12/17/2024    Stephen M. Pribut, DPM

Assassination of UHC CEO (Jon Purdy, DPM)

Dr. Purdy raises a provocative critique of
Medicare, arguing that it is fiscally
unsustainable and fundamentally flawed in design.
However, his suggestion that individuals would be
better off saving and investing the money that
goes toward Medicare taxes is deeply flawed and
fails to address the realities of healthcare
costs, financial behavior, and the role of social
safety nets. Furthermore, the increasing
privatization of Medicare through Medicare
Advantage plans has introduced additional
challenges, including denials of care,
administrative burdens, and profit-driven
practices that harm both patients and
practitioners. Let's examine these issues in
depth.

Medicare's Purpose and Evolution

Medicare was created in 1965 to address a dire
need: millions of older Americans lacked access to
affordable healthcare. Before Medicare, the
private market largely failed to serve this
population, leaving many seniors without coverage
or care. Over nearly six decades, Medicare has
significantly improved healthcare access, quality,
and outcomes for older Americans, reducing poverty
and increasing life expectancy among this
demographic.

However, Medicare's sustainability has always been
a concern, and its evolution has introduced new
complexities. The introduction of Medicare
Advantage (MA) plans, which allow private insurers
to manage Medicare benefits, was intended to
foster competition and innovation. Unfortunately,
as private insurance's role in Medicare has grown,
so have its negative effects on patients,
providers, and the healthcare system.

The Myth of "A Million Dollars for Healthcare"

Dr. Purdy's argument that individuals could save
and invest the equivalent of Medicare taxes to
create a $1 million healthcare fund by retirement
is appealing in theory but unrealistic in
practice. Several critical issues undermine this
assumption:

1. Healthcare Costs Are Unpredictable and Often
Catastrophic

Health needs are not confined to old age. Many
people face significant healthcare expenses in
their 20s, 30s, or 40s due to accidents, chronic
illnesses, or other unexpected events. Without a
safety net like Medicare, these costs could
deplete savings long before retirement. For
example, a major car accident or cancer diagnosis
can generate medical bills of hundreds of
thousands of dollars--expenses that most young
adults could not cover.

2. Rising Healthcare Costs Outpace Savings Growth

While savings might grow over time through
investment, healthcare inflation often outpaces
standard inflation. The rising cost of treatments,
medications, and long-term care can erode the
purchasing power of saved funds. This makes it
unlikely that even disciplined savers would
accumulate enough to cover the full range of
healthcare needs.

3. Many Americans Struggle to Save

Behavioral economics shows that individuals are
not always rational or disciplined savers. Social
Security is a case in point: it was created
because many Americans failed to save adequately
for retirement. Today, nearly 25% of Americans
have no retirement savings, and many others have
insufficient funds. Expecting individuals to
reliably save for healthcare--an unpredictable and
often overwhelming expense--ignores these
realities.

4. Insurance Is Designed to Pool Risk

One of the core principles of insurance is risk-
pooling, where the healthy subsidize the sick and
the young subsidize the old. This collective
approach ensures that everyone has access to care
when they need it. Eliminating Medicare in favor
of individual savings would leave each person
bearing their own risk, potentially leading to
devastating outcomes for those who experience
early or costly health crises.

Challenges with Medicare Advantage

The privatization of Medicare through Medicare
Advantage plans has compounded the system's
challenges. While MA was intended to increase
efficiency and choice, its implementation has
created new problems:

1. Denial of Care and Dropping Clients

Medicare Advantage plans often prioritize profits
over patient care. Reports of denied medically
necessary treatments and dropping high-cost
clients are troubling and undermine the trust that
patients place in the system. Traditional
Medicare, by contrast, does not engage in such
practices to the same extent.

2. Administrative Burdens

Private insurers impose excessive chart requests,
audits, and documentation requirements on
practitioners, creating an administrative burden
that diverts time and resources away from patient
care. This inefficiency frustrates providers and
reduces the quality of care delivered.

3. Up-charging Medicare Without Practitioner
Rewards

MA plans frequently up-code patient diagnoses to
receive higher reimbursements from Medicare, but
these additional funds often do not benefit
providers or patients. Instead, they inflate
insurer profits while practitioners face
increasing financial strain.

4. Market Distortion and Reduced Transparency

Medicare Advantage removes millions of
beneficiaries from traditional Medicare, reducing
its negotiating power and creating distortions in
the healthcare market. Unlike traditional
Medicare, MA plans often impose restrictive
networks and opaque billing practices, limiting
patients' access to care.

Broader Impacts of Eliminating Medicare

Dr. Purdy's proposal to eliminate Medicare would
have far-reaching consequences:

1. Young Adults Would Struggle to Afford Care

Without Medicare or private insurance, individuals
in their teens, 20s, and 30s would face
significant financial hardship when confronted
with urgent healthcare needs. Many would forgo
care, leading to worse health outcomes and higher
long-term costs.

