Does Obama Plan to Deny Seniors Medical Care?
“A good man leaves an inheritance to his children’s children…”
Proverbs: 13:22
Besides leaving the inheritance of a mortgaged future to our grandchildren and their grandchildren ad infinitum, we are guaranteeing that future retirees will not receive the health care they have been promised under Medicare. The government’s current plan will simply devolve into denying care and letting people die prematurely. The problem lies in a demographic shift as Baby Boomers retire with too few workers for every retiree. Moreover, raising taxes on the rich won’t solve the problem even if economic growth would somehow not be damaged. The rich just don’t have the trillions of dollars required. There is a reason we don’t hear of trillionaires. They don’t exist. We could raise the tax rate to 100% on the wealthy and confiscate all the assets of every billionaire in America, and we still wouldn’t have sufficient funds.
Think I am exaggerating? David Walker, the highly respected, non-partisan chief accountant for the government described our dilemma this way, back in 2007, when the economy was still growing.
“Well, you could decide not to renew the Bush tax cuts, you could eliminate all foreign aid, eliminate all earmarks, eliminate NASA, eliminate the National Endowment for Humanities and eliminate the entire Defense Department tomorrow, and you still wouldn’t solve the problem.”
http://www.newsweek.com/id/70378/page/5
How much are we in the hole?
“….we promise way more than we can afford to keep. Eight trillion dollars added [for prescription drug benefit] to what was already a 15 to $20 trillion under-funding. We’re not being realistic. We can’t afford the promises we’ve already made, much less… piling on top of ‘em.” “
http://www.cbsnews.com/stories/2007/03/01/60minutes/main2528226_page2.shtml?tag=contentMain;contentBody
Since 2007, the situation has become much worse with the current recession. Besides lacking the 23-28 trillion in the bank we would have needed then, we have an 11 trillion dollar national debt with President Obama planning to double that in the next 8-10 years, even assuming a rosy scenario of high growth. Does anyone really think the wealthy have the resources to cough up somewhere around 50 trillion dollars?
Obviously, the government should reverse course and cut spending and government expansion in preparation for this demographic tsunami. Any stimulus spending should have been (and any new spending should be) true investments where we think we can speedily recoup that money such as incentivizing more domestic oil, natural gas and alternative energy so that the hundreds of billions we send overseas are spent here. Unfortunately, current policy has us heading in the opposite direction, spending and borrowing even to the point we are having diffculty finding buyers of the government’s debt. In the not too distant future, we will likely be unable to sell any more debt and will be forced to simply print money with the FED buying our debt as is already occuring. We should be saving this credit to help fund our health care obligations to retirees.
But even if we drastically cut spending, we will still have a shortfall. There are basically two hard choices, or a combination of both, facing retiring Baby Boomers: reduce costs by rationing health care or reduce demand by raising the retirement age.
Option One: Rationing Health Care
This is the current plan under discussion packaged as finding “savings.” What that means in reality is denying medical services to people that need it with the result of people dying prematurely and a reduction in quality of life. We can deceive ourselves that just being more efficient alone will generate the trillions needed, but the stark reality is even accepting the dubious proposition that more government beaurocracy can help us save a lot of money, we are not going to save but so much.
Option Two: Raising the Retirement Age
The second option is rather than deny services to people that need them, the Boomers could decide to actually pay for them by demanding the government raise the retirement age with everyone working longer in order to fully fund the system. That would dramatically balance the demographics by adding more workers and less retirees. Of course, that would probably also necessitate a change in overall government policy. If the Boomers en masse agree to working longer, you can bet there will be serious calls for curtailing government spending, whether on social programs, national defense or bail-outs for Wall Street and unionized companies.
Which choice is best?
Probably only a portion of Baby Boomers would suffer under reduced health care and prescription drugs. People could choose to take the chance that they’d be in the group that will not need those services, or take the other route and mitigate that risk and also make sure their fellow Americans are well taken care of. Putting off retirement and working longer may be unpleasant for many but nevertheless, more attractive than hoping the government will magically find a pot of gold. With the government already having difficulty finding buyers for it’s debt, the stark reality is that this choice simply cannot be ignored. To do nothing is to choose to deny needed, critical medical services to people that need them. The money just isn’t there.
The political reality is neither party will touch this issue, nor even openly admit and discuss solutions to the problem unless they believe they have grassroots support, especially from those that will be most affected and that means the Baby Boomers. The cold truth is both parties have raided and wasted social security, medicare and the Treasury in general and are contining to do so. They do not want to highlight the fact they’ve taken all the money the Boomers paid in and wasted it so that we are bankrupt and cannot adequately keep our promises for retiree medical care. The politicians thus far are keeping quiet so it is up to the people, and in this case, the coming retiring Boomers to speak up. In their youth, the Boomers were labelled the Me-Generation whether fairly or not. Perhaps today they will become the We-Generation calling for and making the necessary sacrifice to insure the nation’s fiscal survival and the health and well-being of their fellow retiring Boomers.
6 Responses to “Does Obama Plan to Deny Seniors Medical Care?”
Will
Your basic premise is wrong on several levels:
1) All our out year budget problems exist for one reason, rising health care costs. If we control the growth in health care spending we solve our budget problems.
2) The economy has already determined retirement is a long way off for most baby boomers. Most saw at least a 30-40% loss in investment income between their 401K’s and loss of home equity. Most boomers will work well into their 60’s assuming they can find a job.
