MEDICARE REFORM: More Pressing Than Social Security

Writing in today's Washington Times, former Delaware Gov. Pete du Pont warns of the danger of reforming Social Security while ignoring the even-larger problem of Medicare insolvency. Du Pont argues that Medicare is plagued by four unique problems that do not affect Social Security:

While Social Security will not go bankrupt until 2013, Medicare's outlays already exceed its revenue.
Medicare payments go to service providers, who decide how the money is spent, while Social Security payments go to beneficiaries, who decide how to spend it themselves.
There is no hard cap on Medicare payments, while Social Security payments are fixed.
"Every Medicare beneficiary has his or her own definition of medical care needs, whereas every Social Security beneficiary has the same definition of what money is."

When today's eighteen-year-olds retire, Medicare will consume 16 to 20 cents in taxes out of every worker's dollar. The government will be forced to "[s]queeze the doctors, hospitals and other providers of health care," while rationing patient care to an even greater extent. But, du Pont argues, "[t]his approach overlooks, and harms, the most important element: the patient." His solution is to scale back Medicare to a system of catastrophic health insurance "instead of simply prepaying for health care." He concludes: "A vastly scaled-down Medicare program could be the insurer of last resort. Health care decisions should be in the hands of the patients themselves, aided by their doctors" (12/23). This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.