Privatizing Medicare Will Threaten Benefits For Today’s Senior Citizens

Marin Cogan has a report from Pennsylvania detailing the struggles one freshman Republican is having explaining his vote for draconian budget cuts to anxious constituents. It’s mostly self-explanatory, but I thought one element of Representative Lou Barletta’s dialogue needs further policy analysis. In response to a senior citizen who’s angry about Medicare cuts, Bartletta doesn’t try to justify cutting spending on elderly people. Instead, he tries to reassure elderly people that the massive cuts on spending for the elderly that he voted for won’t lead to reduced spending on the elderly:

Barletta replied “Yes, and it is going to be there. It’s not being touched for any of the senior citizens now, but for my daughter — ”

The man cut him off again. “It should be there for her as well.”

I’m going to take Barletta at his word and assume he genuinely believes that not only should shared sacrifice not require high income people to sacrifice anything, but also that nobody who’s 56 or 57 or 58 or 59 or 60 or 61 or 62 or 63 or 64 or 65 or currently receiving old-age benefits should suffer. The problem is that as Republicans tried to use lightning speed to minimize the backlash against their bill, Barletta seems not to have familiarized himself with the issues. One big problem is that while Barletta doesn’t think retired or near-retired people should have their benefits cut, he does believe in immediate cuts in programs for the poor. What’s more, Barletta seems to have believed Paul Ryan that Medicaid is just a program for poor people, ignoring the fact that most spending goes to middle class elderly and disabled people. So seniors will be hurt — and hard — by that aspect of the budget.


The other point is that privatizing Medicare will destroy it for everyone. Right now, one way that Medicare can afford such generous benefits is that it’s relatively stingy to doctors and other health care providers. For that reason, some doctors refuse to take Medicare patients. But Medicare represents such a large pool of patients that relatively few health care providers do this. Under the plan Barletta voted for, however, the pool of Medicare beneficiaries will shrink each and every year. That means the pool of doctors who are willing to treat Medicare patients will also shrink. That’s going to be bad for middle class Medicare beneficiaries. Meanwhile, higher-income elderly people will be opting out of Medicare to get a wider choice of doctors and non-elderly people of all stripes will have no interest in preserving a program that Barletta has promised we’ll never benefit from. The upshot is that some time in the 2020s or 2030s Medicare will go away for everyone.

It’s clear from Representative Barletta’s op-ed on the subject that it’s very important to him to reassure elderly people that their benefits won’t be cut. But he’s mistaken. The absolute best case scenario under the Barletta Medicare privatization plan is that elderly people will be able to choose from an ever-dwindling pool of doctors willing to treat them.