Social Security is easily fixed. If we change the cola from prices to wages and have every retiree that enters the system take a one time 10% cut in benefits we solve SS funding.
The political will to fundamentally change health care’s growth in spending or reform SS doesn’t exist so the idea of “fixing” the problems is out in the distant horizon somewhere.
I wouldn’t go as far as to say that there is no political will to reform SS. There are many Republicans and conservatives who desire to reform Social Security and wanted to push legislation through a few years ago. The Democrats’ were able to force Reps from backing down by playing to the fears of Older Citizens, saying that Republicans would risk their money in the stock market. In reality, under Bush’s plan the older citiznens were still guaranteed the same benefits. Also, no one had to invest their money, all citizens would have had the choice to opt into the same SS program, whether they didn’t trust the market or didn’t understand their options. It was younger citizens who would be given the opportunity to do more with their money and invest it. In reality, implementing this would be doing more for our economy than any of the Democrats stimulus bills. In the past 5 months American incomes have increased by $121 million, mostly from the stimulus, but our saving has increased by $131 million. None of the stimulus money is being spent by consumers, it is being locked away under their beds. SS reform would have led to automatic increases in investment. Several economic reports have estimated this increase in investment would increase GDP by 4-6%.
Donald,
“All our out year budget problems exist for one reason, rising health care costs. ”
Not really, and you are missing the point. The upcoming problem is a demographic one. Yea, we can save money by denying care, and that’s exactly what the democrats are pushing.
“The economy has already determined retirement is a long way off for most baby boomers. Most saw at least a 30-40% loss in investment income between their 401K’s and loss of home equity. Most boomers will work well into their 60’s assuming they can find a job.”
Still won’t be enough. Well into 60s isn’t going to solve the problem, not even close. Take a good look at the numbers. The former comptroller isn’t partisan. You could eliminate nearly everything else in the budget and still not pay for Medicare. That means no national defense, no Homeland security, etc,…and we know that won’t happen. We need far-reaching and drastic cuts across the board and some way to balance the demographic nightmare.
“Social Security is easily fixed. If we change the cola from prices to wages and have every retiree that enters the system take a one time 10% cut in benefits we solve SS funding.”
More easily fixed than Medicare but I’d like to see your numbers because I don’t think a 10% cut will do it, not even close.
Ryan is right. The Republican conservatives are the only ones attempting to solve the problem. Dems would rather politicize it and basically kill off retirees early to save money.
interesting, related article….
“Congressional Democrats will soon put forward their legislative proposals for reforming health care. Should they succeed, tens of millions of Americans will potentially be joining a new public insurance program and the federal government will increasingly be involved in treatment decisions.
Not long ago, I would have applauded this type of government expansion. Born and raised in Canada, I once believed that government health care is compassionate and equitable. It is neither.
My views changed in medical school. Yes, everyone in Canada is covered by a “single payer” — the government. But Canadians wait for practically any procedure or diagnostic test or specialist consultation in the public system.
The problems were brought home when a relative had difficulty walking. He was in chronic pain. His doctor suggested a referral to a neurologist; an MRI would need to be done, then possibly a referral to another specialist. The wait would have stretched to roughly a year. If surgery was needed, the wait would be months more. Not wanting to stay confined to his house, he had the surgery done in the U.S., at the Mayo Clinic, and paid for it himself.
Such stories are common. For example, Sylvia de Vries, an Ontario woman, had a 40-pound fluid-filled tumor removed from her abdomen by an American surgeon in 2006. Her Michigan doctor estimated that she was within weeks of dying, but she was still on a wait list for a Canadian specialist.
Indeed, Canada’s provincial governments themselves rely on American medicine. Between 2006 and 2008, Ontario sent more than 160 patients to New York and Michigan for emergency neurosurgery — described by the Globe and Mail newspaper as “broken necks, burst aneurysms and other types of bleeding in or around the brain.”
Only half of ER patients are treated in a timely manner by national and international standards, according to a government study. The physician shortage is so severe that some towns hold lotteries, with the winners gaining access to the local doc.”
http://online.wsj.com/article/SB124451570546396929.html#mod=rss_opinion_main
Will
From the medicare annual report in 2008:
“Social Security could be brought into actuarial balance over the next 75 years with changes equivalent to an immediate 16 percent increase in the payroll tax (from a rate of 12.4 percent to 14.4 percent) or an immediate reduction in benefits of 13 percent or some combination of the two. Ensuring that the system remains solvent on a sustainable basis beyond the next 75 years would require larger changes because increasing longevity will result in people receiving benefits for ever longer periods of retirement.”
There are other options that have been presented. For example, changing the Cola from prices to wages picks up huge savings over time. Incorporating that into a one-time reduction in first benefits (which also represents huge savings over time) fixes SS forever.
Fixing medicare is simply getting the greedy out of the way so we can care for the needy. The benefactors of the current system (mostly hospitals, big pharma & insurance companies) will fight any meaningful change tooth and toenail.
As I have said in other posts there are two places to reduce the cost of healthcare w/o limiting care: best practices lowers the price by 25-29% according to CBO & Dartmouth studies and there is 10-15% to be picked up by going to single payer (no advertising/marketing/profit/sales function to cover).
That’s your healthcare reform that provides world class care at a cost we can afford.
I would love to see what a 13% decrease in benefits would do to middle-lower income elderly folks. The folks who have worked their whole lives and given money to SS, many of whom already live pay check to pay check with their current benefits. In reality, though, I would like to see what this decrease would do politically to the Democratic party. I hope you can push this through Donald.