According to the president and some leaders in Washington, it appears that cutting Social Security benefits will not be a part of a deal to avoid the fiscal cliff. That's good news. However, Medicare and Medicaid should also be off the table in these discussions because many seniors desperately need the coverage these programs provide.
We must not forget that prior to Medicare's debut in 1976 half of all seniors couldn't afford health insurance. For the millions of seniors whose sole income is Social Security, Medicare is an affordable lifeline that they can depend on. Which is why any proposal that shifts more of the costs onto seniors is unfair. And, using income as a means of determining Medicare premiums is very risky. Wealthier people could easily abandon support for Medicare, which will make it harder to keep the program affordable for everyone else.
Obviously, the older people get the more expensive they are to insure. So raising the eligibility age for Medicare would simply create a population of clients who are more needy and the disenfranchised would be seeking medical care through less efficient private systems. Private insurance works on the other end of the spectrum, gaming the system all they can to insure only people who do not need it.
This may be counterintuitive but lowering the age of eligibility for Medicare, say to 55, would insure a population of healthier patrons who paid the same fees, thus improving the funding for Medicare. Carry this principle as far as you like. Any economics textbook says a monopoly is more efficient than an oligopoly: a single-payer system would eliminate huge administrative expenses. Dare I say it? We could extend Medicare to everyone.
This sounds radical until you realize that the United States is the world's only industrialized nation that does not have a national health care system. And our system is far from the best. What it is, is by far the most expensive.
From its beginning the processing of Medicare claims was contracted out to private companies. A voucher system that privatized the whole program would be a travesty.