Thursday, May 31, 2012
Common Sense on Medicare
The question of class warfare has come up on this blog now and then over the years, but some of us have also been writing and thinking about "age-warfare". That is, with the "pig" of the Baby-Boomers moving through the "python" of retirement and old age, a gigantic transfer of wealth will occur from the young and productive to the old and sick. This editorial lays out the numbers in a fairly straightforward and unemotional way. Americans have come to believe that they have "paid for" their Medicare benefits and by God, they're going to get them. The truth is however, something else. The difference between what the average worker pays into the system and what they derive from it is immense, and it is ultimately paid for by the income taxes of those still working. We MUST begin to think rationally about how the medical care of seniors--a group whose aggregate net worth has increased at a rate faster than any other age cohort--is financed. Because a person has avoided the grave does not ipso facto mean that the rest of us should pay for their medical insurance. Medicare MUST be means tested--aggressively--so that young, productive workers are not taxed in order to fund "the good life" for those with sufficient resources.
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3 comments:
"Means testing"?
You mean "to each according to his needs, from each according to his ability"?
Sorry, couldn't resist.
So, us ants who save for retirement, foregoing such necessities as three car garages, media rooms, $4000 mountain bikes and the newest iThingamajig found at the homes of the grasshoppers get the shaft again?
The system is broke just as you and the authors you link to note. But if the system is means tested and my comparative benefits are reduced or I have to pay more out of pocket than my neighbors, will I get any perks? Will I get moved to the front of the line for treatment?
How about this for a fix... everyone gets a set amount of healthcare dollars in their Medicare account upon retirement. When one uses up their personal benefits, that's it.
Sorry Paco, I can't go where you are on this.
1. I'm looking for "do-able" fixes. Your suggestion won't wash in a modern civil society.
2. You appear to be looking at Medicare as something other than welfare. And as this article states very clearly, for much of a beneficiaries life, it is a simple welfare payment, as whatever was put into the system is already used up.
3. I'm suggesting that there be a "medicare deductible" that is based on a sliding scale tied to net worth or some other representation of wealth (this one will be admittedly hard--tracking income is much easier). For the aged poor, there is no real deductible. For the aged well-off, it would be somewhere in the $10-12K annually range. After one has accumulated enough medical care within this deductible range, the "what you paid in" figure THEN comes into play. This keeps even the well-off from catastrophic medical costs, but it recognizes that we cannot continue to piss away good money after bad on well-off, seniors living the good life off of their children's taxes.
If it comes down to tracking income, track it back the entire working career of the individual and make sure that the high earners who pissed it away don't get treated as generously as the working poor. The savers will just have to figure out ways to hide their assets better if it is based on wealth.
But maybe it is a better idea to just not change a thing except to commence a marketing plan continuously reminding the younger generations that it's Medicare and Social Security that are keeping mom and dad from moving in with you. Maybe with that reminder, they won't resent the taxes so much
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