The Republicans are proposing a wide-ranging change to Medicare and they are all walking in lock-step to the same drummer; the drums of moving the cost of this recession onto the backs of the poor and the elderly, while at the same time, giving as much money as possible to large corporations, in this case, the giant insurance companies.
Under the Paul Ryan plan, Medicare as we know it today, would disappear from the American landscape and would be replaced by Federal subsidies to help pay for private insurance that would be issued by insurance companies. In some ways, it mirrors President Obama's health care plan, because both rely on private insurance companies to issue the actual insurance. I oppose both for that very reason; the involvement of private insurance companies in what, in the case of Medicare, has always been a government program that was paid for by everybody through payroll deductions. A real national healthcare plan, when one is finally put in place, should be a truly government program, and paid for in same way as medicare is paid for now.
Having worked as a consultant to several large insurance companies, I can tell you one thing for sure, and that is insurance companies are not in the business of paying claims; they are in the business of collecting premiums. You can rest assured as health care costs go up, the insurance companies will raise the premiums and not just by the % of the rising cost but the % plus a profit and not a small profit at that. Just like they have raised the premiums each and every year on almost every single kind of insurance they issue but, in particular, health care premiums. Overall, Insurance company profits were up 56% in 2009 (last year available) even though 2.7 million Americans lost their insurance that year and some companies, especially those involved in group health, did much better than that. To wit: Wellpoint increased profits in 09 over 08 by, are you ready?, 91%! United Healthcare was a real pauper, increasing only 28% in same period while , at the same time, losing 3.9% of enrollment. However, the real winner was Cigna, who dropped 5.5% in enrollment, but increased profits by 346%! A private insurance company must make a profit and, as figures show, they do a good job of that. Government insurance, on the other hand, is not required to meet a profit figure and is only obligated to pay the bills plus maybe a percentage to cover rising health care costs in the next year. In addition, if government stays in the medicare business (so to speak), they have a huge advantage over private companies because of their control of all the payments, which helps them negotiate costs for hospital stays, costs of surgery, cost of drugs, etc. etc. Whereas private companies can, and do negotiate, but to their advantage, not that of their customers. Plus, on the philosophical side, Medicare and Social Security were, and are, a promise made to the American People by the American government. To change it now, after people have paid in all their lives, would be unconscionable and the breaking of a sacred trust.
To anyone who is really, truly, serious about Social Security and Medicare reform, the answer is quite obvious...make everyone pay into the system on all income. For instance, how fair is it for a private person, in business for themselves, to pay 12.4% into social security with a max of $11,107.20 (this year but is going up next year), whereas someone making 100 million dollars per year would still pay the same $11,107.20 they and no more. Yet the very same multimillionaire is still eligible for medicare and social security.
To wrap this argument up, let me say that I trust the Social Security Administration a whole lot more than I trust any insurance company. Plus I can petition my government, but I cannot petition an insurance company. Social Security and Medicare are two of the most successful government programs of all time let's keep them that way.