2. Healthcare Costs Would Bankrupt Many

Even diligent savers could see their funds wiped
out by a single catastrophic health event. Those
with chronic conditions or high-cost illnesses
would be disproportionately affected, potentially
leaving millions destitute.

3. Health Disparities Would Worsen

Eliminating Medicare would exacerbate existing
health inequities, as low-income individuals and
those with limited financial literacy would be
least able to save for healthcare. This would
deepen disparities and strain other social
services.

4. Economic Instability

The absence of Medicare would destabilize private
insurance markets, driving up costs and reducing
access. Employers and individuals alike would
struggle to navigate a fragmented and inequitable
system.


Toward a Better Solution: Reforming Medicare

Rather than dismantling Medicare, we should focus
on reforming it to address inefficiencies, promote
equity, and ensure sustainability. Key reforms
include:

1. Reducing Administrative Costs

Streamlining Medicare's bureaucracy and reducing
wasteful practices could free up funds for patient
care and lower overall costs.

2. Negotiating Drug Prices

Allowing Medicare to negotiate directly with
pharmaceutical companies could lead to significant
cost savings, as demonstrated by other countries.

3. Improving Oversight of Medicare Advantage

Stricter regulations are needed to ensure that MA
plans prioritize patient care over profits. This
includes reducing care denials, expanding
networks, and holding insurers accountable for
upcoding practices.

4. Strengthening Traditional Medicare

Preserving and enhancing traditional Medicare's
benefits--such as by adding dental, vision, and
hearing coverage--would make it more competitive
with MA plans and provide better care for
beneficiaries.

5. Promoting Preventive Care

Encouraging healthier lifestyles and investing in
preventive care can reduce long-term healthcare
costs and improve population health.

The idea that individuals could save their way to
healthcare security is an attractive but flawed
concept. Healthcare needs are unpredictable, costs
are often catastrophic, and many people struggle
to save even for predictable expenses like
retirement. Programs like Medicare exist because
they address these realities, providing a safety
net for all Americans.

Medicare is not without its flaws, particularly
with the growing privatization through Medicare
Advantage. Which I and many others feel is flawed
and corrupt. However, the solution is not to
eliminate Medicare, but to reform it. By
addressing inefficiencies, holding private
insurers accountable or eliminating Medicare
Advantage entirely, and prioritizing patient-
centered care, Medicare can continue to fulfill
its mission as a cornerstone of America's
healthcare system.

Stephen M. Pribut, DPM, Washington, DC

Other messages in this thread:

---

12/17/2024    Stephen M. Pribut, DPM

Assassination of UHC CEO (Jon Purdy, DPM)

Dr. Purdy raises a provocative critique of
Medicare, arguing that it is fiscally
unsustainable and fundamentally flawed in design.
However, his suggestion that individuals would be
better off saving and investing the money that
goes toward Medicare taxes is deeply flawed and
fails to address the realities of healthcare
costs, financial behavior, and the role of social
safety nets. Furthermore, the increasing
privatization of Medicare through Medicare
Advantage plans has introduced additional
challenges, including denials of care,
administrative burdens, and profit-driven
practices that harm both patients and
practitioners. Let's examine these issues in
depth.

Medicare's Purpose and Evolution

Medicare was created in 1965 to address a dire
need: millions of older Americans lacked access to
affordable healthcare. Before Medicare, the
private market largely failed to serve this
population, leaving many seniors without coverage
or care. Over nearly six decades, Medicare has
significantly improved healthcare access, quality,
and outcomes for older Americans, reducing poverty
and increasing life expectancy among this
demographic.

However, Medicare's sustainability has always been
a concern, and its evolution has introduced new
complexities. The introduction of Medicare
Advantage (MA) plans, which allow private insurers
to manage Medicare benefits, was intended to
foster competition and innovation. Unfortunately,
as private insurance's role in Medicare has grown,
so have its negative effects on patients,
providers, and the healthcare system.

The Myth of "A Million Dollars for Healthcare"

Dr. Purdy's argument that individuals could save
and invest the equivalent of Medicare taxes to
create a $1 million healthcare fund by retirement
is appealing in theory but unrealistic in
practice. Several critical issues undermine this
assumption:

1. Healthcare Costs Are Unpredictable and Often
Catastrophic

Health needs are not confined to old age. Many
people face significant healthcare expenses in
their 20s, 30s, or 40s due to accidents, chronic
illnesses, or other unexpected events. Without a
safety net like Medicare, these costs could
deplete savings long before retirement. For
example, a major car accident or cancer diagnosis
can generate medical bills of hundreds of
thousands of dollars--expenses that most young
adults could not cover.

2. Rising Healthcare Costs Outpace Savings Growth

While savings might grow over time through
investment, healthcare inflation often outpaces
standard inflation. The rising cost of treatments,
medications, and long-term care can erode the
purchasing power of saved funds. This makes it
unlikely that even disciplined savers would
accumulate enough to cover the full range of
healthcare needs.

