Asymmetrical Information

How would that be a gimmick? The taxpayers of NY are contributing more towards Medicaid because of the State gov'ts policy of forcing the local one to match its spending. If the Federal policy is to match the states then why shouldn't New York get additional money? Especially considering that Blue Staters like NY are still collectively paying to subsidize corporate welfare and subsidies for the supposedly hard working Red States?

NY is not forcing counties to "match" state spending; instead, the state is forcing counties to pay for a portion of the program. One of the problems is that the state sets the standard for what is covered; the counties don't get a say in that. The Feds give the states leeway to set the standards, all the way from minimal coverage to a Cadillac coverage plan. New York opted to provide the Cadillac coverage plan, which is just costing too much. Other states are now facing the fact that Medicaid spending is growing larger than their education spending; New York (thanks to its Cadillac plan) reached that point years ago. Reforming Medicaid in New York should mean reducing some of the benefits. There's no reason why Medicaid should be covering expenses that even the health care plans for teachers unions don't cover.

Forty years ago, Congress, as an afterthought to the Medicare program for the elderly, created Medicaid to help pay for the medical needs of about four million low-income people. Today, the program covers 53 million people -- nearly one in every six Americans -- and costs $300 billion a year in federal and state funds, recently surpassing spending on the federal Medicare program. In some states, Medicaid accounts for one-third of the budget.

Has anyone come up with any workable solutions to reduce this cost?

I assume this post is a joke on your part. It doesn't matter what is done. Socialism doesn't work. Never has. It will all end in ruins for the Americans left holding the bag.

I assume this post is a joke on your part. It doesn't matter what is done. Socialism doesn't work. Never has. It will all end in ruins for the Americans left holding the bag.

Seriously, I’m not a fan of Medicaid, Medicare or Social Security but that fact that I don’t like either of these programs doesn’t negate the fact that they exist and they will continue to exist for the foreseeable future. Like it or not, there is a political consensus that believes that there should be some sort of “safety net” at the federal level when it comes to providing health care for the poor.

I don’t agree with that consensus and would like to change it. The way to do it is to (a) try to stop or minimize the expansion of the existing programs, (b) trim them back where you can, and most importantly IMO (c) create a better alternative as the POTUS is trying to do with Social Security reform so that free market/limited government advocates are not stuck in the untenable position of trying to fight something with nothing.

That’s how you make progress in a small “d” democratic society where you have to deal with an undecided middle that could swing either way. You make changes incrementally and within the consensus while trying to persuade people and ultimately change that consensus so you can make further progress.

So I’ll ask it again, does anyone have any constructive suggestions for how to minimize the cost of Medicaid?

Thorley,

The only I can think of is to vote for a Dem president so long as the GOP controls Congress and vice versa.

I feel two issues are confused here. (perhaps because I could not follow the link).

Medical care in the United States has become mind-bogglingly expensive. But this is true of private insurance and this is true of public insurance.

Those studies I have seen suggest public insurance has much lower administrative costs due to scale and the absence of a sales function. My understanding of the Medicare law was that we have to bribe private insurers to compete for Medicare patients.

Let's not confuse the issue by implying that the challenge with health care is government inefficiency.

Tom

Tom, it is government inefficiency. The only reason private corporations have to be "bribed" is because they are rarely fully compensated for their treatments ... and even if they, the payments takes months and sometimes years to process.

Now if we restrict medicare and medicaid eligibility and give the participants a vocher that can be used at any public/private insurance company ... corporation won't need to be bribed and money will be saved.

My one size fits all medical care reform package:

1. Dedicated tax to fund universal coverage (take your pick, sales tax, income surcharge, value added tax etc.).

2. Tax revenue divided by population = voucher.

3. Vouchers can be redeemed for...
a. Medical Care.
b. Medical Insurance.
c. Cash against employer provided insurance.
d. Donated to charity or to other people's care.

4. In order for insurance companies to redeem vouchers, they must agree to take everyone and charge premiums that are nearly equal.

5. People are free to supplement the vouchers with their own spending either buying medical care for cash or buying private insurance.

6. Those who do not use their vouchers to buy insurance and who become ill (I'm thinking of the crazy homeless person o nthe street) will go into a pool where insurance companies will bid to provide coverage.

