Sunday, August 28, 2011

Medicare Spending Growing at Far Less Than Private Insurance Costs –

Another Conservative Position Obliterated by Facts

One of the major talking points in the Paul Ryan Plan to save Medicare by destroying Medicare and making it a private insurance program is that competition in the private insurance arena would mean lower cost increases than with Medicare.

The Dismal Political Economist has long asked the unanswered question of “if private insurance could keep medical costs from rising so fast, why hasn’t it already done so.”  Now new data is out that shows that Medicare costs are rising much slower than private insurance costs.  Peter Orszag, a former Obama Budget Director writes that

Medicare’s growth slowdown has been much greater than that of private health insurance, however, as Maggie Mahar has noted on the Century Foundation’s Health Beat blog. In the 12-month period that ended in June 2011, Standard & Poor’s index for commercial health insurance rose 7.5 percent, while its Medicare index rose only 2.5 percent. The S&P data show that Medicare spending growth has been falling fairly steadily over the past 18 months.

Images of the World As Conservatives
See It - The Big Things are Government
Destroying Society

He goes on to explain why this might be happening but of course it does not take an economist to understand that if Medicare is well run its growth in  health care costs should be lower than private insurance. 

None of this will sway a single Republican supporter of Mr. Ryan’s plan to turn Medicare over to private insurance, letting retired individuals take on more and more of the costs of heath care.  Facts, logic, data and analysis are just not part of their thought process.  Faith based ideology, that’s what counts.

No comments:

Post a Comment