In a New York Times op-ed, my Ethics and Public Policy colleague Yuval Levin offers a simple, excellent idea that offers a way out of our current political impasse on entitlements.
He argues that Medicare and Social Security should be means-tested (e.g., allocating benefits according to need) and explains, with typical intelligence and clarity, why that’s something both Democrats and Republicans should be able to agree on. He writes:
Some on the left might complain that curtailing our entitlement programs’ universal character would undermine their social purpose and political support. But targeting benefits to those who most need them is surely better than reducing payments to providers (many of whom will drop out of Medicare), as President Obama’s 2010 law does. Some on the right might complain that such reforms would punish success. But surely rewarding achievement with government aid is no one’s idea of conservatism.
I simply want to add that Levin’s proposal not only would save money, which is urgent in and of itself; it would also alter the way we think about entitlement programs. As Levin puts it, means-testing Medicare would begin to treat it “less as a universal earned benefit and more as the transfer program that it effectively is.”
One of the hardest things to do in politics is to alter the way the public perceives things. But it can also be essential, the sine qua non for future reforms. And no institutions are more in need of reforms than our entitlement programs, which is why I hope this idea gets traction.
Medicare and Social Security are already means tested. The higher the income, the greater percentage of Social Security benefits are taxed. Also, the the higher the income, the greater the deduction from Social Security for medicare benefits. Nevertheless, if entitlemens are to be reduced, I suppose that higher income people should take a bigger reduction than lower income people.
What is the difference between "means tested" and good old-fashioned welfare? Welfare, say food stamps, is means tested. For example, if your income is a certain level you qualify for food stamps. If your income is high then you cannot get food stamps. It's simple and effective. People who need the help can get it. n nIs not this idea the same for what Messrs. Wehner and Levin propose? The nation would treat medical care in that same manner. It's welfare but for medical care. n nWe should call it that: Welfare Medical Care. It's clear and would we avoid confusion by imprecise language. It has a certain ring, too. n nNow is that a good idea? It sure is. Medicare is on track to bankrupt the nation and if Welfare Medical Care will save it so that the elderly have care (which they need) then the nation should try it. Will it work? Well, what we have now is clearly destined for financial disaster and this proposal certainly has merit. Sounds like a plan.
BC/BS makes Medicare the primary payer for retired policy holders that way reducing the cost of its insurance. If medicre is changed the cost of private insurance will increase.