And the Rationers say: ‘One of us! One of us!’ When it comes to Medicare, do you want “insurance company executives” or “health-care professionals” in the government telling you which medical treatment “won’t be paid for,” even if it is recommended by your doctor? That’s unattractive choice offered up by Paul Krugman (who seems to believe voters will go to the barricades to pick the government “professionals”). David Brooks agrees with Krugman that this is the choice, though he not uncharacteristically seems to want a bit of both.
But is that choice–government death panels or private death panels, in the language of the day–really what we’re stuck with? Many people, including me, have suggested “means-testing’–giving richer Americans smaller benefits–as an alternative that would avoid these unappetizing options. The idea is that nobody would be denied care–at least not any more than they are now under Medicare. But if they were relatively rich and could afford to pay for the care themselves they’d have the government’s subsidy lowered accordingly.
Comes now Ross Douthat to argue that “means-testing” too, “counts as rationing.”
But any means-testing program that actually saved money would need to affect the middle class as well as the hyper-affluent … In other words, we’d be asking some non-affluent seniors to, well, pay for more of their own health care, or else forgo treatments they would otherwise obtain.
I don’t quite understand Douthat’s point. If he is charging that means-testing would make some people–say the top third of the economic scale–“pay for more of their own health care”–well, duh. That’s how it saves the government money. But Douthat clearly wants to make a stronger claim, which is that many people would actually forego desirable care because they couldn’t pay their share. I don’t see why.
Why couldn’t the system work, in effect, like admissions to elite colleges: First they decide whom they want to admit, then they tailor financial aid packages that milk as much money out of students’ families as possible without anyone being charged so much that they don’t attend? Everyone gets what they need. Everyone pays as much as they can. I’m sure the college aid system doesn’t completely achieve that ideal, but you don’t hear many stories of kids who turn down Harvard because they can’t afford it. Means-testing wouldn’t perfectly achieve that ideal with health care either, but there’s every reason to expect you wouldn’t hear many stories of people who opted not to get treatment.
Plus the “means-test” hit on the rich would, unlike college tuition, probably be extracted well before the point at which a service would actually be provided. You wouldn’t have to charge affluent people with heart trouble more for their heart surgeries. You’d charge them more for their Medicare premiums. When it turned out they needed heart surgery they’d have the same coverage everyone else has. Why would they not get the surgery?
That would be a very different system, in terms of what treatment patients actually receive, than a Krugmanesque regime in which an expert board says nobody can get covered at all for certain treatments that Medicare as now operated would cover–or a Ryan style system in which insurance companies say the same thing. Both those systems would deny some doctor-ordered care to vast swaths of the population who couldn’t afford to pay for it entirely out of pocket. (They’d also create cumbersome, annoying bureaucratic reviews to make the necessary second-guessing judgments).
Under means-testing, Medicare would become, not a program that guaranteed subsidized care, but a program that guaranteed enough of a subsidy so that everyone could always afford care.
P.S.: It’s not at all clear that means-testing for Medicare would have to be as vicious, in terms of extracting the maximum that people could bear to pay, as college financial aid offices. The means-testing proposal cited by Douthat, from Charles Blahous, would only seek to shave the inflation-adjustment of benefits for the top 20 percent.** I assume that actually balancing the budget (and paying for Obamacare) will take something way more robust than that–on the order of cutting into the benefits themselves. That’s not an attractive political choice in itself. But if the alternatives are government rationing or insurance industry rationing, it starts to look pretty good. Even Steny Hoyer, the #2 House Democrat, has hinted that means-testing is the line of least political resistance. If you start locking liberal deficit-cutters and conservative deficit-cutters in rooms, don’t be surprised if that is what they come out with.
**–The benefits, under that mild proposal, would still adjust to keep pace with the Consumer Price Index– just not to keep pace with the typically higher rate of health care inflation.