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Viewpoints: It’s time to unleash Medicare’s market power

By Brian Higgins
Special to The News

For the past eight months, President Trump and Senate Republicans have failed to enact “repeal and replace” legislation to the Affordable Care Act, aka Obamacare.

Their efforts and Congress’ seven-year near obsession with “repeal and replace,” while humiliating and overly dramatic, did provide Americans with the opportunity to better understand Obamacare, and its consumer protections against private insurers, and of the resilience and enduring popularity of Medicare.

It’s time for Congress to get serious about building on the many good aspects of Obamacare and Medicare. There is a common-sense way forward that Trump and congressional leaders should embrace to avoid further humiliation and deliver a serious health insurance option to the American people, one that will cut costs and deliver better care by using the market power of the best public option that already exists.

Reps. John B. Larson and Joe Courtney, Democrats from Connecticut, and I, along with 35 original co-sponsors, have introduced H.R. 3748, the Medicare Buy-In and Health Care Stabilization Act in the U.S. House of Representatives.

This Medicare for More legislation would allow Americans ages 50 to 64 to buy into and receive coverage from Medicare, the nation’s most popular health insurance program.

Medicare for More would reduce annual premiums by 40 percent and provide excellent health insurance without additional costs to the federal budget.

Americans 50 to 64 buying into Medicare would pay their full premium costs until they become eligible at 65 for traditional Medicare, and coverage that they paid for through their working years.

Medicare is very popular among its beneficiaries and across the political spectrum.

In fact, according to the Henry J. Kaiser Family Foundation, the satisfaction rate for Medicare beneficiaries is nearly 90 percent among Republicans, Democrats and independents alike.

That is why our list of co-sponsors is growing and has the potential to attract Republican support.

Medicare, with 57 million beneficiaries, uses its market leverage to control costs and enhance coverage quality. Medicare also has low administrative costs and always covers pre-existing conditions.

The provider network, consisting of hospitals and doctors, widely accepts Medicare patients because the program offers reliable and timely cost reimbursement.

In fact, because of this, 98 percent of Medicare beneficiaries have access to both primary care doctors and physician specialists. Our bill would also help stabilize the private insurance market, cut prescription drug costs and help small businesses and their employees.

Private insurers could compete for the under 50 population, a population of more than 100 million and a population that is attractive to private insurers because they are younger and use less health care.

Creative insurance products for this population focused on prevention and healthy lifestyles would create robust competition, lowering costs and helping to achieve a healthier future Medicare population.

After all, the best health insurance programs are those that offer strong preventive care to keep people healthy and out of the health care system.

Why do we target the 50 to 64 population in our bill? There is clear and compelling evidence that this population of nearly 62 million Americans is to the 21st century what the traditional Medicare population was to the 20th century. That is that private insurance doesn’t want to cover this population because they are older and use more health care. And if the private insurers do offer coverage, the cost is prohibitively high with expensive co-pays and deductibles.

For example, under the previous Republican House and Senate bills, according to the Congressional Budget Office, people ages 50 to 64 would have experienced massive premium hikes, in some cases exceeding nine times their current annual costs and consuming, in several scenarios, 40 percent of their annual income. That is perhaps why Trump reportedly characterized the House-passed bill as “mean” in meeting with Senate Republicans as they started their first debate on health care legislation earlier this year. That legislation ultimately failed, much like the recent defeat of the Graham-Cassidy bill.

More Medicare cost savings could be realized through negotiating volume discounts with America’s drugmakers. That’s why our bill would authorize the secretary of Health and Human Services to use the market power of Medicare to negotiate drug discounts.

According to the Commonwealth Fund, the Medicaid program, the Department of Defense and Veterans Affairs each achieve nearly 25 percent in annual drug discounts for their beneficiaries through negotiations.

Medicare, with 57 million beneficiaries and potentially tens of millions more, could achieve these savings and more.

Finally, our bill would provide real cost savings to the nation’s tens of millions of small businesses and their employees. Private health insurers don’t like to cover small groups and prefer to spread risk over large populations. This situation leaves our nation’s small businesses vulnerable to expensive and inadequate coverage.

Medicare for More would offer small businesses and their employees the benefits of Medicare’s market leverage to achieve optimal cost savings and quality.

Medicare is time tested and offers excellent coverage for its patients and stability for America’s vast provider network of doctors and hospitals.

Medicare for More would offer the benefits of a public option without the complexity of designing a new program. Medicare works well and Congress should approve this plan to make it work well for even more Americans.

Brian Higgins, D-Buffalo, is representative for New York’s 26th Congressional District.

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