Ama’s Ideas Help Medicare Reform

If the partisans on Capitol Hill do tire of throwing mudballs, Medicare demands their attention. It goes bankrupt four years from now; reform is mandatory.

Congress should explore changes like those the American Medical Association recently recommended.

The AMA proposes that seniors be given a choice, between:

1) A traditional Medicare plan, amended to make it viable. Under Medicare, government chooses the benefits and imposes whatever taxes are required to pay them. But continuing current benefits would require a staggering tax increase of $14,000 per household through the year 2005.

2) A consumer-guided health insurance plan, like the one for federal employees. The government makes a defined cash contribution and the consumer chooses an insurance policy from an array of competing private companies and benefit packages. Consumers who prefer a low-cost policy could put part of the federal contribution into a medical savings account. While Medicare’s costs have gone up 10.5 percent a year, premiums under the federal workers plan (covering an older clientele, 40 percent retirees) dropped 3 percent in 1995.

There may be other good proposals besides AMA’s. All that’s needed is a Congress and president with the guts to do their duty.

, DataTimes The following fields overflowed: CREDIT = John Webster For the editorial board