Happy Birthday, Medicare — the best form of health insurance

By Jackie Wolf
Daily Hampshire Gazette, July 31, 2014

AMHERST, Mass. — There is a joke that goes: What’s so good about turning 65? Answer: Insurance agents stop calling. I would like to suggest a variation on that joke: What’s so good about turning 65? For almost all people in the United States, the good news is they are eligible for Medicare.

The good news is they no longer, each year, have to read through charts and tables of private insurance company policies with different benefit levels, different deductibles, different co-pays and different premiums to find an affordable policy. When you are eligible for Medicare, you really have a great deal more peace of mind and health care security.

For almost 50 years, Medicare has provided millions of Americans with health insurance — in fact, approximately 37 million people in 2012 in all 50 states. It is a tested, proven United States model of good, government-run health insurance. Medicare operates efficiently and effectively paying 97 cents of every dollar on direct health care services. Medicare provides doctors and researchers with volumes of data on medical procedures and outcomes searching for the best approaches to treat and cure disease and illness. Medicare also covers an annual physical for all enrollees as well as fitness programs.

Compare those facts to the reality of the private insurance market. I challenge you to find any private insurance company that spends 97 cents of every dollar collected on direct health care services. With their high executive salaries, high budgets for marketing and advertising, and hundreds of denial-of-claims clerks, private insurers struggle to meet the mandated level of paying out 90 cents for every dollar collected on health care services.

Marilyn Tavernner, administrator for the Centers for Medicare and Medicaid Services is paid an annual salary of $143, 800. Compare that to the salary of Andrew Dreyfus, CEO of the Blue Cross Blue Shield of Massachusetts, who earned $1.1 million in 2011 (and that does not include benefits to which he is entitled). Remember: Blue Cross Blue Shield is a non-profit. In addition, the 17 directors of Blue Cross Blue Shield of Massachusetts are paid $47,000 to $54,500 each to show up for 10 meetings a year.

Private health insurers spend so much on marketing and advertising because they are looking for healthy people. They want to attract younger, active people and sell them policies – that’s called “cherry picking” — while avoiding, and, if possible, getting rid of older, sick people — that’s called “lemon dropping.” Many Massachusetts residents are speaking out for single payer for Massachusetts — or Improved Medicare for All Massachusetts.

They are tired of the fact that their health insurance is tied to their employment. They are tired of the fact that their employers have a say in what benefits are available. They are tired of filling out pages of paperwork to file claims for benefits they have paid for. And they are tired of all the bills for premiums, co-pays and co-insurance.

Physicians are, likewise, getting fed up dealing with the private health insurance market. Just this past week, I was talking with a graduate student whose mother is a psychiatrist. He told me his mother spends approximately 20 percent of her time filling out paperwork to get payment from the multitude of insurance companies. And that doesn’t cover the time she spends on the phone challenging the denials of treatments for her patients. It’s frustrating, discouraging and wrong.

We don’t need private insurance companies as middlemen. A state single payer health care plan — an improved Medicare for All Massachusetts plan (Senate bill S515) would insure all residents and guarantee quality, affordable care to all. Let’s look to the model of Medicare and enjoy health care security from cradle to grave. Happy Birthday Medicare!

Jackie Wolf is chair of the League of Women Voters of Amherst Health Care Committee.