Tag: "Medicare"

Whose Life Is It Anyway?

Lewis Randall, Norman Rogers, and Brian Hall don’t want to join Medicare. It turns out they don’t have to, as long as they are so wealthy they can agree to forgo all of their Social Security benefits and return any benefits they have already received.

According to the Institute for Health Freedom, Social Security regulations state that:

Individuals entitled to monthly [Social Security] benefits which confer eligibility for HI [Hospital Insurance] may not waive HI entitlement. The only way to avoid HI entitlement is through withdrawal of the monthly benefit application. Withdrawal requires repayment of all RSDI [Retirement, Survivors, and Disability Insurance] and HI benefit payments made. [Emphasis added]

Yet this is inconsistent with the text of Sec. 1803 of the 1965 Title XVIII amendment to the Social Security act, the amendment that created Medicare. It says:

Sec. 1803. OPTION TO INDIVIDUALS TO OBTAIN OTHER HEALTH INSURANCE PROTECTION: Nothing contained in this title shall be construed to preclude any State from providing, or any individual from purchasing or otherwise securing, protection against the cost of any health services [emphasis added].

So, what can you do? Sue, of course. With help from the Fund For Personal Liberty, the three plaintiffs plan to sue the federal government for the freedom to choose their own medical care in old age. The case is expected to be filed this month in the U.S. District Court in Washington, D.C.

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Oct 23, 2008 | 6 comments | by

Hatch Health Bill

The Family and Retirement Health Investment Act of 2008 (S.3626) has been introduced by Senator Orrin Hatch. The full text of the bill is here.

Here is a summary of what is in the bill:

Purchase of Any Health Insurance with HSA Funds Allowed. Allows anyone with funds in an HSA account to pay the premium for their HSA-qualified policies regardless of their circumstances. Under current law, people can only use their HSA account to pay for health insurance premiums when they are receiving federal or state unemployment benefits, or on a COBRA continuation policy from a former employer.

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Oct 21, 2008 | 3 comments | by

One Way to Reform Social Security

This is from a column by Scott Burns and Larry Kotlikoff.

Part B premiums for Medicare are deducted automatically from the Social Security checks of seniors. But if health care costs continue to grow faster than consumer prices generally, Part B premiums will reduce the real value of Social Security over time.

Take an average-income couple, age 30.  Medicare premiums will be $12,151 by the time they reach age 65, and $21,146 by age 85 (all at today’s prices).  As a result of the implied reduction in Social Security benefits, the couple will have 23% less discretionary income during their retirement years.

Oct 01, 2008 | 2 comments | by

Aging Trumps Health Cost Growth as the Main Cause of Future Misery

This is from Andy Biggs' American Enterprise Institute paper on the causes of our future entitlement spending crisis:

  • A new consensus on entitlement reform has developed in Washington: rising per-capita health care spending is the only real crisis besetting the government's entitlement programs, while America's aging population and Social Security play minor roles at best….But this new consensus is flawed.
  • Over the next twenty years, fully 60 percent of total entitlement spending increases will stem from population aging. It is not until 2045 that per-capita health care spending growth becomes the more important factor.
  • In present-value terms, over the next seventy-five years, Social Security, Medicare, and Medicaid will cost an additional 5.7 percent of GDP, and the cost increases will be split almost evenly between population aging and excess health care cost growth.
Sep 19, 2008 | Leave a Comment | by

Good News: “Nudge” is Working

One of the most successful public policy proposals in recent years was a joint project by the National Center for Policy Analysis and the Brookings Institution.  It was based on ideas that later published in a Thaler/Sunstein book called Nudge, which I reviewed here.  Basically, employers get a safe harbor against lawsuits if they automatically enroll their employees in 401(k) plans with diversified portfolios.  (The employee remains free to opt out, however.)

Nudge Bookcover

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Sep 10, 2008 | 2 comments | by

For Pete’s Sake

This is from a Wall Street Journal editorial on the discovery that almost one-third of Medicare's medical equipment payments were improper or fraudulent.

Mr. Stark and his ilk consistently claim that Medicare is a model for government-run "universal" health care because it spends less on overhead than the private sector. True, Medicare's administrative costs are just 3% of total spending, while the private sector hits 11% to 14%.

Congressman Pete Stark

Congressman Pete Stark

But insurance companies spend money to screen their claims for fraud. Medicare automatically pays more than 95% of the bills it receives. This lack of scrutiny reduces overhead, but it makes the program highly vulnerable to abuse. In June, a high-school dropout pleaded guilty to conning Medicare out of $105 million by submitting over 140,000 bogus claims before auditors noticed. It was the biggest health-care fraud in American history.

Sep 04, 2008 | 1 comment | by

Designing Health Insurance

This priceless gem is from a New York Times editorial:

There is no easy solution short of increasing federal spending or finding a way to drive down the cost of drugs.

They're talking about the Medicare Part D drug benefit which has a "doughnut hole"- in which seniors are exposed for 100% of drug costs between $2,400 and $3,850.

Amazingly, more than 200 million nonelderly Americans – without government spending or any government price controls – have managed to find health insurance with no doughnut hole.

Sep 03, 2008 | 2 comments | by
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