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Manning my trusty treadmill at the gym last night, I watched Laurence O'Donnell debate a woman who had passionately called at a townhall for a return to the kind of nation the founders envisioned.  His primary strategy was to ask her if she wanted to repeal Medicare, which he characterized as "smart, pragmatic socialism."  

The idea here is that, hey, Medicare works to cover seniors and therefore we could just cover everyone with a Medicare style plan.

This idea, voiced by Laurence O'Donnell who should know better, is not a good one.  Medicare works, to the extent that it does, because it is basically parasitic on the private market for healthcare.  Doctors are able to earn reasonable compensation (given their training, skills, and level of difficulty of the work) because of the existence of that private market.  All Medicare does is to provide a way for a segment of the market, lower income seniors, to pay for healthcare.  Many physicians will accept that reduced payment from Medicare because:

They want to help patients, including those who often can't pay much

They have the money earned in the private market to allow them to handle the poor payments from Medicare.

Without the private market, can you imagine doctors paying for their substantial overhead (including massive prices for malpractice coverage) on what they make from Medicare alone?  Government solutions work somewhat acceptably at the margins, but not when they overtake the market completely.  Pointing to Medicare is not a way to win the argument for a government option available to everyone.

View all comments (3) | Leave a comment

Red Phillips| 8.13.09 @ 1:02PM

"I watched Laurence O'Donnell debate a woman who had passionately called at a townhall for a return to the kind of nation the founders envisioned. His primary strategy was to ask her if she wanted to repeal Medicare"

I don't technically disagree with your explanation, but the answer here has to be "Yes." It can't practically be abolished overnight, but neither can you concede the constitutional legitimacy of it. You can't cite the Founders and question the constitutionality of a new program but say you are just peachy with an established program that is not authorized either without undermining your credibility.

Brubaker| 8.13.09 @ 2:21PM

"All Medicare does is to provide a way for a segment of the market, lower income seniors, to pay for healthcare."

If that were true, Medicare might actually be a good program. The reality is different. All Social Security recipients, age 65 and above, are automatically enrolled in Medicare Part A, like it or not. If you have private insurance and are happy with it, tough! Medicare becomes primary and your private insurance becomes secondary.

People who do not want or need Medicare benefits are literally forced to take them. Is that any way to save money? Of couse not, but it is a good way to exercise government control.

Bo Darville| 8.13.09 @ 2:29PM

Good post. The other argument that I don't like is "but the uninsured are costing the taxpayers $100,000,000 a year!" So, the solution is to pay $2 trillion instead of $100 million?

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More Blog Posts by Hunter Baker

http://spectator.org/blog/2009/08/13/killing-the-but-we-have-medica
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