I also thought that Medicare could use their clout to negotiate lower prices for drugs and services. The larger the client pool, the more clout.
Lo and behold, Robert Reich, President Clinton's labor secretary, wrote last Friday:
"So what’s the answer? For starters, allow anyone at any age to join Medicare. Medicare’s administrative costs are in the range of 3 percent. That’s well below the 5 to 10 percent costs borne by large companies that self-insure. It’s even further below the administrative costs of companies in the small-group market (amounting to 25 to 27 percent of premiums). And it’s way, way lower than the administrative costs of individual insurance (40 percent). It’s even far below the 11 percent costs of private plans under Medicare Advantage, the current private-insurance option under Medicare.I didn't realize Medicare's administrative costs were so much lower.
In addition, allow Medicare – and its poor cousin Medicaid – to use their huge bargaining leverage to negotiate lower rates with hospitals, doctors, and pharmaceutical companies.
Estimates of how much would be saved by extending Medicare to cover the entire population range from $58 billion to $400 billion a year. More Americans would get quality health care, and the long-term budget crisis would be sharply reduced."
-Why Medicare Is The Solution — Not The Problem, Robert Reich, July 22, 2011
He didn't mention the long-term reduction in health care costs wrought by preventative care. If you could somehow put a dollar figure on that and add it to his $400 billion savings estimate, the decision to extend Medicare to more people would make itself, no?