McCain's Erratic Health Strategy: Now He's Slashing Medicare
Those of us who analyze health policy and trends for a living have struggled to follow John McCain's health plan through its many seemingly-improvised changes. First he was taxing health benefits through both payroll and income tax. Then he said he only intended to apply income tax, which meant that his plan would create even larger deficits. Now he says there won't be deficits, because he's going to make up the cost of those tax credits by slashing Medicare and Medicaid.
When a candidate suddenly, almost whimsically changes the way he proposes to handle $1.3 trillion - which is the amount of money his plan puts in play over the next ten years - it's time to get nervous.
We already knew the McCain plan was going to cost most Americans money (in at least three different ways.) Now we know it could jeopardize their medical care when they get older, too. The end result of this off-the-cuff planning could change the way Americans receive, or don't receive, medical care in this country.
Even though the Washington Post gave Joe Biden "two pinocchios" for his remarks about the McCain health plan, a careful reading of even their critique shows that Biden told the real story. Middle-class wage earners could save something in the first year, but that amount would dwindle over time and eventually become a deficit. And the number of uninsured would actually increase over the long term, according to unbiased studies.
McCain's campaign is now saying that he has given up on the idea of taxing payroll taxes for health benefits, or that it was never intended in the first place. Yet the distinction was not drawn for quite some time, making it appear like a relatively last-minute tweak. Some lobbying may have been involved, too, since this change also insures that corporations won't have to pay a portion of McCain's tax increases. (Companies have payroll tax obligations, too).
With this change, conservative estimates now place the initial number of people losing employer benefits at twenty million. These twenty million people will have $5,000 in credits to buy $12,000 worth of coverage. And that $12,000 figure could rise rapidly without the bulk-buying power and employee satisfaction concerns of employers. (Yes, they do have them.)
McCain is also proposing to dismantle a number of the state rules governing insurance. The way carriers set rates, their ability to deny care, and other practices might be stripped of current consumer protections in many parts of the country. That $12,000 figure could skyrocket as these rules are lifted and as more coverage is transferred to from group to individual policies. (Individual rates tend to be lower now because enrollees tend to be younger and healthier. That will change, perhaps drastically, as the rest of us move in and other factors take over.)
It's important that Americans understand the implications of these changes. We should continue to discuss the uninsured, but it's also important to consider the underinsured - which now includes most of us to some extent. Insurers are covering less and less of the cost of care for those of who have coverage. As a result, personal medical indebtedness is increasing, even as credit is getting harder and costlier to obtain.
So we're talking about at least three kinds of health "tax increases" (more accurately described as increased personal cost) under the McCain plan: a "slow bleed" for people who retain coverage as the tax credit falls behind inflation, a $,7000-plus spike for people who lose their coverage immediately, and an increase in out-of-pocket costs (and denials, etc.) for people who still have insurance. What do we get in return? According to that neutral study, three million uninsured would gain coverage - briefly. After five years the number of uncovered would go up.
About this new Medicare/Medicaid wrinkle: Now that he's dropped the payroll tax idea, estimates show that McCain's plan would cost $1.3 trillion over the next ten years. But today, as Jonathan Cohn reports, he decided to zig instead of zag. He says he's going to make his plan revenue-neutral by cutting Medicare and Medicaid to make up the difference.
Specifically, McCain's campaign says " the savings would come from eliminating Medicare fraud and by reforming payment policies to lower the overall cost of care." Yet I know of no credible studies saying there is that kind of savings to be found in Medicare. By "reforming payment policies," they mean paying doctors and hospitals less. That means less treatment, less access to care, and a variety of other drastic problems for the one program we'll all join (if we're lucky enough to live that long.) There will also be severe repercussions in the health economy, too complex to go into here.
That means there's now a fourth way that McCain's plan will increase your out-of-pocket healthcare costs. When you cut Medicare and Medicaid payments to doctors and hospitals, they charge private payers more to help make up the difference. That means insurance will cost even more as a result - but that $5,000 won't be increased to cover the difference.
The McCain people also say their new credit will help prevent some low-income people from joining Medicare, further reducing costs. But how many low income people can make up the difference between the tax credit and the real cost - $7,000 and rising fast?
The conclusion seems impossible to avoid: McCain's health care ideas are risky, unstable, and poorly thought out. They could result in a 'healthcare meltdown' that Americans can ill afford. You don't want the surgeon who's operating on you to "wing it." The same is true for the President who can determine whether you can afford that surgery in the first place.
RJ Eskow blogs when he can at:
A Night Light
The Sentinel Effect: Healthcare Blog
Future-While-U-Wait
Follow RJ Eskow on Twitter: www.twitter.com/rjeskow
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RJ, you and I both know how the system works. With that $5k ($2.5k for individuals) going directly to the healthcare companies, the premium balances billed to purchasers will magically increase at an historic rate, and the copays and deductibles will also increase, while max coverage amounts will decrease.
