Health Care Reform and Older Adults

Article excerpt

In their 2006 book Aging Nation, Schulz and Binstock referred to "merchants of doom"--academics, political figures, and journalists who mistakenly believe that we cannot afford the aging of the population. A central concern of these doomsayers is the cost of entitlements, primarily social security and Medicare. Robert J. Samuelson (2005), the Washington Post columnist, argued that we face "entitlement paralysis" (that is, an inability to address "huge federal retirement benefits" that "may seriously damage the economy and American politics"). As "partial solutions," he suggested "slowly raising eligibility ages and cutting benefits for wealthier recipients."

Talk of a general entitlement crisis is misleading, however, because social security and Medicare face very different problems. Between now and 2050, spending for social security will increase from 5 percent of gross domestic product (GDP) to 6 percent, and the social security trust funds will remain solvent until 2043 (Congressional Budget Office, 2009; Orszag, 2009b). In contrast, Medicare's Hospital Insurance Trust Fund will run out in 2017 and grow from 1.71 percent of GDP to 3.85 percent in 2050, while Medicare as a whole will grow from 3.59 percent of GDP to 8.74 percent (Boards of Trustees, Federal Hospital Insurance and Federal Supplementary Medical Insurance Trust Funds. (2009).The entitlement problem is really a Medicare (and Medicaid) problem.

However, and this point is critical, costs are not solely an issue for Medicare.

In fact, between 1970 and 2006, Medicare had a slightly better record of controlling cost per enrollee than did private insurers (Mahar, n.d.).The underlying problem is health care inflation. According to Peter R. Orszag (2009b), director of the White House Office of Management and Budget, "health costs are the real deficit threat." In 2008, the Congressional Budget Office estimated that even without Medicare and Medicaid, in the absence of change, by 2082, health care would consume around "70 percent of the nation's wealth" (as cited in Kennelly, 2009).

Although the aging of the population contributes to the growth of health care spending, it is by no means the critical factor (Orszag, 2008).The central reason why we spend so much is the high cost of our "health care goods and services" (Anderson, Reinhardt, Hussey, & Petrosyan, 2003). We spend "so much more than.., any other country" because "we pay so much more for each unit of care" (Klein, 2009).To address Medicare and provide affordable health care for everyone, we must succeed in "bending the curve" (that is, flattening out the growth of health care costs generally) (Orszag, 200%).

The link between health care costs and the Medicare "crisis" made it imperative for advocates of health care reform (defined here as reform with a strong public option) and defenders of social insurance to work together. First, older adults, who rely most heavily on social insurance programs, were the only age group whose vote President Obama lost in 2008, and they are the age group most likely to oppose health care reform (Connolly, 2009; Exit Polls: Obama Wins Big, 2008; Gelman, Silver, & Lee, 2009). Second, many leading opponents of health care reform also advocate entitlement reform, which could lead to cutbacks in social security and Medicare. Third, if health care reformers and defenders of social insurance coalesce, they could strengthen both movements.

As it turned out, these movements have worked together. Health Care for America Now (HCAN), a broad coalition of more than a thousand organizations (including NASW) and perhaps the leading advocate for health care reform with a public option, identified closing the Medicare Part D "doughnut" hole as a key component of reform (If the Insurance Companies Win, You Lose, n.d.). The Alliance for Retired Americans (ARA) and the Older Women's League belong to the HCAN coalition. The National Committee to Preserve Social Security and Medicare, the ARA, and AARP all endorsed House bill for the Affordable Health Care for America Act (HP, 3962) (see http://thomas. …