Lawyerkill wrote:
> On Sep 14, 2:51�pm, Michael Coburn > wrote:
>> On Mon, 14 Sep 2009 08:18:47 -0700, Sure,Not wrote:
>>>> AND ALL OF THIS IS A MARVELOUS ILLUSTRATION OF THE BENEFITS OF ALLOWING
>>>> THE PRIVATE INSURANCE INDUSTRY TO FAIL DUE TO ITS OWN LIMITATIONS.
>>>> GOVERNMENT DOES A BETTER JOB OF SOCIAL INSURANCE THAN THE PRIVATE
>>>> SECTOR AND WE HAVE JUST SEEN A LOT OF WHY THAT IS SO.
>>> Ok. �Let's try this. �Why does the gov't do a better job? �They can
>>> print money?
>> 1. Government carries a much bigger hammer than all the different
>> insurance companies when it comes to controlling prices. The decision for
>> government is not one of maximizing profits. �It is one of making certain
>> that there is adequate overall incentive in medical services to insure
>> competence and quantity. �At present we have the most bloated and
>> expensive health care system on this planet and _NO_ _WAY_ to control
>> costs. �When Medicare attempts to control costs, the providers shift the
>> prices to the insurance companies who must compete with one another and
>> who must pay whatever rate the providers might want. �For some unknown
>> reason this is supposed to be a black mark against Medicare. It is
>> actually a black mark against the "free market" health insurance
>> companies. �They CANNOT CONTAIN COSTS.
>>
>> 2. Government does not need to make a profit and does not actually need a
>> "pool of money" to protect itself from fluctuations in claims. If such
>> fluctuations arise then government can borrow less expensively than
>> private industry. �Do not confuse this with typical government debt. �It
>> can be an initial pool that is paid down over time in a totally off
>> budget system. �The SS and Medicare trust funds tell us that such
>> mechanisms don't work. �They are repeatedly used as pools of money to
>> hide deficits. �It would be better to operate the social insurance
>> systems in a BORROWED pool that is TRANSPARENT and the cost of which is
>> paid by dedicated taxes (i.e. FICA and Medicare taxes), and paid in
>> premiums. �The idea of government INVESTING from an accumulated pool is
>> stupid. It creates all kinds of political crap about how to AB-USE the
>> funds. �Health care costs what it costs and will cost in the future. �
>> Trying to "save up a bunch of money" is stupid. �No matter what you do
>> the healthy will be paying for those who are not healthy. �That is how
>> INSURANCE works no matter who runs it.
>>
>> 3. Government does not need to advertise and sell its policies and to pay
>> a board of directors, a CEO , a bunch of VP's and �executives, and then
>> pay bonuses to people who figure out how to screw the policy holders out
>> of their benefits. �The Social Security Administration and Medicare
>> Administrators maintain very good on line facilities and phone access
>> lines that provide for "customer" interface, and they do it quite well at
>> a low cost.
>>
>> 4. Medicare also processes claims from providers more efficiently than
>> does the private insurance sector.
>
>
> Then why is Medicare going broke?

Coburn's incorrect, but you figured that out for yourself. :-)

Here's the data:

1) Medicare has lower administrative costs when they are calculated as a
% of total health care costs managed. Medicare is at 3%, the private
insurers are at 12%.

2) That seems more efficient, but you're comparing apples and oranges.
Medicare is a seniors health care program, while private insurers cover
those not on Medicare. Put another way, Medicare covers people who need
a lot more heath care (or are sicker, with more deadly diseases) than do
private insurers, whose members are, on average, far healthier.

3) That means that the average claim size that Medicare handles is much
larger than that of the private insurers. It takes just as much admin
time to handle a $50,000 bill than it does a $50 bill.

4) Further, Medicare just processes whatever they are given mindlessly,
while the private insurers spend time contesting and investigating
claims to eliminate fraud and lower costs. That balloons admin costs but
results in lowered health care costs. You don't see that fact
illustrated in a pure admin/cost comparision.

4) If you look at administrative costs on a PER PERSON basis rather than
a percent-of-claims basis, Medicare's admin costs were 24.8% higher than
the private insurers.

Charts are he

http://timerealclearpolitics.files.w...dmincosts1.gif

(Coburn can be expected to shriek when he sees the 'Heritage' logo, but
a dislike for a particular organization is not a refutation.)

Medicare's an adminstrative nightmare from an efficiency standpoint.
Anyone who tells you that they are more efficient are either uninformed
or lying.

JG

>
>
> http://www.newsweek.com/id/199167
> "That the programs will ultimately go bankrupt is clear from the
> trustees' reports. On pages 201 and 202 of the Medicare report, you
> will find the conclusive arithmetic: over the next 75 years, Social
> Security and Medicare will cost an estimated $103.2 trillion, while
> dedicated taxes and premiums will total only $57.4 trillion. The gap
> is $45.8 trillion. (All figures are expressed in "present value," a
> fancy term for "today's dollars.")"
>
>
>