Premium Support, Medicare, and Obamacare

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A number of Republican health care policy proposals that seemed out of favor in the Obama era are now being given new life. One of these involves Medicare, the government health insurance program primarily for older Americans, and is known as premium support.

Premium support enjoys support from both sides of the aisle, depending on the context.

That's topic of this week's Healthcare Triage.

This episode was adapted from a column Austin and Aaron wrote for the Upshot. Links to sources and further reading can be found there:

John Green — Executive Producer
Stan Muller — Director, Producer
Aaron Carroll — Writer
Mark Olsen – Graphics
Meredith Danko – Social Media

Premium Support, Medicare, and Obamacare

36 thoughts on “Premium Support, Medicare, and Obamacare

  1. Why is there never any discussion about price control? It’s always about spending control but never talking about why healthcare costs as much as it does. The Times did an article called “The bitter Pill” And it showed how healthcare cost are arbitrarily inflated by healthcare providers. Examples include $12 per pill of Advil even though, for the same price, you can buy a 100 pill bottle of identical medication. After I was hospitalized and went under surgery. I looked at my bill and its ridicules that I’m charged $200 per bag of saline through out my entire stay.

    • Diana, there is actual competition in the food markets. If one guy sells his potatoes above market price, people won’t buy his potatoes. Competition is the point in the free market. There is NO competition in healthcare, and THAT is what drives the gouging. Necessity =/= inelastic.

    • Diana Peña So socialism fails due to human nature and greed but somehow all human nature disappears once a free market takes place? You’re​ just as stupid as any extreme communist or socialist but your just on the opposite side of the spectrum. I’ll be waiting on for you to explain how a market free of regulation doesn’t turn into monopolies and what should be illegal practices all I the name of money. Since you love the free market as though it is perfect would you be happy to have your small children in dangerous factory jobs getting paid in company store coupons or if their lucky less than a $1 an hour? Those examples have happened in the USA during your beloved free market.

    • +Austin Anderson Healthcare is more expensive not because it’s inelastic nor either because it requires skilled labor. Food is a counterpoint for the elasticity argument, which you acknowledge. The tech sector is a counterpoint for the skills argument.

      The only problem in healthcare is that we have, *for decades*, impeded market forces. Beginning with the wage controls that propelled employer-provided health insurance fringe benefits into the mainstream, the protectionism established for and by the AMA, and the costly barrier to innovation that is the FDA, we have not had a competitive marketplace in medicine for generations now.

      The solution is not to compound the problem with yet more government intervention that will only serve to line the pockets of politicians, regulators and entrenched health industry interests.

      It may well be that if we merely eliminated the deductibility of health insurance, prices in the U.S. would rapidly begin to fall. Consider, for example, what’s happened to the cost and advancement of laser eye correction surgery: it is a fraction of what it was originally. It is rarely covered by insurance. Just the other day I saw two offers for the surgery for under $1500.

    • +Adam Jeffords I took a look at your study, but it doesn’t support your conclusion. The claim is that, as the U.S. is the largest healthcare market in the world, all pharmaceutical companies, *foreign and domestic*, develop drugs with the U.S. market in mind, for profitability. It’s immaterial to the point what the cost structure of U.S. pharma companies is. The salient point is that companies are going to seek profitability, and the U.S. has the most profitable market in the world.

      Also, the research you cite looks only at pharmas and not biotech companies, which are often startups where all funding is going to R&D. Anyone can pull papers from random journals, but it’s much easier to follow the money. Pharmaceuticals have no problem doing it, and U.S. citizens pay the bulk of the bill for the world’s research.

  2. This channel is wonderful. I feel as though it is an honest attempt to explain the situation with appropriate upsides and downsides, and it also doesn’t resort to making either side the enemy.

    • Eliminating the caps on HSA is a good idea. I also like the loosing of what is defined as medical expenditures. Over all as a replacement for the ACA I think it is lacking.

    • I want Medicare for all. A Universal health care law. The ACA is a mixed bag. It has helped people I know and has hurt people I know. It somewhat helped me by manding preventive care to be free. Got all my shots and such.

    • I can’t support that plan because I think it diverts money towards an artificial bureaucracy that has no feedback mechanisms because it relies on tax money for all labor and materials, because of this there can be no open market allocating the services promptly and fairly according to the value judgments of all participants. Instead, the services must be rationed and allocated by law or decree and the compensation of physicians and practitioners be “administered” by authority. Every aspect of the system is wide open to arbitrariness, abuse, maltreatment, and even corruption. In time, a system designed this way and forced into existence through coercion is bound to succumb to all these vices.