3. Many Americans Struggle to Save

Behavioral economics shows that individuals are
not always rational or disciplined savers. Social
Security is a case in point: it was created
because many Americans failed to save adequately
for retirement. Today, nearly 25% of Americans
have no retirement savings, and many others have
insufficient funds. Expecting individuals to
reliably save for healthcare--an unpredictable and
often overwhelming expense--ignores these
realities.

4. Insurance Is Designed to Pool Risk

One of the core principles of insurance is risk-
pooling, where the healthy subsidize the sick and
the young subsidize the old. This collective
approach ensures that everyone has access to care
when they need it. Eliminating Medicare in favor
of individual savings would leave each person
bearing their own risk, potentially leading to
devastating outcomes for those who experience
early or costly health crises.

Challenges with Medicare Advantage

The privatization of Medicare through Medicare
Advantage plans has compounded the system's
challenges. While MA was intended to increase
efficiency and choice, its implementation has
created new problems:

1. Denial of Care and Dropping Clients

Medicare Advantage plans often prioritize profits
over patient care. Reports of denied medically
necessary treatments and dropping high-cost
clients are troubling and undermine the trust that
patients place in the system. Traditional
Medicare, by contrast, does not engage in such
practices to the same extent.

2. Administrative Burdens

Private insurers impose excessive chart requests,
audits, and documentation requirements on
practitioners, creating an administrative burden
that diverts time and resources away from patient
care. This inefficiency frustrates providers and
reduces the quality of care delivered.

3. Up-charging Medicare Without Practitioner
Rewards

MA plans frequently up-code patient diagnoses to
receive higher reimbursements from Medicare, but
these additional funds often do not benefit
providers or patients. Instead, they inflate
insurer profits while practitioners face
increasing financial strain.

4. Market Distortion and Reduced Transparency

Medicare Advantage removes millions of
beneficiaries from traditional Medicare, reducing
its negotiating power and creating distortions in
the healthcare market. Unlike traditional
Medicare, MA plans often impose restrictive
networks and opaque billing practices, limiting
patients' access to care.

Broader Impacts of Eliminating Medicare

Dr. Purdy's proposal to eliminate Medicare would
have far-reaching consequences:

1. Young Adults Would Struggle to Afford Care

Without Medicare or private insurance, individuals
in their teens, 20s, and 30s would face
significant financial hardship when confronted
with urgent healthcare needs. Many would forgo
care, leading to worse health outcomes and higher
long-term costs.

2. Healthcare Costs Would Bankrupt Many

Even diligent savers could see their funds wiped
out by a single catastrophic health event. Those
with chronic conditions or high-cost illnesses
would be disproportionately affected, potentially
leaving millions destitute.

3. Health Disparities Would Worsen

Eliminating Medicare would exacerbate existing
health inequities, as low-income individuals and
those with limited financial literacy would be
least able to save for healthcare. This would
deepen disparities and strain other social
services.

4. Economic Instability

The absence of Medicare would destabilize private
insurance markets, driving up costs and reducing
access. Employers and individuals alike would
struggle to navigate a fragmented and inequitable
system.


Toward a Better Solution: Reforming Medicare

Rather than dismantling Medicare, we should focus
on reforming it to address inefficiencies, promote
equity, and ensure sustainability. Key reforms
include:

1. Reducing Administrative Costs

Streamlining Medicare's bureaucracy and reducing
wasteful practices could free up funds for patient
care and lower overall costs.

2. Negotiating Drug Prices

Allowing Medicare to negotiate directly with
pharmaceutical companies could lead to significant
cost savings, as demonstrated by other countries.

3. Improving Oversight of Medicare Advantage

Stricter regulations are needed to ensure that MA
plans prioritize patient care over profits. This
includes reducing care denials, expanding
networks, and holding insurers accountable for
upcoding practices.

4. Strengthening Traditional Medicare

Preserving and enhancing traditional Medicare's
benefits--such as by adding dental, vision, and
hearing coverage--would make it more competitive
with MA plans and provide better care for
beneficiaries.

5. Promoting Preventive Care

Encouraging healthier lifestyles and investing in
preventive care can reduce long-term healthcare
costs and improve population health.

The idea that individuals could save their way to
healthcare security is an attractive but flawed
concept. Healthcare needs are unpredictable, costs
are often catastrophic, and many people struggle
to save even for predictable expenses like
retirement. Programs like Medicare exist because
they address these realities, providing a safety
net for all Americans.

Medicare is not without its flaws, particularly
with the growing privatization through Medicare
Advantage. Which I and many others feel is flawed
and corrupt. However, the solution is not to
eliminate Medicare, but to reform it. By
addressing inefficiencies, holding private
insurers accountable or eliminating Medicare
Advantage entirely, and prioritizing patient-
centered care, Medicare can continue to fulfill
its mission as a cornerstone of America's
healthcare system.

Stephen M. Pribut, DPM, Washington, DC