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November 03, 2003

Medicare "Competition" Would Kill System

A new study shows that forcing traditional Medicare to compete with private plans would kill the system:

Democrats generally oppose the idea, saying seniors who remained in traditional Medicare would face huge increases in their insurance premiums.

Their fear is that healthier seniors would migrate to less expensive private plans, leaving less healthy beneficiaries in traditional Medicare, a viewed shared by the majority of the 12 academics and health care experts whose work went into the report.

Insurance like Medicare works because the healthy and sick are in the same pool of patients. Competition will not end up being on efficiency but on which plan can screen out the sick and cherry-pick the low-cost healthy seniors. That will leave the sick and poor in an underfunded public Medicare system that can "whither on the vine" and die in Newt Gingrich's immortal phrase.

Posted by Nathan at November 3, 2003 04:35 PM