The U.S. government is the single largest provider of medical insurance. Since 1965, when Medicaid and Medicare became law, the two programs have grown to include 86 million Americans. By carving out coverage of both the extremely poor (many with health problems) and senior citizens (the age group with the most demand for healthcare), government created a massive tax burden for all Americans.
This tax burden has been sustainable because 1965 was the year when Baby Boomers, America's largest generation, began entering the workforce. They have since become the largest group paying the taxes on government insurance. But as 70 million baby boomers retire over the next 16 years, the number of Medicare participants will increase dramatically, and the ratio of workers paying Medicare taxes to retirees will decrease to 3 to 1 by 2025. The remaining workers will not be able to pay enough taxes to sustain Medicare.
Up to now, Medicare has acted like a giant stimulus to the healthcare industry. Medicare provided Americans over 65 with a government-backed blank check for all their health care needs. The cost of health care, formerly stable, began increasing more than 5 percent a year for 40-plus years. Quality of care increased due to huge technological and pharmaceutical advances that increased the life expectancy of seniors by more than 10 years.
Up to now, Medicare has been the greatest thing to happen to the health care industry, and the industry responded by making American health care the greatest in the world.
President Obama has already stated that he intends to cut costs in Medicare by $500 billion. Unfortunately, the Congressional health care bill indicates that government, and not patient choice, is going to decide what advanced medical procedures will be allowed for senior citizens. New hips, new knees, advanced cancer therapy, transplant surgery, and any high-cost procedure may be deemed too expensive for the elderly. This kind of quality reduction on seniors is seen in every socialized medicine system in Canada, England and Europe.
The only way Medicare can remain "uniquely American" is if Medicare reform is done without reducing quality. The only way Medicare can maintain quality is to make Baby Boomers pay to keep it that way. Baby Boomers about to retire can not be subsidized the way seniors currently are. Increasing co-pays for office visits will decrease usage. Raising the age when Medicare kicks in will decrease costs. Increasing the monthly fees on a sliding scale depending on income might make Medicare sustainable.
• Dan E. Rowe, M.D., is a founding partner of Skin Cancer and Dermatology Institute, with offices in Carson City, Reno and Fallon.