Here you get universal coverage without an entitlement. If people desire more insurance they must accept higher taxes, if they want lower taxes they must agree to cut their benefits. The private market is free to compete as well.

I've been maintaining for some time that the US spends more public money, per capita, on medical care than any of the "socialist medicine" countries. I don't have any solid proof of this, just a hunch. Another hunch tells me that Americans actually have more medical services available to them than any citizens of countries with fully socialized medicine. If true, this would illustrate that the answer to high health care costs and any lack of availability of services is not to socialize medicine. The only reason that countries with socialized medicine spend less is that they deliver markedly lower quality health care. Our system is incredibly and unnecessarily expensive, but at least it delivers.

Sorry, there's no way to stem the rising costs of health care for everybody without addressing both the supply and the demand side of the equation.

Thorley,

My comment says it all. It doesn't matter what is done to "save" medicaid, SS, medicare, or any other welfare program. Not to mention most of the corporate retirement programs in place. Talk/plan all you want but the rot has already set in. Whatever is done will fail. Socialism doesn't work. It can't work. Read some history, find any government and observe that they all fall apart over socialism (socialism = equal outcomes for nearly all citizens). Sometimes it takes time for the erosion to complete but it always happens. The only long-term successful system is Adam Smith capitalism where 85% of the people enjoy decent lives and 15% don't because of their stupidity, infirmities, sloth or whatever. The socialistic idea that somehow the 15% can be uplifted by the other 85% always fails.

You know, it's ironic that people like Jack Wayne presume to lecture us that we need to read up on the history of socialism when it is clear they don't even know what the word means. Hint: It's not the same thing as welfare Jack!

Socialized medicine is a bad idea for several reasons.

First, medical advancement will proceed more quickly if profits come from coming up with better ways to please actual patients, rather than bureaucrats. This is a failing not only of all possible "national healthcare" schemes but also our current system whereby our employers pick our policies for us without being themselves covered by them. Our lives ultimately depend on medical research - we are all suffering from a degenerative terminal illness known as "aging" for which there is not yet a cure, and finding a cure would rate among the biggest advances in all of human history.

Second, socialized medicine will inveitably lead to a conflict between people who think the state should leave them to take their own risks with such things as cigarettes, tasty food, and dangerous hobbies, and people who are stuck paying the bills for others regardless of the idiotic risks they take. This will lead to escalating costs, increasingly oppressive prohibitionary laws, or both. Over the long term, people can't be free to choose their own risks when others are paying the bill, or those others will get screwed. I'd rather be free and pay my own way. Wouldn't you?

Ken,

If you have time please read thru my proposal and let me know:

1. Would you consider it socialized medicine?

2. How would it cause the negative effects you mention in your post.

Actually, Boonton, it is! Show me a welfare state and I will show you socialism. Show me socialism and I will show you welfare. Any time you have a government taking money from one set of people and giving it to another for political reasons, you have socialism/welfare. I.E., they are the same and pedantic definitions don't hide the fact. And, I wasn't being as rude as you. I am suggesting that a study of history will confirm that most if not all governments fall over socialism. I.E., a study of history may well be a study of socialism but not in the condescending manner you use.

Boonton, thank you for something constructive!

All this hot air and pontification about socialism is not helpful. You can't make any claims whatsoever without an honest, fact-based (rather than ideology-based) comparison with the existing "socialized" schemes in other countries. You can come up with all the theories you want to about why it works or doesn't but it's all just blabber when there are real results out there (lots of them!) we could be looking at instead.

Back to Boonton: I like the idea. A couple of questions though:

1) Assuming that a black/grey market for vouchers would arise, would not poorer people simply sell their vouchers to make the same trade-offs they make now between healthcare and food/rent/school/utilities?

2) I don't understand your point #6. How would that pool work? Can you elaborate?

so, jack, what's your point then? If all states which give welfare are socialist, and you say all socialist states fail, why do we still exist?

why does any country on earth today exist, for that matter?

I mean, seriously, you're just making stuff up.

"4. In order for insurance companies to redeem vouchers, they must agree to take everyone and charge premiums that are nearly equal."

