Going for Broke.

[dwer.livejournal.com]

In yesterday's debate, moderator Martha Raddatz said:

"Let's talk about Medicare and entitlements. Both Medicare and Social Security are going broke and taking a larger share of the budget in the process."

"Will benefits for Americans under these programs have to change for the programs to survive?"

And Paul Ryan responded with:

"Absolutely. Medicare and Social Security are going bankrupt. These are indisputable facts."

Wellllllll... not so much.

SSI is not going broke, as David Cay Johnson says:

Which federal program took in more than it spent last year, added $95 billion to its surplus and lifted 20 million Americans of all ages out of poverty ()?

Why, Social Security, of course, which ended 2011 with a $2.7 trillion surplus.

That surplus is almost twice the $1.4 trillion collected in personal and corporate income taxes last year. And it is projected to go on growing until 2021, the year the youngest Baby Boomers turn 67 and qualify for full old-age benefits.

And Medicare going bankrupt? Not so fast, says the Columbia Journalism Review:

First, CNN reported, as CJR has urged news outlets to do, that only one part of Medicare is in potential trouble—the Hospital Trust Fund, which is financed by payroll taxes. The other parts of Medicare, including Part B, which finances doctor visits, lab tests, and outpatient services, “are adequately financed for now,” Medicare trustees have said. CNN made that clear to readers.

CNN pushed further and asked a logical question that most reporters writing about Medicare have missed. When the magic date for “bankruptcy” arrives—2024 according to the Dems, or 2016 if the ACA disappears in a Romney presidency—would Medicare really disappear? Jonathan Oberlander, a health policy expert at the University of North Carolina, told CNN that repealing the health reform law “would in fact worsen Medicare’s financial condition,” but even so, he added, “Medicare is not going bankrupt. Medicare would still have most of the necessary funds to pay those expenses and other parts of the program would be unaffected. Medicare won’t go bankrupt in the literal sense in 2016 or 2024 or 2064—or ever.” The Centers for Medicare and Medicaid Services, which runs the Medicare program, said this year that even in 2024 the Medicare hospital trust fund could still pay 87 percent of its estimated expenditures, and noted that, “in practice, Congress has never allowed a Medicare trust fund to exhaust its assets.”

Now, that last quote about Congress never allowing a Medicare trust fund to exhaust its assets is interesting, and I wonder what this current, do-nothing, insist-that-the-main-focus-is-defeating-Barack Obama GOP would do if they had no choice but to raise taxes or allow a Medicare trust fund to fail.

But what's the point? Why continue to push this idea that either of these two extremely successful social policies need to be reworked and revised?

Well, it's not about effectiveness; they're both very effective. It's not about efficiencies -- they're both fairly effecient, with low levels of fraud; in fact Medicare is far more efficient than private health plans. Do we need to worry about the costs of health care, which push up Medicare costs, just like it pushes up costs of other health insurance plans? Sure. But is it a flaw in Medicare? No. Same thing with SSI.

So it must be ideology. And it's a funny thing about that ideology -- it's been allowed to take root so long and so deep that even theoretical liberal journalists believe it needs to be paid at least attention to -- which is why Raddatz said it.

Comments

[telemann.livejournal.com]

Yeah, tired arguments that everyone has seen before. But here's a refresher:

Medicare Has Controlled Costs Better Than Private Insurance
.

• According to CMS, for common benefits, Medicare spending rose by an average of 4.3 percent each year between 1997 and 2009, while private insurance premiums grew at a rate of 6.5 percent per year (https://www.cms.gov/nationalhealthexpenddata/downloads/tables.pdf). (See Table 13)
• According to a calculation by the National Academy for Social Insurance, if spending on Medicare rose at the same rate as private insurance premiums during that period, Medicare would have cost an additional $114 billion (or 31.7 percent).
• The CBO explicitly stated that its data on relative cost growth should not be used to make the argument that Goodman and Saving make (http://www.cbo.gov/ftpdocs/87xx/doc8758/MainText.3.1.shtml), writing that the relatively low growth rate of all health care expenditures other than Medicare and Medicaid “should not be interpreted as meaning that Medicare or Medicaid is less able to control spending than private insurers.” Goodman and Saving mistakenly suggest that the growth rate of private insurance is the same as the growth rate of all health care expenditures other than Medicare and Medicaid; however, as CBO points out, the growth rate of all health care expenditures other than Medicare and Medicaid includes not just spending by private insurers, but also government programs and out-of-pocket costs paid by the uninsured.
• The CBO has predicted that the rising cost of private insurance will continue to outstrip Medicare for the next 30 years (http://www.cbo.gov/ftpdocs/108xx/doc10851/01-27-Ryan-Roadmap-Letter.pdf). The private insurance equivalent of Medicare would cost almost 40 percent more in 2022 for a typical 65-year old.

Medicare Has Lower Administrative Costs Than Private Plans.
.

• According to the Kaiser Family Foundation (http://www.kff.org/medicare/7731.cfm), administrative costs in Medicare are only about 2 percent of operating expenditures. Defenders of the insurance industry estimate administrative costs as 17 percent of revenue (http://www.cahi.org/cahi_contents/resources/pdf/CAHI_Medicare_Admin_Final_Publication.pdf).
• Insurance industry-funded studies exclude private plans’ marketing costs and profits from their calculation of administrative costs (http://www.cahi.org/cahi_contents/resources/pdf/CAHI_Medicare_Admin_Final_Publication.pdf). Even so, Medicare’s overhead is dramatically lower.
• Medicare administrative cost figures include the collection of Medicare taxes, fraud and abuse controls, and building costs (http://www.kff.org/medicare/7731.cfm).

[dwer.livejournal.com]

something, something, something, narrative.

[gunslnger.livejournal.com]

Yes, the reply I gave earlier showed the problems with those things.

[telemann.livejournal.com]

Yes, it's nothing new or compelling. Much like voter fraud evidence.

[mutive.livejournal.com]

Yeah, it's these kinds of studies that make me wonder why the solution to our health care problems *wasn't* to extend Medicare to everyone.

Oh, yes, I know. Because the elderly are an important voting block, but apparently the rest of the country isn't. *sigh*

(I know it's more complicated than that, but still...gah.)