Don't Take it for Granted - The Commonwealth Fund

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Commentary on The Commonwealth Fund/Modern Healthcare Health Care Opinion Leaders Survey on Health Reform by Bruce Vladeck, senior adviser at Nexera.

Just as in 1993, when the architects of health reform initially took Medicare for granted and then scrambled to address beneficiaries' concerns, Washington finds itself caught up in the fog of hysteria, misinformation, anxiety and downright dishonesty that so often afflicts Medicare politics.

By many measures, including beneficiary satisfaction, Medicare works substantially better than any other part of America's health insurance system, so reformers tend to take it for granted. After all, Americans 65 years old and over have essentially had universal coverage for more than 40 years. On the other hand, Medicare's projected future costs terrify budget wonks, and they don't have any good solutions. Further, Medicare beneficiaries vote at a much higher rate than other Americans, but many don’t understand the program very well themselves. So the preconditions for a political meltdown are fully present.

In this context, it's important to start with a few basic truths. The most serious problem with Medicare—which no one wants to talk about—is that its benefits are inadequate. The much criticized "bronze" option in the Senate Finance Committee bill would cover 65% of a household's expected healthcare expenses. Medicare covers less than 60% of beneficiaries' healthcare costs, despite average incomes only half as great as those of the nonelderly. This problem is exacerbated by the accelerating disappearance of retiree health insurance, which filled much of the gap for as many as 40% of beneficiaries little more than a decade ago.
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