This is guaranteed to cause problem #2 as I listed them above. You cannot embrace risk under this rule without driving everyone else's costs up, since these insurance companies must charge everyone nearly the same rate.

"Here you get universal coverage without an entitlement. If people desire more insurance they must accept higher taxes, if they want lower taxes they must agree to cut their benefits."

You can't unlaterally raise or lower your taxes or benefits, the way that you could if everything was private. You're at the mercy of all of your fellow citizens to decide for you how much insurance you'll buy and at what price, and they won't be subject to the same incentives that you would and would, in nearly every case, make a decision that does not fit your circumstances nearly as well as your decision would.

As for problem #1 as I listed them above, what gets covered? Who decides? The customers, who flock to a new offering if they consider it worth their own money, or the plan administrators, who are buying stuff for strangers and not for themselves? Innovations that customers consider useful will be more strongly rewarded in the first case than in the second, and your plan falls firmly in the second case.

Amazin'

They exist as long as the government can extort money from the citizens. When that fails the government falls. A new government is shortly constituted maybe with the same errors as the last but that is where governments come from. As for making it up - where does the shortfall in all of the government programs come from? It is poor economic decisions coupled with the governmental power to extort money. If you accept that SS is a stone's throw from insolvency why do you think I am making stuff up?

Jack,

Without evidence, I can't accept most of the things that you've stated as fact or taken as a given. Sadly, this leaves us with very little ground to argue over and we are stuck:

1) I reject your implication that taxation (with representation!) is the same as extortion.

2) I reject your claim (from your "historical observations") that the primary cause of historical government failure is socialism.

2b) Please also find for me an example in history of a hard-line libertarian society which proved itself viable (note: it doesn't count if it depended on slave labor for survival).

3) I reject your implication that all government programs must have a shortfalls. Even the dreaded social security shortfall does not actually exist yet. It's projected. Simple (yet perhaps distasteful) measures could, and I expect *will*, be taken to avoid insolvency.

Mike,

Can you support your statements / provide a study supporting them?

My understanding is that private insurers will not take Medicare patients for the cost that Medicare incurs to serve them.

Every study I have ever seen concludes that Medicare is at least as if not more efficient than private insurers.

A quick search gave me this one: http://www.urban.org/urlprint.cfm?ID=8297

Tom

1) So you reject the note taken by the founding fathers and de Toqueville that as soon as the majority started voting itself treasury money that the government would be in very serious condition? I remember the phrase "Majority rules; minority rights". Taxation with representation can very well be extortion.

2b) Explain to me the fall of Rome, Athens, China, Japan and any other society that you care to look at. When I look at those governments I see virtually the same thing: complete government control of labor, production, distribution. All controlled by a well-paid army. Show me where we are any different in principle. The army control is less obvious. But the control of labor, production and distribution in 2005 US is well-documented.

2b) The US from 1792 to 1908. Teddy started us down the path to socialism and Franklin finished it. (For me, the US government "fell" and was re-constituted as something different under Teddy.)For an example of a capitalistic (I reject your demand to provide a Libertarian) society, take a look at Rome in the early days before the Caesars, Athens before the militaristic period. I reject your idea that slave labor is inconsistent with capitalism. Most governments from time 1 used some form of slave labor. Your definition (turned on its head) implies that all governments have been socialistic. But slave labor is not cost-free so your implied cost-free argument is a non-sequitur. I.E, I am sure that any society that depended on slave labor would not be in existence for long. Depending on slave labor is what killed Rome.