    • Medicare for all does not make an artificial bureaucracy. It also does not do much to the market. Private providers will compete for customers. All people are covered so all people are potential customers. Medicare has a overhead of 6%. Private health insurance has an overhead of 20%. It used to be worse. The ACA mandated that money accumulated by private insurance must be spent for healthcare at an 80% rate.

  3. The elderly who were sold medicare/medicaid by politicians deserve to get what they designed their lives around, but going forward I don’t think there should be any subsidies or support from an entity that can steal money and redistribute it, force people contract with people they don’t want to contract with, and place barriers to entry for potential competitors in a marketplace. I’m sick of the political means. It’s like a cancer on society. Help people or get out of the way. Quit trying to legislate morality. The road to hell was paved with good intentions. We are living in that hell right now.

    • The whole medical industry is trying to pay for its expenses while continuing to invest in servicing the consumer best. This is what profit enables and your conception of hoarding money proves your ignorance of economics because you assume that wealth is not something created but discovered and kept from everybody else like it was a zero sum game. This is just false.

    • Wealth is indeed created. Yet somehow, in spite of wealth in the USA being created at the fastest it has been in decades, somehow wages (adjusting for inflation) have been stagnant since the 1970s, while the share of the wealth owned by a tiny minority has been gradually increasing over the same amount of time. So it seems to me, just from looking at the data, that while the wealth is indeed created by some very hard workers, it’s their bosses who own it.

      Actually, economics in a capitalist society is a zero sum game: you cannot have some people be incredibly rich without making it so that a much larger part of the population are just a single missed pay cheque from homelessness. There is a finite amount of wealth at any given time, so the only way to own such a massive portion of it (a share which is increasing over time) is by depriving others of its use.

      The main source of a rich person’s wealth is not from creating wealth themselves; it is through owning the means by which that wealth is created and paying other people a tiny fraction of what they create to do it for them. If they own the means by which wealth is created, then they own the wealth that comes out of it, short the gradually shrinking cut that goes to the workers, of course.

      As for the medical industry, it exists for the same purpose every industry in a capitalist society does: to create wealth for shareholders. It does that by helping those customers who can afford help – which means that without government interference, it will allow anybody who cannot afford help to suffer and die. This is why there are laws requiring that emergency treatment be given regardless of ability to pay, but even this leads to massive amounts of medical debt, because the law doesn’t require that the treatment be free.

      Yet somehow, every country in the EU is able to provide quality healthcare to all of its citizens regardless of their ability to pay. Even fucking Greece, in spite of its current economic situation, is managing it. Likewise Canada, Australia, New Zealand, Norway, Mexico and so many other countries, some of them far less wealthy than the USA, are able to pull it off. How is it that the USA, quite possibly the wealthiest nation on the planet, is unable to do the same?

    • What an old and tired argument you are putting forth. The extraction of surplus value from the proletariat by the bourgeoisie is an argument that is completely destroyed by the real description of how production processes develop. No capital can be purchased without saving first and it is the capitalist a.k.a. the saver who provides this by forgoing present consumption for future consumption. It is the demonstration of time preferences by a capitalist and an employee, and the risk involved in investment that differentiates what investors and workers get paid. A worker exchanges his labor for savings now, while the capitalist risks buying capital and paying wages now for an interest payment in the future. The reason the capitalist earns interest is because many businesses form, but many businesses are not profitable and fail, all the while workers have been paid.

      Centrally planned government healthcare that is coerced into existence through legislation suck. The care is of low quality because of prices don’t reflect true consumer demands. When you set prices you get shortages and this is why wait times are so outrageous in government designed health care administration.

      Keep guaranteeing free stuff to people who don’t pay and sooner or later you run out of “free” stuff.

  4. Can you explain bernie’s medicare for all plan? Like explain how it can be cheaper like he says, yet still cover everyone? Also how it would affect americans financially.

  5. Part of the plan of using the market to reduce costs with health care is insurance companies have set up cartels and thus can set whatever price they want.

  6. Would make an episode on robotic surgery for all marketed procedures? Are the outcomes worth the costs to both the individual and the economy?

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