Monday, September 21, 2009

Random Thoughts on Medicare - Part II

Here's a radical idea that will never fly -

Instead of cutting Medicare provider payments, suppose they were increased enough to allow the providers to make a bit of money...or at least enough to cover the cost of treatment.

To pay for the increase, the Medicare premiums would be indexed to a person's income. Below a certain income, the premiums would vanish, while above some level, they would increase up to some cap.

Why would you want this? Simple. One of the cost drivers in the private insurance sector is a transfer of unreimbursed expenses from the public sector to the private one. If it costs $500million to keep a medical facility open, somebody has to pay the bills. If the government isn't paying it's share, there's no option other than to raise the rates charged to private sector patients. Those increases are reflected back into everybody's insurance premiums. Conversely, if Medicare starts to pay more, the insurance premiums won't go down, but their rate of increase should slow.

Too bad there are so many seniors that vote...
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