August 18, 1997
Phasing Out Medicare
By Joseph Kellard
Because Medicare was egregiously enacted as a “guarantee,” most
politicians evade that instead of their continuous “reforms” to save
that morally and already financially bankrupt system from extinction,
reforms must be enacted to send it gradually into extinction..
The Medicare system sacrifices the young to the old, and is thereby
fundamentally immoral and therefore unworkable. Thus, in regard to
its failure, Americans sound their inevitable mantra: “Something
must be done.” But every “something” politicians enact, such as
government mandated HMOs and the Kennedy-Kassaubaum bill,
ultimately intensify the problems caused by their original programs
and reforms.
HMOs essentially seek to forcibly cut the expensive bills of
high-risk patients by limiting care and by financing their expenses
with the surplus money from healthier patients; therefore, HMO’s
sacrifice the healthy to the sick. Insurers are thereby pressured to drop
costly and risky patients. The more treatment is refused, the more the
“gatekeeper”, i.e., the bureaucrat, gets paid.
The Kennedy-Kassebaum bill, passed last year, forces insurers to
cover those costly patients. Since premiums would thus rise and
pre-paid plans would limit more care, the managed care
administrators would have to intensify pressure to withhold care.
Medical Savings Accounts (MSAs) are the only rational, potent
solution to the essentially corrupt HMOs and similar “reforms” now in
vogue, since they encourage and beget what individuals must
exercise in a free nation and reality: the personal responsibility to
provide for one’s own medical expenses.
A Medical Savings Account is a tax-free account. The amount
your employer pays in health insurance is placed in a savings
account, and thereafter you would use that money to purchase your
own health insurance and medical care, whether it is a $250
deductible policy, an HMO, a catastrophic insurance policy, or
anything you want. MSAs transfer your money from your employer
back to you. Last fall Congress inaugurated these “experimental”
accounts; however, they are limited to fewer than one million
self-employed Americans.
MSAs will put an enormous downward pressure on prices and
greatly reduce the costs of health care by instituting a free market and
consumerism. They will provide individuals the freedom and thus
encourage the personable responsibility to exercise judgment and
economy in regard to what medical plan they want and what doctor
they will visit. .
MSAs will allow all individuals to deduct 100% of their medical
expenses, including health insurance premiums, from their taxes, and
allow healthier individuals to leave pre-paid programs. Those plans
could no longer use surplus money from healthier individuals to
cover those who need extended care. Premiums would rise and thus
drive more individuals out of pre-paid plans. This entails phasing out
Medicare.
But what about the people who paid into Medicare but are now too
old to work and save on their own? Medicare can nevertheless be
phased out over an allotted time span without effecting them.
People who are now 65 and older will receive their Medicare
benefits. However, those who are younger will gradually get X
percent less from Medicare and be obligated to save on their own to
cover that loss, until those 35 or younger will be ineligible for any
Medicare benefits. Both age groups will use tax-deductible income
placed in MSAs, which earn interest, for their future medical
expenses. What they save on insurance deductibles and medical bills
through their MSAs today can be used for their retirement expenses,
whether on medical or anything they desire. As younger individuals
accumulate funds in their MSAs for retirement, the eligibility age for
Medicare can progressively be raised over the allotted time span until
that system is phased into extinction.
Many politicians, including President Clinton, oppose MSAs
because they will drain the collective medical insurance pool that
sacrifices the healthy or young to the sick or old. This is precisely
what MSAs will do. They undercut the whole pre-paid system that
continues to strengthen the government’s paternalistic, coercive
powers that shackle individual freedoms.
Our statist politicians and their supporters have to accept that
freedom and adulthood demand individuals to take responsibility for
their lives and make their own judgments and choices.
Joseph Kellard is a freelance writer. He also publishes a quarterly
newsletter: Axiom 3. To hire him or for information on his
newsletter, he can be reached by e-mail at jkaxiom3@aol.com
--- or by mail: PO Box 334, Rockville Centre, NY 11571-0334
For information on Medical Savings Accounts write to:
Americans for Free Choice in Medicine
1525 Superior Avenue Suite 100
Newport Beach, CA 92663
Telephone: (714) 645-2622
Electronic Mail: afcm@netcom.com
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