ENTITLEMENT MENTALITY
In Saturday's NYT, Gina Kolata has a remarkable report on the cavalier way in which older Floridians exploit their Medicare benefits. They're not doing anything wrong, of course, just using the system as it was designed. Give people a valuable good for free, and they'll consume lots of it, especially if they have lots of time on their hands.
Doctor visits have become a social activity in this place of palm trees and gated retirement communities. Many patients have 8, 10 or 12 specialists and visit one or more of them most days of the week. They bring their spouses and plan their days around their appointments, going out to eat or shopping while they are in the area. They know what they want; they choose specialists for every body part. And every visit, every procedure is covered by Medicare, the federal health insurance program for the elderly.
Boca Raton, researchers agree, is a case study of what happens when people are given free rein to have all the medical care they could imagine. It is also a cautionary tale, they say--timely as Medicare's fate is debated in Congress--for it demonstrates that what the program covers and does not cover, and how much or how little it pays, determines what goes on in a doctor's office and why it is so hard to control costs.
South Florida has all the ingredients for lavish use of medical services, health care researchers say, with its large population of affluent, educated older people and the doctors to accommodate them. As a result, Dr. Elliott Fisher, a health services researcher at Dartmouth Medical School, said, patients have more office visits, see more specialists and have more diagnostic tests than almost anywhere else in the country. Medicare spends more per person in South Florida than almost anywhere else--twice as much as in Minneapolis, for example.
But there is no apparent medical benefit, Dr. Fisher said, adding, "In our research, Medicare enrollees in high intensity regions have 2 to 5 percent higher mortality rates than similar patients in the more conservative regions of the country."
Read the whole thing. And remember the "solution" that kicks in when this near-infinite demand for care starts busting the federal budget: price controls on reimbursement rates. While seniors are lining up for specialists, internists and family practitioners are turning away new Medicare patients, because reimbursements are so low they don't cover costs. Because free supplies inevitably pump up demand, a drug entitlement will surely cost many times the current estimate, and then when sticker shock sets in we'll get price controls.
Ten years ago, Steve Hayward and Erik Peterson published this cautionary tale in Reason, describing how Medicare spending grew far beyond expectations:
The two primary lessons of Medicare are the chronic problem of woefully underestimating program costs and the impossibility of genuine cost control. A closer look at Medicare shows why these two problems are certain to plague a government-administered universal health-care plan.
The cost of Medicare is a good place to begin. At its start, in 1966, Medicare cost $3 billion. The House Ways and Means Committee estimated that Medicare would cost only about $ 12 billion by 1990 (a figure that included an allowance for inflation). This was a supposedly "conservative" estimate. But in 1990 Medicare actually cost $107 billion.