You will accept our help or else

It's a story that could have been written by Franz Kafka.

Brian Hall, after many years of government service, retired from the Department of Housing and Urban Development (HUD) in 2006 at age 62. He started collecting Social Security benefits, but retained the health plan he had through the Federal Employee Health Benefits Program (FEHBP): a health savings account and catastrophic care combination plan from the Mail Handlers Union.

Hall just turned 65 and is now eligible for Medicare. But he wants to keep his current plan instead. Hall is willing to pay the premiums; he's not asking for any of the money back that he paid in Medicare taxes, and the Mail Handlers Union is happy to maintain his coverage.

Sounds reasonable, right?  After all, Medicare is supposed to be a "voluntary" program.

Not quite. The federal government is insisting that Hall accept Medicare, whether he wants it or not, or else.  If he refuses, they will confiscate his future Social Security retirement benefits and force him to pay back all the money he's received to date.

Never has the expression, "I'm from Washington and I'm here to help you" sounded more ominous.

Hall is one of five plaintiffs in a new lawsuit against the government asking that they be allowed to continue their existing health plans without sacrificing the Social Security benefits to which they're entitled – and for which they have paid tens of thousands of dollars in taxes.

The plaintiff's argue that while Medicare is an entitlement, an entitlement is not a mandate.  People are – or should be – free to decline to participate.

The government counters that the plaintiffs are free to not participate, but then they also cannot participate in Social Security. According to agency lawyers, the government has no way of not including Hall or the other plaintiffs in Medicare once they start getting Social Security.

Yet Hall has been receiving Social Security for the past three years without getting Medicare. It would seem that they could just continue doing what they have been doing. 

Early indications are that the U.S. District Court Judge hearing the case may agree.  Judge Rosemary Collyer, in a preliminary ruling on Hall's request that the court bar the government from enrolling him in Medicare while the case is in court, said, "It is passing strange that SSA [the Social Security Administration] insists that all persons receiving Social Security retirement benefits, a federal program that is running out of money, also must be part of Medicare Part A, another federal program that overruns budgets."

Judge Collyer is right to think that the rules in question – forcing people to participate in a program that can't afford to provide the coverage it's already providing – are more than a little strange.

After all, Medicare is currently facing $34 trillion in unfunded liabilities. And the program will be bankrupt by 2019, just ten years from now, according to Medicare's trustees.

One might think the government would encourage people to find other arrangements if they can. Instead, the government argues that they don't want a "two-tiered system" with some people getting Medicare and other people not.

But the reality is that Medicare is already a two-tiered system with some people buying supplemental coverage and others not.

Ultimately, the government is likely to lose the larger case. This practice of requiring Medicare enrollment for people receiving Social Security is not a law. Rather it is a bureaucratic edict, written during the Clinton administration and strengthened during the Bush administration, adopted without going through the procedures required for new regulations.

Hopefully it won't be too late for the plaintiffs – and the countless other seniors who want to forgo Medicare and use private insurance – by the time the case works its way through the courts.

For every senior cuffed by the heavy hand of government, there's only one guarantee:  Medicare will be that much closer to bankruptcy.

Greg Scandlen is president and CEO of Consumers for Health Care Choices, a Maryland-based grassroots advocacy organization, and a senior fellow at the Heartland Institute in Chicago.