TED'S TAKE: WHAT IS MEDICARE FOR?

A recent NPR article caught my attention – not because of its subject but because it raises a fundamental question.

The article reported that HHS would not finalize a proposal to withhold Medicare and Medicaid funding from hospitals that provide pediatric gender-affirming care. Rather than debating whether that care should be covered, I found myself asking a different question:  What is Medicare for?

Every successful public program evolves over time. Medicare is no exception.

Created in 1965, Medicare was intended to provide health care coverage for older Americans, those eligible for Social Security at the time. Medicare also included spouses and disabled dependents. Medicare and Social Security were intended to work together. Over time, however, eligibility expanded. Individuals receiving Social Security Disability Insurance became eligible for Medicare and the definition of disability broadened.

Entire industries emerged to help people qualify for benefits, some on a contingency basis. Some individuals on cash assistance were defined “disabled” regardless of age and allowed into the Medicare program, and some younger folks with ADHA have also qualified for Medicare. The result? A steady increase in the number of people qualifying for Medicare at much younger ages than envisioned.

When Medicare was created, the program’s funding was based on assumptions about who would be covered and for how long. Expanding eligibility changes those assumptions.

Someone who enters Medicare when they are 65 may receive benefits for 20-30 years. Someone who qualifies much earlier because of expanded eligibility may receive coverage for many decades. This has significant implications for Medicare’s long-term financing. I’m not saying those newer to Medicare shouldn’t be included. I’m saying that covering these folks was never baked into the cost of Medicare; never part of its funding. Nor was the cost ever evaluated or legislation expanding the Medicare program examined in this manner.

This is a classic example of mission creep. Programs evolve beyond their original purpose, often through regulatory action. Expansion may be justified but should be evaluated based on its costs, its funding and its effect on people the program was originally intended to serve.

This lesson goes beyond Medicare. If you are going to spend more money and cover more people, do so knowingly and consciously.