NCPA - National Center for Policy Analysis


December 11, 2009

Senate Majority Leader Harry Reid's (D-Nev.) latest "compromise" health care bill is 11th-hour legislative sausage that was made on the fly and includes ideas dating at least to the Clinton administration, says the Washington Post.

Most significantly, though, Sen. Reid's bill is a dramatic step toward a single-payer health care system, even if the public option is not on the table, says the Post:

  • Sen. Reid's latest compromise allows uninsured individuals over 55 to buy into Medicare.
  • That policy brings with it numerous problems, the core of which are higher costs to taxpayers, squeezing individuals out of their private coverage (including retiree coverage from a former employer) and adding costs to an already-unsustainable Medicare system.

Why would costs skyrocket? 

  • As the Post notes, sicker seniors might flock to Medicare, thinking that the government will be more likely to approve their treatments, which would raise premium costs and, correspondingly, the pressure to dip into federal funds for extra help.
  • In other words, sicker seniors would move into the public pool, costs would go up, and so too would taxpayers' bills.

There are more questions than answers, as the Post points out, regarding reduced reimbursements to health care providers and further expansions of Medicare:

  • Presumably, the expanded Medicare program would pay Medicare rates to providers, raising the question of the spillover effects on a health-care system already stressed by a dramatic expansion of Medicaid.
  • Will providers cut costs -- or will they shift them to private insurers, driving up premiums?
  • Will they stop taking Medicare patients or go to Congress demanding higher rates?
  • Once 55-year-olds are in, they are not likely to be kicked out, and the pressure will be on to expand the program to make more people eligible.

Source: Miek Brownfield, "Legislative Sausage Health Care Plan Could Lead to Single-Payer Insurance," Heritage Foundation, December 10, 2009; based upon: Editorial, "Medicare sausage?" Washington Post, December 10, 2009.

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