That McCain plans go after Medicare should come as no surprise. Palin foretold this when she read her talking points "we'll tell our children and our grandchildren of a time when..." that came directly from Reagan's 1960's speech that was supplied to housewives and their gal pals. That speech was against the formation of Medicare.
PEACE
Taxing medical benefits is INSANE. If a person has a serious operation, the benefits paid might well exceed his or her annual salary. Besides, the recipients of the medical benefits are paying income taxes on what they receive. How many times do you have to tax the same thing?
The best approach to broaden health coverage is simply to allow anyone to use military medical facilities. Military people receive free medical care. That should be extended to the uninsured, who could be treated in military facilities, but at a lower priority.
That's cheap and easy. Problem solved.
Slash and burn the elderly and those in need
I am so dumbfounded at the behavior of John McCain that I am beginning to believe one of two things:
McCain is literally suffering from some form of microvascular cerebral ischemia, really, some early state of dementia or:
He is doing this on purpose to throw the election to payback Bush and the Republican party for destroying him in 2000. Sarah Palin is ignorant to his agenda, a mere puppet. Christ even the devil himself, Carl Rove finds his behavior and campaigning offensive.
As far as cutting Medicare? This ought to prove once and for all that the man has come unglued. He is literally giving the election away. I had a ton of respect for John McCain once and the POW thing had nothing to do with it. It was his partisanship that attracted me to hm. But now, like the anger or meanness that comes out in Alzheimer's patients which is a reflection on who they really were, has come out in John McCain. I honestly believe he is sick and I hope he gets to keep his VA benefit, a government paid benefit just like the Medicare benefit he wants to derail. Sad, sad man.
Or, they give this one to Obama, and, seeing as he will inherit a disaster, they will come back in 4 years to blame it all on him and get another Repub elected...welcome to the Twilight Zone.
Excellent comments.
I can see it now... An offshore healthcare system, based in the Caymans or Bahamas...
This post is way less effective than your usual, RJ. Maybe my brain has shut down for the day, but I have trouble following some of your argument, which is couched in long, meandering sentences and trains of thought, and when I do succeed in unraveling them, I find that I am unable to care about your point.
If McCain has said "he's going to make up the cost of those tax credits by slashing Medicare and Medicaid," you can win this whole argument and probably the election by citing that quote, with the time and place he made it. Where is that quote?
Perhaps this is a bit less TAXING>>>>
McCain: Cut Medicare
http://yglesias.thinkprogress.org/wp-content/themes/thinkprogress/emailthis.php
YOu don't get it... We PRIVATIZE Medicare and give the POOR OLD BOYS from Wall Street CEO positions there...
Offshore the entire bunch of them, out of this country for 20 years with a minimum of 10 years in Africa...
Through Social Security and Medicare, the baby boom generation has made a $53 trillion dollar promise to itself that the rest of us will have to pay.
The programs need to be cut. There is no way we are going to be able to fund the retirement of the baby boomers and their healthcare expenses, Rx drugs included.
NOBODY KNOWS what MEDICARE WILL COST.... And the cost projections for income and life span that were developed in the 80s were spot on....
If PRIVATE INSURANCE were as well run as Medicare, we would not be in this situation... Medicare balances it's books to the PENNY... Private insurance companies pull stupid Wall Street crap so that the CEOs can rake it in!!!
If we were able to "spot on" predict health care costs in the past, then why is it that you argue "nobody knows what medicare will cost?"
Make up your mind and let me know which way you believe. I would love to discuss this with you.
Do you have a source for the $53 trillion number. The only thing I could find were some articles by right-wing types like Glenn Beck.
Here's the actual 2008 Status of the Social Security and Medicare Programs, A SUMMARY OF THE 2008 ANNUAL REPORTS, by the Social Security and Medicare Boards of Trustees http://www.ssa.gov/OACT/TRSUM/index.html
And here's The 2008 OASDI Trustees Report
http://www.ssa.gov/OACT/TR/TR08/index.html
Nothing in them, that I could find, talks about a $53 trillion number.
You mock Glenn Beck and then sight the governments own numbers?
I appreciate the links. I really do.
I don't know what the numbers were when SSI was first implemented, but come the retirement of the baby boom it will be something like three workers for each retiree. That just isn't going to work.
Generation X is not going to be able to shoulder that burden. Our numbers are not nearly great enough.
"the baby boom generation has made a $53 trillion dollar promise to itself "??
The FACT that Social Security was implemented under FDR - long before Boomers even existed - and Medicare was made law in the 1960's refutes your assertion. SS and Medicare are part of a covenant made between our government and our people and, truth is, the Boomers have kept their part of the bargain by paying for the generations that came before us - and now YOU would have us eat dog food and live in cardboard boxes in our retirement?? At least until we die of exposure or some totally treatable illness....Nice.
