NCPA - National Center for Policy Analysis

Medicare is Single-payer Insurance for The Elderly

January 10, 2002

The current system of health insurance for America's elderly population forces seniors into a single-payer health care system that restricts choice and freedom to choose one's own health care, according to author Sue Blevins.

Medicare is the single largest payer for health care in the United States. Enrollment in Medicare is largely mandatory -- giving the federal government the final say on hospital and physician fees. Medicare prevents seniors from contracting privately with the doctors and health providers of their choice.

Blevins says Medicare coverage is not as good as people think:

  • Medicare's limited coverage doesn't protect seniors against catastrophic medical costs.
  • It also fails to cover many routine health services outside the hospitals, such as prescription drugs, dental care, eye examinations, and physical examinations.
  • Seniors now pay about as large a share of their income for out-of-pocket medical costs as they did before Medicare -- and the percentage is projected to rise higher in coming years.

Seniors cannot refuse Medicare hospital coverage without forfeiting all of their Social Security retirement benefits, and there are no insurance products sold to seniors in lieu of Medicare coverage. In addition, the federal government prevents Medicare beneficiaries from paying physicians privately for Medicare-covered services.

Budget analysts have been warning for years that Medicare's financial future is far from secure. Medicare expenditures have grown much faster than originally projected. Without meaningful Medicare reform, seniors will likely face fewer choices and higher prices in the future.

Source: Sue Blevins, Medicare's Midlife Crisis (Washington, D.C.: Cato Institute, 2002).


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