Currently, Medicare is not broke. A Google search will quickly inform you that most people agree that Medicare is not currently broke, but likely will be by 2018 due to rising costs. According to Kathy Kristof of CBS Money Watch, Social Security is slightly better off, and will not be broke until 2037. So what happens when these programs go broke? According to Kristof,² the government doesn’t have the authority to pay partial benefits, which will result in delayed disbursement checks. The government will be forced to wait until they have the money to mail out benefit checks. The greater the deficit, the later your check will be. Sounds a lot like the failure of “Cash for Clunkers.”³

While Medicare is not currently “broke,” I submit that it is “broken,” along with many other things about our healthcare system. We should be seriously looking at ways to overhaul the current system. As we all know, Pres. Obama has been talking about this problem since day one of his campaign. Many of you watched the speech he delivered to Congress on September 9 (see left sideblog), wherein the President finally gave specific details of the reform he envisions. Many details of implementation have yet to be worked out, but the President has growing support for his reform plans (my analysis of Pres. Obama’s speech is forthcoming).

My initial questions:

1. With Medicare and Social Security are on the brink of failure, why should we trust the government to “get it right” in the case of healthcare reform?
2. Pres Obama talked last week about building a future for America. Can we reasonably expect the government to come up with a robust long term solution?
3. Why start with complete overhaul, which seems risky at best? Why not start with a few smaller changes that would make a difference up front, then work toward some of the bigger changes?

UPDATE (9/18/09): I have answered my own questions in the comments. While I tend to favor market-based solutions over government intervention, I think legislation is critical to solving the current healthcare crisis in a timely manner.
—————————————————————————————————

¹ Admittedly, this is an anecdotal claim, inspired by a chain email recently circulated, bearing the subject “To the Congress.”

² Kristof cites personal correspondence with Bruce Schobel, president-elect of the American Academy of Actuaries.

³ “Cash for Clunkers” is formally known as the “Car Allowance Rebate System” (CARS). Congress budgeted 3 billion dollars for the program, and 2.877 billion dollars worth of applications were filed. It is highly likely that everyone will eventually get the promised rebate, even if it comes in the form of a tax credit.

On a lighter note, a classic moment is found at 21:40. Does anybody read lips? I really want to know what Nancy Pelosi is saying back there. Her expression is priceless!