You are correct. Seeing as how I went to high school, you didn't tell me anything I didn't already know.
Please keep in mind that changes are made to social security and medicare all the time. It's not like they haven't been touched since first enacted.
I never said anything about you eating dogfood or living a cardboard box. Do statements like that really advance dialogue. I mean really, why bother?
How silly this statement is. Had the government done what it was supposed to do, we would have no crisis. But they could not keep their hands off it and then they turn around and tell us the
system is broken. How about paying back what you had borrowed? We did not call it the war
box but Social Security for a reason. Any other industrialized country has the same system.
Show us how you treat your elderly and we show you who you are. The USA lacks in benefits solely because of the huge defense spending - tell me if that makes any sense. I always said
rather red than dead!
Simply frightening! No plan and grabbing at straws is disgusting. Why is everyone so loathe to speak of Universal Healthcare? If you have money, you will still be able to see any physician you wish! It's not as if all doctors will be involved. Many will opt out for the richer patients. The rest of us will be covered. Better to have some coverage than none at all!
BlueZoo
Sure, if I have money I will be able to go see my doctor. However, I might not have it after Mr. Obama takes the money I currently use, plus some more, to fund a national healthcare system.
Mr. Obama will have to raise taxes AT LEAST by as much as I currently pay for my healthcare plus a sixth more for my share of the 48 million uninsured and . Additional funds will be needed to cover the cost of the new government needed to manage the system.
GEE Whiz. Let us explain this to you again. Private Health Insurance PREMIUMs have a 30% premium built into them...GET IT 30, thirty %...If we replace that with extended Medicare,, there will be a 30% savings... THAT IS THIRTY PERCENT and that will take care of the UNINSURED and UNDERINSURED so that they don't have to go bankrupt or go thru foreclosure....
10% insurance administration
10% provider administration
10% profits...
As an interested northern reader, may I recommend to Huf Post fans, an article in The Nation by Rose Ann Demoro under two names" Our Healthcare System Is Dying "and "What About Healthcare?"The author wishes the people concerned about Wall Street could get as excited about something else .
TO FUND McCAIN'S TAX CUTS HE HAS TO CUT MEDICARE AND MEDICAID FUNDING.
THE OLD, POOR, YOUNG KIDS, AND MENATLLY ILL WILL BE FUNDING McCAIN'S TAX CUTS.
and that is exactly why the soldiers did not have body armor or decent healthcare or other benefits that McCain hhimself had and continues to benefit from....tooo expensive for us whiners.....
Well now I know for sure why McCain doesn't want to talk about his plans. He hasn't got any.
HE'S MAKING IT ALL UP AS HE GOES ALONG!
When I saw the headline I thought it read: "McCain's Erratic Health"
Here's a guy who's had four bouts of melanoma cancer. A growth of some sort on the left side of his face. More than fifty percent of patients with melanoma develop brain metastases. http://neurosurgery.mgh.harvard.edu/abta/mets.htm For patients with a melanoma like McCain's (Stage IIa) who remained free of the disease for the first five years after diagnosis, the probability of recurrence during the next five years was 14 percent and death 9 percent.
McCain has had the best health care in the world keeping him alive, yet he wants to cut health care for the rest of the folk. That's pretty much all you need to know about John McCain.
I couldn't have said it better myself!! "That's pretty much all you need to know about John McCain."
HE MIGHT WANT TO SLASH MEDICARE BUT SOMEONE NEED TO FIND OUT WHETHER HE HAS A REAL PROBLEM WITH THAT LEFT EYE I THINK HE HAS SOME HEALTH PROBLEMS THAT HE IS COVERING UP AND GOD FORBID IF HE GETS INTO OFFICE WITH THEM WE ARE SO SCREWED
Many doctors are now refusing to treat Medicare patients because of low payments. McCain's plan would only exacerbate this serious problem. The Obama campaign need to get the word out. This is an extremely important issue, especially to those over fifty, who the polls show favoring McCain.
The advantage of having younger patients insured is that many do not need treatment and are healthy. That brings in income into healthcare insurance. A benefit of Universal Healthcare Insurance is that many people who are now being dropped because of possible (future) risk, and can not get either insurance or employment because of being uninsurable, will then continue to WORK and thus pay taxes, improving the total tax base, pay social security and Medicare as well as healthcare insurance, versus not paying a cent over a lifetime plus needing transfer payments. With Universal Healthcare we will finally be able to have an adequate insurance premium which will be much less than insurers charge now, the medicine practiced will be between doctor and patient, and there will be price control /oversight. Without insurance, even if a patient can SEE A DOCTOR, that doctor can not treat him/her if expensive medicines are needed or hospitalization/procedures. If the doctor does these procedures he will have to do it pro bono. Usualy the doctor never sees that patient. That is for the doctor lost business and thus lost income. For the patient it is much worse.
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