Does Medicare Need $4.92 Band-Aid? : Now’s the Time to Discuss a Rational National Health System

Is it churlish to express reservations about the proposed new health-care coverage for the elderly? The answer depends on whether one thinks that reason and good sense will ever be applied to our health-care system. If not, perhaps the elderly should take what they can get when they can get it. For the moment, Republicans and Democrats appear to be joining in a bipartisan rush to enact some version of the Administration’s plan.

The main criticism heard so far has been how limited the plan for catastrophic coverage is. For $4.92 a month, the proposal would expand Medicare to provide unlimited hospital days and pick up other hospital-related costs over $2,000 a year. In fact, it is estimated that less than 5% of the elderly would use the extended protection in a given year, which accounts for the insurance industry’s complaints that they do and can offer the same coverage.

The elderly are more concerned about not being able to afford at-home care after leaving the hospital, and not being able to pay for drugs. Many say that they choose every week between paying for food or heat, or for drugs a doctor has prescribed. The proposed plan would leave them $4.92 a month less to choose with. The elderly are also concerned about having no protection against the cost of nursing-home care, which averages $22,000 a year. The Administration argues that money is not available for drugs or at-home care and least of all nursing-home care.

A largely overlooked issue is who should pay for catastrophic insurance, if we are to have it. The Administration’s plan selects an expensive risk group--the aged--for coverage and asks them to pay for it themselves. In contrast, Medicare spreads the cost much more widely, that is, to virtually all employers and employees. Does the cost to the aged person of $4.92 a month sound trivial? Not to an aged person. Moreover, when costs prove to be higher than estimated, the premium will be driven up and the elderly will bear the additional cost themselves.

A deeper issue, uncomfortable to face, is rationing. Large infusions of money into health care such as in the proposed plan are, in effect, decisions to ration health care, drawing physicians, hospital beds, medical technology and research to the population covered by Medicare and away from others. Surveying health care in the United States today, it would be difficult to conclude that the elderly--serious as their health needs are--are in the most trouble.

The rest of the population has no program resembling Medicare. Thirty-seven million younger Americans, almost one-third of them children, have no health insurance. Among women 18 to 24 years old, who account for 40% of all childbearing, one in four has no form of health coverage. In its budget for 1988, the Administration proposes to spend $85 million to combat infant mortality, but to cut $1 billion from Medicaid. Merely to mention one effect, the cut would overwhelm the Administration’s infant mortality measures. If we were limited to enacting a single measure at this point, chances are it should concern the families of the unemployed or families with young children.

An underlying issue is whether the United States will continue to treat a chaotic system of health care by adding an expensive appendage here and a patch there. The cost alone should deter us. With national health insurance, for example, Canada’s cost increased by 17% (as a percentage of GNP) between 1970 and 1984, while costs in the United States went up by 41%. Or, consider the British National Health Service. In 1984 Great Britain was spending $400 per person for health care while we were spending $1,500 per person. Ironically, part of British savings lay in having less bureaucracy.

One naturally wonders whether people in countries like Canada and Great Britain are getting as good health care as we; answers quickly escalate into polemics. Let it be said that comparing life expectancy and infant mortality rates does not suggest any advantage to the United States. Cost is not everything and, within limits, not the main thing, but it is also worth reflecting whether at this point in our history a national system might work better for us in other respects as well--in more equitable availability to all population groups and in reducing the patient’s feeling of being pushed around--by insurance companies, by employers, and all the rest.

Those who believe that we will never be rational about health care may want to push ahead with a version of catastrophic insurance for the elderly. At least the cost should be laid on Medicare and not on the elderly. On the other hand, with a Democratic Congress and a Republican Administration, in the next two years great things are not going to happen in health care. It may be a good moment for congressional hearings and public forums to look into the merits of a national health system.