Understanding Medicare For All – Part I

 

It is the duty of every American voter to be educated on the issues. As we rapidly approach another election day in November, many Democratic candidates are touting “Medicare For All” as a solution to our failing healthcare system.

Vermont Senator and avowed socialist Bernie Sanders introduced his version of healthcare reform in 2016 when he campaigned for the presidency touting a new single-payer system he calls Medicare For All. Other Democratic candidates have jumped on Bernie’s bandwagon as a growing number of mostly young Americans favor socialism over capitalism.

Today I begin a series of posts to help readers understand what Medicare For All really means to the healthcare of Americans. To assist me in this analysis I will be relying on the excellent work of healthcare economist John C. Goodman.

Ten Things You Need to Know

Goodman gives us ten fundamentals you need to understand about Medicare and what it mean if it were the only healthcare system available to everyone, as Senator Sanders promotes.

  1. Medicare is not really government insurance.

Although Medicare is mostly funded by taxpayers, it is not strictly a government system. It was formed originally by providing a standard benefit package offered by Blue Cross in 1965. It has always been privately administered, mostly by Blue Cross, that continues to provide private insurance to non-seniors. In recent years, one third of all seniors are enrolled in plans offered by private insurers such as Cigna, Humana, and United Healthcare under a cooperative program called Medicare Advantage.

  1. The most successful part of Medicare is run by private insurance.

This refers to the above-mentioned Medicare Advantage program. Studies have found this program delivers higher quality care at less cost than traditional Medicare. (Choice of doctors, however, is more limited.)

  1. Medicare is often the last insurer to adopt innovations that work.

Medicare started prescription drug coverage only after all the private insurers had been doing that for years. It still doesn’t pay for doctor consultations by phone, email, or Skype. It won’t pay for house calls at night or on weekends, even though the cost and the wait times are far below those of emergency rooms.

  1. Medicare has wasted enormous sums on innovations that don’t work.

Medicare has spent billions on pilot programs and demonstration projects trying to find ways of lowering costs and raising the quality of care. Yet instead of finding places in the healthcare system where these techniques work (private Medicare Advantage plans), Medicare set out instead to reinvent the wheel. Medicare frequently has regulations that are counter-intuitive and wasteful, such as requiring patients to be hospitalized before they can receive home physical therapy.

  1. Most seniors in conventional Medicare are participating in stealth privatization, even though they are unaware of it.

There are over 32.7 million patients enrolled in a managed care program called Accountable Care Organizations (ACOs). The Obama administration started this practice without telling seniors they were participating in a grand experiment. Not only that, but it is illegal for an ACO to tell a senior they are enrolled! Furthermore, ACOs are not achieving their intended purpose – they are neither saving money nor are they improving the quality of care.

  1. There is nothing Medicare can do that employers and private insurers can’t do.

For many years the Physicians for a National Health Program argued that a single-payer health insurer would be a single buyer in the market for physicians’ services. They reasoned this would give the government the power to bargain down the fees paid to physicians. Reality, however, is that Medicare doesn’t bargain with anyone. They simply put out a price for services and doctors can either accept or reject it. Private insurers have been doing the same thing for years. This is currently bringing doctor fees down in the ObamaCare exchange market – which is why the best doctors and hospitals avoid these plans.

  1. Medicare for all would be costly.

There is no such thing as a free lunch. This is one of the first lessons of adulthood. Even Bernie Sanders admits this, but only when pressed. A study by Charles Blahous of the Mercatus Center has estimated the cost at $32.6 Trillion over the first ten years. This would necessitate a minimum of a 25% payroll tax – but only if it is assume doctors and hospitals provide the same amount of care they provide today. Since Medicare rates are 40% or more below private rates, a realistic assumption is that doctors and hospitals would increase the amount of care to make up the difference. This would then require at least a 30% payroll tax.

 

(This post will be continued next time.)

 

Vaccination Crisis in Europe

 

Ignorance is bliss – unless it kills you. The ignorance of millions of Europeans concerning vaccines is causing a resurgence of deadly measles once again.

The U.S. Crisis

The United States experienced a similar crisis not so long ago. In 2014, outbreaks of measles in New York City and at California’s Disneyland brought much-needed attention to this problem. Things have improved in this country but they are getting worse in Europe.

The vaccine hysteria can be traced back to misleading research conducted by a British doctor, Andrew Wakefield, and published in the respected medical journal The Lancet in 1998. This research claimed an association between measles vaccines and autism.

The Wakefield research was completely debunked by others and the editor of The Lancet later published an apology describing the original paper as “fatally flawed.” Though Wakefield’s credibility was ruined, his fraudulent research raised up a whole generation of parents who still believe in his findings. Their cause has been inflamed by celebrities such as Playboy model Jenny McCarthy, and her comedian partner Jim Carrey, who have an autistic child. Their emotional appeals to other parents have misinformed many who desperately want to prevent their own children from suffering this debilitating disease.

