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Public Plan Founder Jacob Hacker Responds To Ross’ Open Up Medicare Compromise

By Igor Volsky  

"Public Plan Founder Jacob Hacker Responds To Ross’ Open Up Medicare Compromise"

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Early last week, Rep. Mike Ross (D-AR) — who led a group of seven centrist Blue Dogs who objected to a public option that reimbursed providers based on Medicare rates — floated a proposal to replace the public option with a proposal that would allow Americans under 65 to buy into the Medicare program. Medicare would reimburse the newly enrolled population “at a reimbursement rate much greater than current Medicare rates.”

On Friday, the Wonk Room sat down with public option godfather Jack Hacker and asked him to respond to Ross’ proposal. “Mike Ross is saying that the better alternative to having a new public health insurance plan that’s distinct from Medicare and competes on a level playing field, is actually to just open up Medicare on some new basis to people younger than 65. It’s a pretty remarkable development”:

What I would say is, I’ll take that and raise you. Okay, great! Let’s open up Medicare. If you think that’s a good idea, why don’t we open up Medicare more generally, in the sense that we use the basic Medicare model. And the Medicare model is build on the idea that people who are covered by Medicare have the ability to go to all the providers who contract with Medicare and be assured that in a transparent process that those providers will agree to be paid the rates that Medicare pays….What Ross is really saying, to my mind, is that Medicare is a good model. And the essential part of the Medicare model is that it contracts directly with providers, who agree to accept rates that are based on very careful thinking about what’s the proper amount to pay for different kinds of services.

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During the interview, Hacker rejected Ross’ contention that hospitals would close if they were reimbursed at Medicare rates, pointing to research which found that Medicare reimbursement rates lead to greater efficiencies.

Hacker also predicted that seniors would oppose opening the program to younger Americans and explained that Medicare was not designed “to provide health security to a younger than 65 population.” “There are a lot of holes in the Medicare program that should be fixed but which aren’t going to be fixed immediately. One of the important reasons to have a separate insurance plan is to make sure you’re providing the kind of good coverage that you know younger Americans need,” Hacker said.

“Ultimately though, we should understand the public health insurance plan idea, and Medicare as being very much interrelated. That over time, we should see this public health insurance plan and Medicare as a way of improving the cost effectiveness and the quality of care delivered to both younger Americans and to those over 65.”

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