Although I agree with him that something needs to be done about Medicare in particular I can’t say that I share Robert Samuelson’s zest for letting Medicare go bankrupt:
Like General Motors and Chrysler, we continue self-defeating habits because we can—temporarily. These are not easy issues. But procrastination is a bad policy. The longer changes are postponed, the more wrenching they will be. The hurt for retirees and taxpayers alike will only grow with time. Social Security last faced a forcing event in 1983, when a dwindling trust fund prodded Congress to make changes. The counterintuitive lesson: a “crisis” is just what we need.
I am not a radical; I have never believed that “the worse, the better”, in Nikolai Chernyshevsky’s famous formulation. The reasons that Social Security and Medicare were adopted in the first place remain true. Without those two programs we’d have large numbers of seniors living in really serious poverty with little way to get themselves out.
As long as that’s the case I strongly suspect we’ll continue to have some sort of program of mandatory government pre-paid retirement and some sort of program to help needy seniors with their medical bills so in that sense neither program will ever go bankrupt.
One point on the statistic that Mr. Samuelson quotes:
In 1940, life expectancy at birth in the U.S. was 61.4 years for men, 65.7 for women; by 2008, the comparable figures were 75.4 and 80.
“Life expectancy at birth” continues to be poorly understood by most people and I can see that Mr. Samuelson is no exception. In 1900 the life expectancy at birth for men in the United States was 46.3 years. It rose a whole 15 years from 1900 to 1940 almost entirely on the basis of decreased infant and child mortality. Between 1940 and 1960 it rose to 66.6, again largely based on a reduction in infant and child mortality.
How do I know that? Because the male life expectancy at age 65 in 1950, long before the introduction of Medicare, was 12.8 years for a total age of 77.8 years. It’s only risen five years since 1950.
The problem with Social Security and Medicare isn’t that people are living longer although the facts that people are living longer and are healthier farther into old age do present an opportunity to adjust the ages at which these programs “kick in”. The problems with Social Security and Medicare are different for the two programs.
The problem with Social Security is that for a variety of reasons including the structure of Social Security, globalization, technology, and structural changes in our economy, not enough income is subject to the tax. If income growth since 1975 had been faster in the lower four quintiles, the issue of Social Security insolvency would be off the map.
Medicare is a completely different kettle of fish. By 1975 due to increased demand and price increases the program had already gone beyond the budget that had been expected for it. After 1975 the program was under increasing scrutiny but by then it was too late. After that inflation alone accounts for the cost growing beyond our ability to pay.
Social Security can be corrected by a combination of adjustments to the Social Security retirement age, to the formula by which benefits are calculated, and by making more income subject to the tax. Fixing Medicare will require fixing healthcare itself but that, too, can be accomplished through a combination of reducing demand through taxing benefit programs and means-testing Medicare and increasing supply by training many more physicians assistants, relying more on physicians assistants, and making significantly more and better use of technology, e.g. home testing and telemedicine.
Electronic imaging and medical record keeping coincidentally happens to be an area in which I have legitimate expertise. The Obama Administration is overestimating the savings that can be achieved by that means.
This has some roots in history, as well. If I recall correctly, one of the reasons why you would see life expectancies in the thirties and forties before a couple hundred years ago was not because people were simply dropping dead at age 40 in Medieval Times. It was because of the very high infant mortality rate, which was part of a greater trend involving very high mortality risk for children under the age of five. Once you got beyond that, as long as you didn’t catch a fatal illness, or get an infected cut, or die in battle or childbirth, you could often live into your fifties at least, and often sixties.
You’d basically have to turn Physicians’ Assistants into almost a giant class of “sub-physicians”, to something almost like a general practioner, in order to get something like this, I would assume. You’re talking about upping the supply of medicine, right?
Basically, I’m talking about extending the model that dentistry has followed into the practice of medicine. Many dentists employ, supervise, and review the work of multiple hygienists who do the work that dentists did 50 years ago.
Ah, I see. I didn’t grasp it at first, simply because I’m not old enough to actually have known a period when dental hygienists didn’t do most of the routine stuff, and a lot of the non-routine stuff.