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Medicare for all

Medicare for All – Part II

Published in The Journal Record
January 29, 2020

Last month we learned that President Lyndon Johnson needed help with social conservatives to pass Medicare.  Enter United States Representative from Arkansas, Wilbur Mills.

Mills chaired the House Ways and Means Committee which made him a very influential legislator.  He foresaw the likely possibility that if Medicare were passed it would be but a short time before members of his party would demand something similar for the rest of the country.  He devised companion legislation that was dubbed Medicaid to forestall this anticipated desire to expand Medicare to the entire population. 

Mills did several things that were particularly pragmatic and far-reaching.  He suggested that Medicaid should cover certain categories of the poor, particularly those with the greatest public enthusiasm such as pregnant women, children, and the poor elderly.  In addition, he was particularly clever in making Medicaid a joint federal/state program with the states paying roughly half the cost, but also maintaining control over who and what was covered and what providers  would be paid. 

As would be expected, any government program such as Medicare was likely to be opposed by a conservative coalition of conservative Democrats from the south and northern Republicans.  Anticipating this Mills knew that conservatives love programs where the state had considerable autonomy.  Thus, he was able to pull off a hat trick by aligning Medicare and Medicaid together but allowing the states to have considerable control over Medicaid and  significant leverage in how the program would be managed within their state. 

So, in July 1965 Lyndon Johnson signed both the Medicare and Medicaid programs into law – Medicare, an individual tax supported insurance program for the elderly; and Medicaid, a social welfare program funded by the federal and state governments designed to help certain categories of the poor. 

Today Medicaid covers 59% of low-income children.  States pay, in general, 17% of their general fund into the program.  It covers 60% of nursing home residents and 37% of child births.  Mills, therefore, eliminated until this very point in our history the call to expand Medicare to the entire population.  His artful maneuvering of the political system eliminated the desire for a “Medicare for All” program until today, with the Democratic party clearly moving in that direction. 

We must admit that Wilbur Mills was spectacularly successful in avoiding a single payer system for two generations.

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Medicare for All – Part I

Published in The Journal Record
December 18, 2019

If you have watched the Democratic debates recently you’ve undoubtedly caught the passion that several of the candidates have for the concept of “Medicare for All.”  The ideological debate ranges on the one hand from eliminating private and employer-based insurance that would move all of us into a Medicare-like program, to the alternative being proposed by more moderate contestants to give all of us a choice to sign up for a Medicare program should we desire. 

Most of the pundits are noting that this debate over the extension of Medicare is a new political phenomenon representing how far to the left many Democratic candidates are approaching.  The truth is that while the passion evidenced around the concept may seem new and different, its roots go back more than sixty years. 

One of the signature programs of President Lyndon B. Johnson in 1964 after he decisively beat Barry Goldwater was the establishment of a health program for the elderly.  This program was to be financed by a combination of payroll taxes from both the employer and the employee.  The idea was that most people were retiring in their 60’s and losing their employer-sponsored health coverage program thus making them liable for extreme health expenses at the very point in their life when they were least able to afford them. 

President John F. Kennedy had been assassinated in 1963, and his vice president, Lyndon B. Johnson, became president. Because of sympathy for the elderly among the general population and because of Johnson’s significant legislative skills and his recent electoral mandate, passage of Medicare seemed very likely.  Johnson had several key programs (including the Voter Rights Act) that he was intent on passing. He skillfully used the dead president’s legacy to gain legislative advantage, but he needed help to pass Medicare.  He got his help from an unlikely source, a politically conservative legislator from Arkansas.

                Enter United States Representative from Arkansas, Wilbur Mills.

Next month in Medicare for All – Part II we shall see how Wilbur Mills used the popularity of several conservative concepts to get Medicare passed.

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A Slow or a Quick Death?

Published in The Journal Record
October 23, 2019

Most people, when asked about their death, commonly respond that they would like to pass away quietly in their sleep at a very old age, not having suffered any lingering illnesses. A quick quiet death is preferable to a long painful one.  If we can judge by the rhetoric of the Democratic candidates for president we are in the process of choosing between a quick death for private health insurance if Medicare for All is passed, or a slow lingering passage if the more conservative candidates have their way and a public option is draped around the Affordable Care Act (commonly referred to as Obama Care).

                The public option is an idea that was floated during the debate over ACA but was never included in the final legislation.  The basic concept is that the federal government would be able to compete with private insurance in a competitive marketplace where individuals and companies would have the choice of selecting a Medicare-like program or plans offered by private insurance companies.  What could be fairer?  The insurance companies and the government could compete heads up for America’s insurance business.  There is, however, one significant problem.  Currently medical providers in this country negotiate with private insurance companies on pricing.  Larger, more powerful, and more complex health systems have an advantage in this negotiation than small rural clinics and hospitals.

                The point is, there is a negotiation.  In the Medicare program there is no negotiation.  The government decides what they will pay, and providers can either accept it or refuse to take government funded patients.  In a public option program this gives the government huge advantage on the cost of coverage.  Because of this advantage private insurance will soon find it cannot compete because the government’s ability to purchase services at far cheaper rates.  What this means, of course, is that over time private health insurance would be at such a disadvantage that they would find themselves in an impossible competitive position.  This would lead to a slow death of private insurance.  Medicare for All essentially eliminates all private insurance.  A public option eventually squeezes all competitors out of the market.  Either way America ends up with a single-payer system. 

Take your pick, a slow or a quick death.

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