Saturday, August 29, 2009

The Democrats Problem is Medicare

Medicare was originally a modest subsidy for health insurance for the elderly. The enabling legislation that created medicare was signed into law by President Lyndon Johnson in 1965. At the time, the American economy was in good shape, elderly persons in America received good health care, and health care costs were reasonable, though rising faster than other costs. In the 1970s, the required contribution by seniors to medicare was lowered from one-half to one-fourth.

The prescription drug bill created Medicare Part D, which went into effect in January of 2006 and added greatly to the overall cost of Medicare.

The original version of medicare required seniors to pay one-half of the cost of the insurance. The projected cost of medicare, President Johnson warned, could be as high as $ 2 billion annually. (In 2007, the total bill for medicare was $ 440 billion). Medicare is funded partly by payroll taxes collected alongside social security payroll taxes from employees and employers. The remainder is either unfunded or brought in by ever increasing mandated payments from states (this is the main item leading to catastrophic deficits for state governments).

People who use medicare are paying only a small part of the true cost of their own medical care. Even at that, the current unfunded liability of medicare is $ 34 Trillion. Within two generations, most of our gross domestic product will be devoted to medicare, leaving very little for anyone under 65 years of age to consume -- medical or otherwise.

This is the Democrats idea of a great program. But, this is also their great problem. How can they spend money on all of their other projects if medicare sucks everything up?

The answer: why not expand it? It is going to go broke anyway. So who cares?

This appears to be the Obama philosophy. If only the public would pipe down, Obama could effectively expand medicare to the entire population.

If medicare were to expand to the entire population, which is the ultimate thrust of all of the Democratic reform bills, what then? First, wait about eight years until you-know-who is out of office. Then, when the nation is on the brink of insolvency because of health care "reform" passed in the first Obama Administration, bring in the efficiency experts.

The efficiency experts will realize, as the Brits have known for a couple of decades, that a government health care plan has to sacrifice some demographic, since the system is so incredibly inefficient. In Britain, they have decided to sacrifice those over 65, who are not a priority for any medical operations. Not many of that group die on the operating table. They die, instead, in the waiting room. The vast majority never make it to the operating table. The waits are simply too long.

No doubt, the plan -- long run, is to do a similar thing in the US. Once everyone is on medicare, the only way to cut costs is to eliminate health care for certain groups of the population. Who needs cancer and heart surgery anyway? That only applies to old people. Perhaps a bit of counseling will help these old folks see the light. This kind of thinking seems to be behind the Obama health care strategy for the long term.

Meanwhile, those who need abortions will have access to all the funding they need. Similarly, obese people should turn in their gym cards. They will be covered for everything they need, so long as they have not attained the age of 65. The money saved from eliminating most coverage for surgery and other operations for the the over 65 set can be devoted to aids sufferers, drug rehabilitation, alcohol rehabilitation, and psychological adjustment counseling (depression, etc.). After all, these are becoming pretty serious matters.

Unfortunately for Obama and the Democrats, the elderly aren't all completely senile and they can see clearly that Obama has them in their sights. Even doctors and hospitals are beginning to wake up to the implications of "cost cutting" in health care. Insurance companies, who have just about the lowest profitability of any industry in America and the lowest paid senior management, are beginning to wake up and listen to Obama and others decry their non-existent profitability. Finally, the average American can see where this is headed. Obama and Pelosi and their ilk will never be subject to these plans since government largesse and their own personal wealth will keep them from ever having to access this nightmare that Obama is creating (yes, Obama purchased a $ 2 million home three years before running for the presidency...not something a non-wealthy person could even dream about).

Obama had indeed fooled most all of the people for some of the time. Thank goodness, he cannot fool all of the people all of the time. Virtually every American is beginning to see through the health care reform charade.