After the Disneyland scare of 2014, vaccination rates have improved. Stronger laws have been passed to eliminate “loop holes” like “personal choice” or “religious objections” as legitimate excuses for unvaccinated children. Current laws generally require a valid medical reason stipulated by their doctor to avoid vaccination.

The European Crisis

But Europe hasn’t been paying attention. Rising cases of measles in Europe, especially Romania, are sounding alarms.

Pietro Lombardi, writing for The Wall Street Journal, says Romania is fighting a deadly measles outbreak that has seen more than 15,000 people infected with the disease and that has claimed 59 lives since one of Europe’s most lethal measles outbreaks in decades started in 2016. More than 41,000 people were infected with measles in the first half of this year in the wider European region, compared with roughly 24,000 for all of 2017, according to the World Health Organization (WHO).

The problem, once again, is skepticism about vaccine safety. Despite consistent medical evidence that these vaccines are safe, ignorance and misinformation continues to plague attempts to improve rates of vaccination.

This skepticism is made worse in poorer countries like Romania where irregular supplies of vaccine, mistrust of authorities and a vocal antivaccine movement contribute to even lower rates of vaccination.

Lower rates of vaccination deprive countries of the benefits of herd immunity. When vaccination rates are high, those in the community who cannot be vaccinated, because of a demonstrable medical condition, are protected. To establish herd immunity, vaccination rates must be very high – up to 95% or better. In the U.S. at large, the numbers are pretty good, with close to 95% of incoming kindergartners in compliance with vaccine guidelines, according to a 2013 Centers for Disease Control (CDC) survey. But in Romania, the share of 1-year-olds who received the first dose of measles vaccine fell to 86% in 2017, according to WHO.

Just as in this country, liberal orthodoxy has made it difficult to pass legislation to fix this problem. Until cooler, well-informed politicians prevail, Europe will continue to face this crisis in the years ahead.

 

A Tragic Lesson About Socialism

 

For most people with any gray hairs it is a given that socialism is evil. The lessons of the failed governments of Cuba and the Soviet Union are still fresh in our memories.

But for many young people socialism has become the “latest thing.” Recent polls suggest as many as 43% of Americans favor socialism over capitalism – and most of these are young people. Unfortunately, they are being led down this destructive path by an elder statesman, Senator Bernie Sanders of Vermont, and his young acolyte, Alexandria Ocasio-Cortez, Democratic Congressional candidate from New York.

The evils of socialism are being demonstrated in dramatic fashion not far from our southern border in Venezuela. Venezuela is a tragic example how socialism has brought economic disaster and resultant famine and hyperinflation upon a nation with the world’s richest oil reserves!

This dramatic real-world tragedy is playing out in Venezuela while American socialists talk of utopian dreams with their heads firmly planted in the sand. The real story is told by Daniel Pipes, president of the Middle East Forum, in a article published in The Wall Street Journal.

Pipes gives us the background needed to understand just how bad socialism can be. Venezuela discovered vast oil reserves in 1914 that brought the country vast revenues and produced a relatively free economy. By 1950 Venezuela enjoyed the fourth highest per capita income in the world, behind only the U.S., Switzerland, and New Zealand. As late as 1980, it boasted the world’s fastest growing economy in the 20th century.

However, beginning in 1958, government interference in the economy, including price and exchange controls, higher taxes, and restrictions on property rights, led to decades of stagnation. Per capita real income declined 0.13% from 1960-1997, despite their strong oil production.

A Tragic Decline

Pipes tells us the reality of Venezuela today:

“Today the country with the world’s largest oil reserves suffers from a severely contracting economy, runaway inflation, despotism, mass emigration, criminality, disease, hunger and starvation, with circumstances deteriorating daily. Venezuela’s economy contracted by 16% in 2016, 14% last year and a predicted 15% in 2018. Inflation was at 112% in 2015 and 2,800% at the end of last year. Economist Steve Hanke finds an annualized rate of around 65,000% for 2018, making Venezuela’s one of the most severe hyperinflations ever. Food shortages led to an average weight loss among Venezuelans of 18 pounds in 2016 and 24 pounds in 2017.”

 

What caused this crisis?

Socialism. Hugo Chavez convinced Venezuelans to try it in 1999, then stole, dominated, polarized and jailed anyone who disagreed. With about a $1 trillion in oil sales during his 14 years as president, he had the means to launch massive social spending programs to secure votes to strengthen his control. Then he replaced oil professionals with his agents, stooges, and sycophants further consolidating control.

As former British Prime Minister Margaret Thatcher once said, “The trouble with socialism is that eventually you run out of other people’s money.”

Hugo Chavez didn’t reach that situation because he died in 2013, about a year before oil prices tumbled, when he sought cancer treatment in Cuba and was “assassinated by Cuban malpractice” according to Fox News reports. However, his successor, Nicolas Maduro, has proven even more brutal and incompetent. The result of Maduro’s handling of the economy is the disaster chronicled above.

The lesson of the evils of socialism could not be clearer for the world today. It is the job of our national media, and all clear-thinking Americans, to educate people to the tragedy playing out not far from our southern beaches. It’s time our young people stopped listening to the sirens of socialism and got in touch with reality.