Grow Medicare to save lives, money

By Arthur J. Sutherland III, M.D.
The Commercial Appeal (Memphis, Tenn.), July 30, 2015

Medicare, one of our nation’s most valuable and popular social programs, turns 50 on July 30, and we have the chance to make it even better. 

Medicare is a federal health insurance program enacted and signed into law in 1965 by President Lyndon B. Johnson.  The program currently covers 55 million Americans-people age 65 and older, and younger people with permanent disabilities. That’s about 17 percent of the population.

Medicare was originally conceived as a first step toward covering everyone in U.S. society under a national health insurance program. The program has sharply reduced poverty among seniors and significantly improved the financial security of their families. It has reduced health disparities related to race, ethnicity, and socioeconomic status.

Traditional Medicare only spends about 2 percent on administration/overhead. It’s very frugal versus private insurance, whose overhead and profits amount to closer to 12-14 percent or more.

Medicare has a slower rate of health cost growth than private insurance, and it pays providers quickly and with fewer hassles than private insurers. Patients in traditional Medicare can go to the health provider or hospital of their choice.

There are misguided political pressures to privatize Medicare because of skyrocketing health costs, but Medicare is one of the victims of our dysfunctional system of insurance dominated by the private insurers, and our supply driven medical markets.

The United States has never had a well-thought-out and debated national health care program with national standards, regional planning, and local implementation.

Cutting Medicare would be a mistake because it would increase poverty, worsen health outcomes and increase costs.

We already see what is happening in the Medicare Advantage plans, which are operated by private insurers. They cost the Medicare program about 14 percent more than traditional Medicare. 

Research done by Physicians for a National Health program,, shows that in 2014, Medicare Advantage plans were overpaid $34.1 billion, or $2,526 per enrollee. This documents that having private MA plans competing with traditional Medicare does not save money, but costs taxpayers billions of dollars more each year.

The solution to our health care crisis and the economic suffering it contributes to everyone in this country is to establish a publicly financed, mainly privately delivered national improved and expanded Medicare for All – a single-payer system. 

Private insurance companies have clearly failed us. To increase their bottom line, they strive to enroll the healthy, screen out the sick, and deny care. They afflict our health system with a mountain of unnecessary paperwork – about 31 cents of each health care goes to administration, most of it waste. 

Meanwhile they pay their CEOs multimillion-dollar salaries and squander money on advertising, etc.

The Affordable Care Act unfortunately builds of the faulty foundation of private insurance companies, and adds more cost and complexity to   health care access and delivery. Transitioning the ACA into the Medicare single-payer national health program would solve this problem. At the same time, rolling Medicaid into Medicare would complete the consolidation of our national programs.

A pipe dream? No. There is legislation in Congress, the Expanded and Improved Medicare for All Act, H.R. 676 that would put such a single-payer system in place. 

Other nations have enacted systems like this with great success. Our neighbor to the north, Canada, implemented their single-payer Medicare Program in 1971. They spend half of what we do, and live longer. Their people will not allow their Medicare to be privatized.

Passing an improved Medicare for All will save lives and money, and put our nation on the path of becoming one of the best health systems in the world. 

We have the talent, we have the resources: let’s put them to work! That would show real “American Exceptionalism.”

Dr. Arthur J. Sutherland, III, a retired cardiologist, is the Physicians for a National Health Program Tennessee chairman and national board adviser.