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Jackie Wolf: Happy Birthday, Medicare — the best form of health insurance

The good news is they no longer, each year, have to read through charts and tables of private insurance company policies with different benefit levels, different deductibles, different co-pays and different premiums to find an affordable policy. When you are eligible for Medicare, you really have a great deal more peace of mind and health care security.

For almost 50 years, Medicare has provided millions of Americans with health insurance — in fact, approximately 37 million people in 2012 in all 50 states. It is a tested, proven United States model of good, government-run health insurance. Medicare operates efficiently and effectively paying 97 cents of every dollar on direct health care services. Medicare provides doctors and researchers with volumes of data on medical procedures and outcomes searching for the best approaches to treat and cure disease and illness. Medicare also covers an annual physical for all enrollees as well as fitness programs.

Compare those facts to the reality of the private insurance market. I challenge you to find any private insurance company that spends 97 cents of every dollar collected on direct health care services. With their high executive salaries, high budgets for marketing and advertising, and hundreds of denial-of-claims clerks, private insurers struggle to meet the mandated level of paying out 90 cents for every dollar collected on health care services.

Marilyn Tavernner, administrator for the Centers for Medicare and Medicaid Services is paid an annual salary of $143, 800. Compare that to the salary of Andrew Dreyfus, CEO of the Blue Cross Blue Shield of Massachusetts, who earned $1.1 million in 2011 (and that does not include benefits to which he is entitled). Remember: Blue Cross Blue Shield is a non-profit. In addition, the 17 directors of Blue Cross Blue Shield of Massachusetts are paid $47,000 to $54,500 each to show up for 10 meetings a year.

Private health insurers spend so much on marketing and advertising because they are looking for healthy people. They want to attract younger, active people and sell them policies – that’s called “cherry picking” — while avoiding, and, if possible, getting rid of older, sick people — that’s called “lemon dropping.” Many Massachusetts residents are speaking out for single payer for Massachusetts — or Improved Medicare for All Massachusetts.

They are tired of the fact that their health insurance is tied to their employment. They are tired of the fact that their employers have a say in what benefits are available. They are tired of filling out pages of paperwork to file claims for benefits they have paid for. And they are tired of all the bills for premiums, co-pays and co-insurance.

Physicians are, likewise, getting fed up dealing with the private health insurance market. Just this past week, I was talking with a graduate student whose mother is a psychiatrist. He told me his mother spends approximately 20 percent of her time filling out paperwork to get payment from the multitude of insurance companies. And that doesn’t cover the time she spends on the phone challenging the denials of treatments for her patients. It’s frustrating, discouraging and wrong.

We don’t need private insurance companies as middlemen. A state single payer health care plan — an improved Medicare for All Massachusetts plan (Senate bill S515) would insure all residents and guarantee quality, affordable care to all. Let’s look to the model of Medicare and enjoy health care security from cradle to grave. Happy Birthday Medicare!

Jackie Wolf is chair of the League of Women Voters of Amherst Health Care Committee.

Legacy Comments3

Its sad how ignorant people really are, especially here in the sticks. What really happened in the financial crisis was that the government mandated that banks make real estate loans to people who could not afford it as part of the community reinvestment act that Bill Clinton signed into law. Fannie Mae and Freddie Mac, the two quasi public institutions that set lending requirements implemented these new rules and the banks went out and made the bad loans and Fannie and Freddie bought back the loans like they always do. Both of these institutions were run by democratic hacks like Howell Raines who was Bill Clintons budjet director at one point. As always the banks and other global investors hedged their positions by purchasing derivatives. This is such basic stuff for anybody not to understand at this point its amazing. Then, the international accounting standards board made a new rule called "mark to market". This happened at the same time that a cyclical secular downtrend in real estate prices occured that caused banks and insurance companies to start to show losses on their real estate portfolios. Before this accounting rule change these institutions had the ability to value their real estate portfolios on a cash flow basis so they could even out the values over the secular cycles of increasing and decreasing real estate prices (they could say that over time most loans would be paid back and use the projected cash flow as the basis for valueing their holdings). With mark to market valuation the banks were forced to assume they had to sell the loans on the day of valuation and use that as the assets value on their books. This brought down the value of the loan portfolios dramatically. Derivatives actually saved the global money system because deriviatives allowed spreading the risk of default. Then what happened is the central banks injected deposits into the banks because by law banks are required to keep a certain amount of capital in their treasuries. Thats what was called tha banking bailout but it was not really that - it was just the injection of capital. The bankers who ran the money center banks did not want the money, a gun was put to their heads and they were told by Hank Paulson and Sheila Baer (the former Umass professor) to do it otherwise they would be replaced by people who would since the FDIC which Baer ran had the power to remove senior executives at any federally chartered bank. All of this capital was paid back by the banks and the government made a heafty profit actually unlike the bailout of the labor controlled car companies where we tax payers lost money. To save the money flows of the planet from stopping (called the velocity of cash), the central banks are now pumping out unbelievable amounts of money so the banks can stay alive. The banks get money at no cost and loan it to people and corporations at very low interest rates but enough to keep the the financial institutions from collapsing. Every central bank in the world is doing this right now (this is called quantitative easing). Oddly enough at the same time they are imposing enormous fines on the banks and taking alot of the money back this way (its really just extortion by a different name). Its caused the current stock market rally because alot of the money is ending up in the markets because companies are using the money to buy back shares and investors are using to buy stock. Anyway this is causing a massive debt bubble that could implode at anytime and cause the final leg of the financial collapse. The problem is that when this happens it could lead to incredible problems and ultimately world war 3. Thats what we have to worry about. The government caused debt bomb that the democrats, progressives and socialists have caused.

Personally, I can’t see why anyone but the insurance industry would come out against a single payer system. The insurance industry, by the way, is part of the financialization of the global economy where hedge funds and real estate have do some much damage to the 99% via Wall Street speculation and too-big-to-fail social and political manipulation. Jackie Wolf is a loud voice in defense of humanity and reason.

My first reaction reading the first paragraph was "What planet does this person live on?" Then I quickly scanned to the bottom and saw the Amherst address, answering my question. Maybe insurance agents stop calling when you reach 65 (because I think it is against the law unless you call them first). Instead, for the year before you reach 65, you get approximately 1000 mailings from the government concerning all the different permutations of Medicare and from insurance companies selling Medigap supplemental insurance (Original Medicare has very large deductibles and co-pays), public Part C Medicare Advantage health plans (Original Medicare has not annual out of pocket spending limit), standalone Part D drug plans (Original Medicare has no self-administered-drug coverage), dental/hearing and vision insurance (not included in Original Medicare), long term care insurance companies (not covered in Original Medicare or supplements), travel insurance companies (Original Medicare does not cover you outside the United States, not even in Niagara Falls, ON or Halifax), doctors office offering great deals on physicals (Original Medicare only covers one physical for the rest of your life), and reverse mortgages to pay for all the insurance you need once you turn 65. What could this person possibly mean that people over 65 do not "have to read through charts and tables of private insurance company policies with different benefit levels, different deductibles, different co-pays and different premiums to find an affordable policy?" Has this person never received the annual "Medicare and You "booklet? The rest of the article is equally full of nonsense, not the least of which is the claim that Medicare is efficient. Has this person never seen the news articles about the claims (some made by Massachusetts gubernatorial candidate Donald Berwick) that the fraud and abuse in Medicare approaches 25% of expenditures? I accept your challenge Mr. or Ms. Wolf that I can find private insurance companies that do not have that 25% useless administrative expense. I would say none of them has such a high administrative expense

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