Senate Democratic leaders managed to basically do away with the government-run insurance program in their health care proposal without causing a revolt among liberal members. They did it with a plan to expand Medicare to people as young as 55.
So far, the idea is proving too tantalizing to resist for even the most stalwart public-option proponents, who are willing to cast aside their original plan in part because expanding Medicare would in some ways go even further toward their goal of universal health care.
“It’s the camel’s nose under the tent,” said Michael Tanner, health care scholar at the Cato Institute, a libertarian think tank. “What they’ve always wanted is Medicare for all.”
But Tanner and other health care policy experts fear the proposal will create a massive set of new costs that will either add to the debt or be billed to seniors or taxpayers.
“This idea is pretty much nuts,” Tanner said, adding that the expanded Medicare program will likely attract only the sickest people, which could make it financially unsustainable unless the government charged higher premiums.
Senate Majority Leader Harry Reid, D-Nev., hasn’t revealed the details of the plan, but some of the 10 moderate and liberal senators who helped draft it said it would include a national health care plan modeled after the kind of insurance program offered to federal employees. It would also include a trigger for a government-run option if private insurers did not offer affordable private plans.
How the plan would pay for the Medicare expansion is unknown. While the new participants would have to “buy in” to Medicare, they may pay a reduced premium. If the government offers subsidized premiums to the new Medicare participants, the money will come either from cuts to programs for seniors or more new taxes, or be added to the $38 trillion in existing Medicare debt.
“What Democrats are saying is we are going to add to the existing Medicare long-term liability, unless they decide they are going to finance this thing with premiums covering the entire cost,” said Robert Moffit, director of the Center for Health Policy Studies at the Heritage Foundation, a conservative think tank.
Health care policy experts agree that the plan to expand Medicare would not interfere with the Senate Democratic proposal to pay for health care changes by cutting Medicare by more than $460 billion.
Those cuts, said Stephen Zuckerman, a health care expert at the Urban Institute, will reduce Medicare prices and services, but not enrollees.
Zuckerman said the Medicare expansion plan was appealing to Senate Democrats in part because it would not require creating a new government entity, which would have been required under the government-run plan.
“This is why the idea of building on an existing program, where you have an existing payment plan in place, makes a great deal of sense,” Zuckerman said. “It’s not as large a compromise for Democrats as it appears to be. This is still a publicly run program. People sometimes lose sight of that.”
