The Politics of Medicare

July 26, 1995

How the intellectual initiative has switched from the Democrats to the Republicans is visible in the fierce debate over Medicare -- potentially the decisive issue of the 1996 presidential election.

Thirty years ago the party of Lyndon Johnson was the agent of change as it enacted landmark health care for the elderly over the almost unanimous objection of GOP legislators crying "socialized medicine." This year finds the party of Newt Gingrich trying to control these enormously costly programs by moving them into the managed care arena already familiar to millions of working-age Americans. Meanwhile, Bill Clinton' Democrats find themselves defending the status quo.

While logic and market trends would seem to favor the Republican position, Democrats sense the political factor is very much on their side. As a result, they are making the most of the 30th anniversary of Medicare. At a Capitol Hill ceremony yesterday, President Clinton repeatedly chanted: "I'm not going to let the government mess around with your Medicare." He evoked nightmare scenarios in which senior citizens would be paying more for health care as private insurers cherry-picked to cover only the healthy. And all this, Mr. Clinton added, to offset the $280 billion cost of a Republican tax cut for the wealthy.

That Republicans are acutely aware of their political predicament is reflected in delays in revealing the details of the Medicare reforms promised in their "Contract with America." But as the congressional year moves toward the fiscal crunch stage, they will have to reveal their plans for saving $270 billion. Then comes the blunt truth: senior citizens, who vote in large numbers, will be contemplating a voucher system in which Medicare beneficiaries either have to enroll in HMOs or other managed care organizations or they will have to pay higher benefits to remain in the fee-for-service, pick-your-own physician system that now exists.

While Democratic rhetoric would seem to decry such an occurrence, it actually is one of the more predictable developments of the next decade as the nation strives to prevent Medicare's bankruptcy. Even President Clinton, in his fiscal 1996 budget, had this to say: "Increasing the role of managed care in Medicare and Medicaid can provide beneficiaries greater continuity of care, improve access to providers and provide the framework to assure quality. . . [I]ncreasing the role of managed care. . . can benefit from the revolution underway in the private health care market."

There is, of course, no reason to cry salt tears for the plight of the Republicans. They have put themselves in a vulnerable position by advocating huge tax cuts at the upper end of the income bracket that cannot be justified by the state of the economy or the overwhelming need to balance the federal budget. It would be too bad if sensible moves toward managed care in government health insurance programs were to come a cropper because of GOP tax greed and Democratic demagogy.

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