ED101595b: Medicare Miracles

COMMENTARY Health Care Reform

ED101595b: Medicare Miracles

Oct 12th, 1995 2 min read

Senior Fellow


Those who say the Age of Miracles ended centuries ago must have missed the opening stages of the Medicare reform debate. In recent weeks, some miraculous events have been witnessed by millions of Americans.

First, there has been a big change in public opinion on the issue. Until fairly recently, nobody would believe there is a problem with Medicare. Now, when you ask, 63 percent of the public say there is a problem.

Second, those of us in Congress seeking to reform Medicare are making miraculous progress in explaining what we are trying to do and why. Until recently, it was difficult for people to understand that we are not cutting Medicare spending. We're reducing the growth of Medicare spending. There is a big difference. Whenever you hear House Speaker Newt Gingrich saying Medicare is going bankrupt, he always notes that we are going to spend more money on Medicare, not less. Remarkably, this message is now even getting through to the national media.

I was struck several weeks ago when Tom Brokaw and NBC News came to my district -- which has more senior citizens in it than any other in the country -- to attend a town hall meeting with my constituents. A few days later, when Brokaw introduced the town hall segment on the national news, he said "Republicans want to reduce the growth in spending." Did you get that? Not "cut spending."

The following week, ABC News did something on the same topic, and Peter Jennings introduced a segment about how different lawmakers are handling the Medicare issue by saying "Republicans want to reduce the growth in spending on Medicare." Bingo.

Then, as if to top it all off, I was watching the news and saw a segment with President Clinton, who said during a talk with Speaker Gingrich that Republicans want to reduce the growth of spending on Medicare. Surely, when Brokaw, Jennings and Clinton all get it right, we have truly witnessed a miracle!

Of course, it shouldn't take a miracle. The numbers speak for themselves: Under the "heartless" Medicare reform plan we have proposed, yearly spending on the average Medicare recipient will increase from the current level of $4,800 to $6,400 in seven years. It really drove us crazy when our opponents called that a "cut." The reason they did was because the $6,400 is less than they wanted to spend.

If we do nothing to slow the growth of Medicare spending, we will have to impose a huge tax hike on working families or increase premiums dramatically for seniors. There is no escape. To stick with the program as currently structured, you would have to raise the Medicare payroll tax more than $1,700 over seven years for somebody making $40,000 a year . That is a 100 percent increase. Or you have to raise the Medicare premiums paid by seniors by an astounding 300 percent.

Instead, we should restructure the program by allowing elderly citizens greater choices in medical coverage, which will force health-care providers to compete for their services. Such a system would be similar to the Federal Employees Health Benefits Program (FEHBP) which covers 9 million federal workers, retirees and their families.

Under FEHBP, competition between insurance companies, health maintenance organizations (HMOs), retirement groups, professional organizations, and labor unions has consistently held premium costs below levels in the health-care market at large. Plus, unlike Medicare's "one-size-fits-all" approach, FEHBP enrollees can choose from a wide variety of health-care plans, including many that Medicare doesn't offer. That way, enrollees are able to tailor their coverage to their own medical and financial situations.

Of course, pushing our plan through won't be easy. Medicare is a paperwork monster backed by fierce special interests. But I believe we can ready Medicare for the 21st Century.

Maybe we'll need another miracle to get there. But who would have predicted six months ago that we would see the amazing things that already have happened in our effort to fix Medicare?


This essay by Rep. Dan Miller, R-Fla., is adapted from a recent speech to the Physicians' Council of The Heritage Foundation, Washington, D.C.

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