The attractions of President Clinton’s proposal to let early retirees buy into Medicare are so obvious that Chris Jennings, the able White House health policy expert, is probably right when he says, “The Republicans are making a political mistake in saying no to this without thinking it through.”
But there are flaws in the Clinton plan so serious I come away believing that it inadvertently exposes a weakness in the president’s whole approach to this issue.
The political appeal of the Clinton plan is clear. Until he came up with this idea, it looked as if the Democrats for the first time in almost two decades would go into an election campaign without their favorite weapon: Medicare. Every two years, at least since 1980, Democrats have flooded the mails and the airwaves just before Election Day with dire warnings that the Republicans are out to gut Medicare.
Last year, Clinton and the GOP Congress agreed on a plan to postpone the threatened bankruptcy of the Medicare system for 10 years and set up a bipartisan commission to deal with its longer-term problems. With the commission not scheduled to report until March of next year, it appeared the issue was off the table for the 1998 election.
Clinton has put it back into play by proposing to let millions of people between 62 and 65 without health insurance, as well as displaced workers as young as 55, buy into Medicare. Key congressional Republicans reflexively denounced the idea, perhaps diminishing its chances of becoming law but setting up a clear political issue for this fall.
The target population for the Clinton program clearly can use help. They are of an age where health problems are more frequent and private insurance is harder to get.
The problem is that Clinton has no new money to put behind his plan, so it must be self-financed. Administration actuaries say the monthly premium for those between 62 and 65 will be $300 a month, plus a surcharge on their monthly doctors’ insurance once they pass 65 and start receiving Medicare. For displaced workers 55 to 61 it would be about $400 a month.
Because of that cost, officials estimate only 300,000 in the targeted population - one out of 10, presumably the most affluent - would actually be able to take advantage of the program. Clinton is proposing no government subsidies for the rest.
When asked about the fairness of such an approach, Health and Human Services Secretary Donna Shalala told reporters at the White House, “This strategy is about access to health insurance. It is not addressing the financial problems of every individual.”
As Chris Jennings readily acknowledged, that argument is precisely the opposite of the Clinton position during the battle over his comprehensive health care proposal in 1993-94. Back then, when the Clintons were urging employer mandates and federal spending to provide health insurance for everyone, it was Republicans who advocated an alternative which would simply say every family should have “access” to insurance. The president, the first lady and Shalala all dismissed that as a meaningless gesture for those who couldn’t afford the premiums.
“You’re right,” Jennings said with characteristic candor. “That was our criticism. But these are different days.”
Indeed, they are. But Clinton’s proposal raises much more than a question of consistency. Until now, Medicare has been for everyone over 65. Once you change the description so it becomes a program also for some people up to a decade younger, the illogic of the program is nakedly exposed.
Why should the millionaire of 65 receive heavily subsidized Medicare benefits while the ailing former waitress of 62 gets no help in obtaining health insurance? It makes no sense at all. But the same president who now wants to open Medicare to affluent early retirees objected last year when the Senate voted to charge well-off Medicare recipients over 65 higher premiums for their Part B doctors’ insurance. He said that change should be considered, along with alternatives, by the Medicare commission.
But now he has jumped the gun on the commission with his own headline-grabbing proposal - one that will help the well-off much more than their less affluent peers.
A year ago, Oregon’s Democratic Gov. John Kitzhaber, a physician, had the courage to tell the American Association of Retired Persons that Medicare should be for those who need it, not an automatic subsidy for people of any income level who have reached the magic age. Kitzhaber asked for a seat on the Medicare commission, so he could raise that issue, but predictably didn’t make it through the White House screening.
Sadly, Clinton prefers to take the easy road.