For? 
Brian Cloughley
The Trump/NATO Debacle and the Profit Motive
David Rosen
Trump’s Supreme Pick Escalates America’s War on Sex 
Melvin Goodman
Montenegro and the “Manchurian Candidate”
Salvador Rangel
“These Are Not Our Kids”: The Racial Capitalism of Caging Children at the Border
Matthew Stevenson
Going Home Again to Trump’s America
Louis Proyect
Jeremy Corbyn, Bernie Sanders and the Dilemmas of the Left
Patrick Cockburn
Iraqi Protests: “Bad Government, Bad Roads, Bad Weather, Bad People”
Robert Fantina
Has It Really Come to This?
Russell Mokhiber
Kristin Lawless on the Corporate Takeover of the American Kitchen
John W. Whitehead
It’s All Fake: Reality TV That Masquerades as American Politics
Patrick Bobilin
In Your Period Piece, I Would be the Help
Ramzy Baroud
The Massacre of Inn Din: How Rohingya Are Lynched and Held Responsible
Robert Fisk
How Weapons Made in Bosnia Fueled Syria’s Bleak Civil War
Gary Leupp
Trump’s Helsinki Press Conference and Public Disgrace
Josh Hoxie
Our Missing $10 Trillion
Martha Rosenberg
Pharma “Screening” Is a Ploy to Seize More Patients
Basav Sen
Brett Kavanaugh Would be a Disaster for the Climate
David Lau
The Origins of Local AFT 4400: a Profile of Julie Olsen Edwards
Rohullah Naderi
The Elusive Pursuit of Peace by Afghanistan
Binoy Kampmark
Shaking Establishments: The Ocasio-Cortez Effect
John Laforge
18 Protesters Cut Into German Air Base to Protest US Nuclear Weapons Deployment
Christopher Brauchli
Trump and the Swedish Question
Chia-Chia Wang
Local Police Shouldn’t Collaborate With ICE
Paul Lyons
YouTube’s Content ID – A Case Study
Jill Richardson
Soon You Won’t be Able to Use Food Stamps at Farmers’ Markets, But That’s Not the Half of It
Kevin MacKay
Climate Change is Proving Worse Than We Imagined, So Why Aren’t We Confronting its Root Cause?
Thomas Knapp
Elections: More than Half of Americans Believe Fairy Tales are Real
Ralph Nader
Warner Slack—Doctor for the People Forever
Lee Ballinger
Soccer, Baseball and Immigration
FacebookTwitterGoogle+RedditEmail