3) Answering 3 is very long but I'll try to be brief. If we don't agree that there is a shortfall in SS, then we have no argument. You have your religion and I have mine. If we do agree, then I say that the insolvency will happen as follows: First we have to agree that there is no trust fund. If you believe there is money sitting in some government vault then we have no argument. So, we must agree that SS is a pay as you go system. In 5 years (yes, 5 years) the curve will trend down if you plot income versus outgo. In approx. 2018, outgos are bigger than incomes. Here is the crisis. At that time, funds from other government income must supplement SS outgos. There are 3 solutions: raise the limit of income to tax, raise the tax or raise the retirement date. I think all 3 are non-starteers in our socialistic society. But let's really think about these "solutions". We have agreed to this pont that there is no trust fund, SS is pay as you go. So, tomorrow we raise the income limit, collect more money in 2005. And spend it all. Oops. Ok, let's raise the SS tax. Oops. Same story; money gets spent this year. OK, let's raise the retirement age. Remember that the original plan had retirement at average death plus 2 years. So, we raise the retirement age to 80. That certainly gets us past 2018. Maybe even past 2042. But a LOT of people are pretty angry. Pretty much the baby boomers get screwed to save younger workers. In my origianl post I said that you can have a workable society if 15% of the folks don't do as well as the other 85%. So, under this plan, we are going to screw over folks who have worked all their lives? I don't think so. This is the rot. Once you start down the path to socialism the only way out is to hit rock bottom, screw over a bunch of people and start over. Try selling that to a risk-adverse Congress. TNSTAAFL.

mike, you said "The only reason private corporations have to be "bribed" is because they are rarely fully compensated for their treatments ... and even if they, the payments takes months and sometimes years to process.". You do realize that you are describing exactly what private insurance companies do to doctors, don't you?

Jack Wayne knows next to nothing about history and just cherry picks things to attempt to support his case. The truth is that to refer to almost any society of the ancient world as being equivalent to modern capitalism is only vaguely accurate. In addition to be brutally honest the capitalist philosophy of Adam Smith hasn't been around long enough to qualify as a really long term example.

Ken, the problem with the standard conservative argument that everything would just be okey-dokey if we'd just make it so every individual who can afford it would have to shop around (ignoring those who can't afford it) is that there must be a rational basis on which the decisions are made. For that basis to exist insurance companies would have to provide agreements and other documents that can be understood readily by people who aren't lawyers or other specialists in legal and medical terminology. They aren't going to do it. Competition isn't in their interest and they'll just take part in a form of unprovable collusion. Shopping for doctors or hospitals? Need I point out that by the time you find out you've made a bad decision in this it's too late? What source of information is there that would allow people to actually shop around for medical professionals? Seriously.

Nice snarky comments, Jim S. Do you have anything real to add to the thread? Your response to Mike is saying that you agree that the market is twisted around tremendously. But you blame it on insurance companies. Here in Texas the insurance companies are tightly regulated. To imply that they are doing as they want (pursuing happiness?) is incorrect in my view.

For me you dismiss my screed without adding anything except your dismissive comments. And you misquote me also. No need for me to reply to that.

And to Ken you follow the usual Liberal line that folks are stupid and cannot make good judgements. I could ask Where do you stand on 15-year-old girls deciding on abortion? But that's a little too much for this thread isn't it? However, I can say that I have picked my insurance based on price and coverage. Within the confines of government regulation, insurance companies do compete. Finally, you imply that bad decisions are something that should not happen to folks. Sorry, Jim, happens all the time. And there's nothing wrong with there being winners and losers. It's life. Which is something that socialists appear to know very little about.

NY and CA, unlike other states, have always aksed their counties to come up with half the required state spending on Medicaid. The way Medicaid works is that first, the state has to write a check to pay the provider of health care, and then the state asks the feds for the match. So Medicaid can be a significant cash problem for states. I suspect that NY and CA ask local government to share in the cost because of their large size and historical political issues between big cities and rural areas. Anyway, in recent years states have ripped off the feds by hugely overpaying county and city hospitals and nursing homes, claiming the match from the feds, and then requiring the local governments involved to kick back the excess payments, leaving the state government free to spend the extra federal dollars on whatever. That is what has the feds pissed off and has nothing to do NY and CA's longstanding policies of requiring counties to share in the cost of Medicaid.

"1) I reject your implication that taxation (with representation!) is the same as extortion. "

Wrong. You can keep your head in the sand as much as you like, but taxation (the taking of money from an individual by the government) is
extortion as long as I do not wish it.

If you, me and Jack Wayne (for example) lived in a country, and we both vote to take your money (against your vote), we'd of course call it a "tax", does that make it right? According to your logic, it is not. After all, you are "represented".

This is separate from me using necessary government services, which I will gladly pay ONLY for which I need. Roads, police, judiciary, defense.

