With the collapse of choice and competition in the Obamacare health insurance exchanges, combined with major premium and deductible increases, “progressives” in Congress are looking for new ways to expand the role of government in Americans’ health care.
Progressives’ current thinking: Use Medicare to entice millions into a government-controlled health system. By relying on even more extensive government control to fix the problems created by an excess of inflexible government regulation, the outcome would be no surprise. More of the same: fewer choices, higher costs—and an expedited route to the final death of private health plans.
Sens. Jeff Merkley, D-Ore., and Chris Murphy, D-Conn., recently introduced the Choose Medicare Act. The bill would create a “Medicare Part E”—a new program of government health plans that would enter the individual and small group markets, as well as the large group market, which serves large private employer-based insurance plans.
Under the bill, Medicare Part E plans would be defined as “qualified health plans’” under the terms and conditions of Obamacare. They would provide all benefits and services required under Obamacare, plus benefits required under traditional Medicare.
The new program would also require taxpayers to fund abortion coverage, and it would prohibit states from enacting restrictions on abortion coverage in the Medicare Part E plans.
In other words, it would reverse current law, which has enabled almost half of all states to “opt out” of health plan coverage of abortion in the health insurance exchanges.
The federal government—through the secretary of health and human services—would set the new plans’ premiums, as well as payment rates for doctors, hospitals, and other medical professionals based on Medicare payment rates.
The bill reads:
The secretary shall negotiate the rates … in a manner that results in payment rates that are not lower, in the aggregate, than rates under title XVIII, and not higher, in the aggregate, than the average rates paid by other health insurance issuers offering health insurance coverage through an exchange.
In other words, Medicare rates would become the new floor for payments in the new Medicare Part E plans. This would give the secretary the power to manipulate payment rates, as well as premiums, for Medicare Part E plans, enabling the secretary, state by state, to undercut private health plans and drive them out of the market.
Securing the objective of government monopoly in the Obama-battered individual markets should not be too difficult, since 52 percent of U.S. counties now have only one insurer anyway.
Medicare payment rates for doctors and other medical professionals are routinely lower—often much lower—than health plan rates in the private market. The bill thus includes a pre-emptive cure for any potential lack of enthusiasm among doctors who might not wish to participate.
The bill specifies:
A health care provider that is a participating provider of services or supplier under the Medicare program under title XVIII on the date of enactment of Choose Medicare Act shall be a participating provider for Medicare Part E plans.
In other words, Medicare doctors would automatically participate in this government-run health plan whether they like it or not.
Unlike most private insurers, the new Medicare plans would have the full backing of the federal government, meaning the taxpayers would assume the financial risks and be saddled with covering any program losses.
Because the bill does not establish any separate Medicare Part E trust fund, the new program presumably would be integrated financially into the Medicare program itself. As a political matter, Medicare Part E plans would become too big to fail.
As noted, Medicare pays relatively low rates to doctors and hospitals, but the program is not cheap. As the Congressional Budget Office has warned repeatedly, Medicare spending is generating major deficits and debt. As of 2016, Medicare accumulated huge long-term unfunded obligations, ranging between $32 and $44 trillion, depending upon the assumptions. The Senate bill would doubtless add to those large and growing taxpayer obligations.
In the “Medicare for All” bill (S. 1804), introduced last year, Sen. Bernie Sanders, I-Vt., and leading Senate “progressives” called for the outright abolition of all employer-sponsored health insurance. This would be a politically unpopular proposal.
The co-sponsors of this new bill—all of whom were original co-sponsors of the Sanders bill—decided they could accomplish the same objective by tempting employers to drop coverage.
The obvious logic: If the taxpayers are going to pick up the tab for employee health coverage, why should employers continue to offer and finance health insurance? Companies would, understandably, better their bottom line by dumping workers and their families out of their existing coverage and into the government program.
For employers, the temptation could be irresistible. Under the bill, the statutory cap on income eligibility for the generous Obamacare subsidies would increase from 400 percent of the federal poverty level to 600 percent—in today’s dollars, $72,840 for a single person and $150,600 for a family of four.
Make no mistake, the purpose of this bill is not to enhance your choices or competition among health plans, it is to destroy both. It is not to promote a diversity of health plan options, it is to secure government-enforced uniformity. If you don’t like what you get, that’s tough.
Progressives want a bureaucratic edifice of coercion and control in your health care. Their tacit assumption: They know better than you what is best for you. You’ll just have to learn to like it.