The Morning Show January 18 – 22

3 Responses to The Morning Show January 18 – 22

1. Shade says:

   January 17, 2016 at 5:39 pm

   Re your statement above: “I also suspect her cynical strategy of scaring voters into thinking that Sanders’ healthcare plan could lead to some folks losing Obamacare has succeeded – at least in the short run”.

   Bernie didn’t help his cause this morning when I heard him on one of the talking head shows. Benie said “Sometimes where the discussion becomes really absurd is that we will increase Medicare premiums, that is true. But we are doing away with all private health insurance premiums…”.
   http://www.washingtontimes.com/news/2016/jan/17/bernie-sanders-hillary-clinton-sounding-republican/

   That statement by Bernie alone caused a lot of seniors to stop listening at the point Bernie said Medicare rates would go up. Though often unwise, seniors often pay for no other coverage. I suspect that what Bernie may have been trying to say is that yes more Medicare premiums would be collected, but this would be due to the fact that more people would be receiving the comparatively inexpensive coverage instead of paying the inflated rates for what they currently have. If that is what Bernie meant to say he said it extremely poorly. Truth be told, Hillary is the more artful speaker.

   It is my opinion it would be better politics if Bernie would propose to gradually phase in Medicare coverage For All at close to current Medicare premium rates. Bernie should also make it clear that regardless of what it ultimately costs to cover the new beneficiaries, the formula to determine Medicare rates for seniors (and the disabled) would be separately determined and by law their rates could not be detrimentally affected.

   Bernie will also need to clarify that Medicare doesn’t cover everything and isn’t likely to for some time. Under current law, Medicare is just a guarantee of reasonably priced primary coverage (with free “extra help” subsidies or Medicaid also available for those with low income and resources). As with current Medicare beneficiaries, most beneficiaries would still need to purchase (comparatively inexpensive) MediGap & “Medicare subsidized” prescription drug coverage from private insurers (again unless you qualify for free “extra help” subsidies or Medicaid). Alternatively as with the current Medicare program, a Medicare HMO/PPO “Advantage” plan could be selected that works with Medicare to provide more comprehensive coverage (usually at a more reasonable cost).

   As with the carbon tax, I preach moderation in the proposed implementation of Medicare For All. Get the camel’s nose under the tent & gain acceptance. Try for the whole ball of wax all at once and there is too high a risk of rejection/failure/disaster.

   Reply
   • Shade says:

     January 18, 2016 at 1:02 am

     On reflection, my suggestion that the Medicare Premium rate for younger beneficiaries be initially set the same as for current beneficiaries was not realistic, making it even more important that Bernie make it clear to existing Medicare beneficiaries that their premium rates will not be affected but will instead be separately calculated in the same way as before.

     Why can’t the rates be the same? Because Medicare Part A “Hospital” (inpatient) coverage is offered to most seniors for free, but its actual cost to the government is in the neighborhood of what it costs those that don’t have ten years paying into the system – currently $411/month. (BTW, those with higher incomes now pay $389.80/month for this coverage, which is a similar amount.)

     Part B (“Medical” outpatient) coverage currently costs most new Medicare beneficiaries $121.80 per month. Up until this year (when some fancy budget juggling occurred), by law this is a rate set at 25% of what it costs the government to provide the coverage. For the purpose of this discussion this remains close enough to work with. Thus we can figure the true cost of Part B (Medical outpatient) coverage is in the neighborhood of $500/month.

     Part D (Prescription Drug) coverage now typically costs over $40/month. After the yearly deductible these plans typically cover drugs listed on their formulary typically by paying 75% (you pay 25%) – up to a “donut hole” of non-coverage (with 95% coverage after that). The actual cost to provide the coverage can be approximated by the amount those with higher incomes must pay for this coverage, currently $72.90/month (for the Income Related Monthly Adjustment Amount) plus the price most pay for a plan – about $40 /month. Thus the actual cost of a typical Medicare prescription drug plan is approximately $112.90/month.

     So here is an approximation of the true costs of providing coverage to current Medicare beneficiaries:
     Part A Hospital Inpatient $411/mo
     Part B Medical Outpatient $500/mo
     Part D Prescription Drug $112.90/mo
     ————————————-
     Total cost of Medicare coverage prior to Govt subsidy = $1000/month (approximate)

     However, keep in mind that Medicare currently covers what are some of the oldest & the sickest in our society, so premiums for younger beneficiaries should not actually need to be this high. However, also keep in mind that Bernie appears to be proposing to offer “Medicare For All” as being the only necessary medical expense each month, and currently Medicare is not that at all… at best it usually will pay 80% of covered services.

     For the above reasons, I certainly stand corrected in initially suggesting that Medicare be offered to the new beneficiaries Bernie would bring on at premium rates similar to what current beneficiaries pay. The $121.80/mo plus $40 for a drug plan “on average” would clearly not be enough. That being the case, it is even more important that Bernie go out of his way to assure current Medicare beneficiaries (and future seniors) that by law, the new beneficiaries would have no negative effect on the heavily subsidized Medicare rates most seniors currently pay.

     To determine the premiums the new younger Medicare beneficiaries might be expected to pay, perhaps the best we might initially hope for are monthly premiums similar to what Obamacare participants now usually pay (often a tax-credit subsidized rate). Where the savings of a “Medicare For All” versus current private insurance might first be offered is with more comprehensive coverage, lower deductibles, and fewer out of pocket expenses.

     Reply
2. Shade says:

   January 18, 2016 at 2:21 am

   Need an edit button: Eliminate this line about Medicare Part A as follows from the above:
   “(BTW, those with higher incomes now pay $389.80/month for this coverage, which is a similar amount.)”
   There are currently no higher Part A premiums for those with higher incomes.

   Reply