1) Assuming that a black/grey market for vouchers would arise, would not poorer people simply sell their vouchers to make the same trade-offs they make now between healthcare and food/rent/school/utilities?

That's a possibility although I think the vouchers will mostly be used for insurance they will be less easy to dump into a black market.

2) I don't understand your point #6. How would that pool work? Can you elaborate?

Basically a little like a default long distance carrier if you fail to specify one yourself. Those who fail to use their vouchers will have insurance purchased automatically for them by insurance companies bidding on coverage. That way a homeless person who never gets mail can go into an emergancy room with some type of coverage.

What happens now is that we are forcing the wrong people to pay for universal coverage. Hospital emergancy rooms are required to eat the cost of those who have no coverage & cannot pay for needed care. We have basically decided that no one will be denied some minimum amount of necessary care, isn't it fair that we all pay for it thru taxes rather than just trying to stick a few hospitals with the bill???

I am suggesting that a study of history will confirm that most if not all governments fall over socialism. I.E., a study of history may well be a study of socialism but not in the condescending manner you use.

Socialism is collective ownership of the means of production...that's another word for capital and capital are the goods used to make other goods & services (like factories, machines, tools, railroads, etc.). A classic socialist policy would be for the gov't to nationalize the railroads or coal mines. The logic behind this was that these things were being run for a profit by capitalists. Gov't could run it at a breakeven level (or even a loss) and use the socialized profits to increase wages or decrease prices.

Welfare programs are a much older idea that go back to the Jamestown colony in the US and before in Europe. They have nothing to do with who owns capital but simply extend aid to those who need it the most. Welfare and the welfare state carry a host of dangers with it, primarily being the danger of creating perverse incentives. But it is a totally different idea than socialism.

Socialism itself doesn't particularily see the need for welfare. If you read anything historical documents by Marx, Engles or Lenin you would see that they believed all poverty was caused by capitalism and changing that would eliminate the need for any type of welfare except maybe for those who are totally unable to function due to extreme handicaps.

This is guaranteed to cause problem #2 as I listed them above. You cannot embrace risk under this rule without driving everyone else's costs up, since these insurance companies must charge everyone nearly the same rate.

In other words insurance coverage means we are paying to take the risk from individuals and allocate it collectively. What becomes a possibility of an individual being ruined by an uncertain illness becomes a predictable expense that covers him. Insurance fails when you can predict outcomes for individuals. Homeowners insurance, for example, wouldn't work if there was a way to know whose house would burn down next year. The insurance company would charge that guy thru the nose for coverage and everyone else would know they could get away with not buying coverage.

As for problem #1 as I listed them above, what gets covered? Who decides? The customers, who flock to a new offering if they consider it worth their own money, or the plan administrators, who are buying stuff for strangers and not for themselves? Innovations that customers consider useful will be more strongly rewarded in the first case than in the second, and your plan falls firmly in the second case.

Individuals would. Want to have no restrictions on your doctor? Buy a plan with your voucher that does that. Want abortion not to be covered? No doube a company will create a 'religious' plan that doesn't cover contraversial things.

The only administrating that would be done is deciding what is really a medical plan versus something else. There is going to be some potential for mischief here but its a lot less than the current system where Medicare/Medicaid administrators must decide not only what procedures are covered but how much to pay for them.

Ken's analysis of SS is also deeply flawed.

1. In 2018 the gov't could simply borrow the short fall if it materializes. This seems quite fair since right now SS is running a surplus which has the effect of reducing borrowing.

2. The SS Deficit is projected to be around 2% of GDP. Small potatoes when you consider we are not blindly running deficits of 4% of GDP (which includes the SS Surplus!).

3. Trivial benefit adjustments (such as making initial benefits slightly less indexed to wage levels (rather than de-indexing them entirely)) can keep SS in balance basically forever.

some of the problem with health care costs is that modern engineering approaches, like 6-sigma, to eliminate errors haven't really reached health-care. until there is more quantitative approach to tracking costs, errors, and value of health care received, it will be difficult to improve. commercial flight would be very dangerous if jet engines had failure rates like medical care does.

and if we anticipate an increase in the demand for health care, with the ultimate costs picked up by the taxpayer, isn't the proper solution to increase supply - i.e. train more young american doctors?

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