Life Without Medicare - Patients

Despite all the consequences of losing Medicare on hospitals and physicians, the most dramatic impact would be on the patients. Medicare was put into place because the over 65 population was a group of people that nobody wanted to pay to care for. Lawmakers then believed that the healthy population could pay for the elderly population in a cost shifting principle.

The only way Medicare could go away is for people to save for the medical care much like they do for their retirement. The common belief is that everyone can put their money in a tax-deffered account and then use it when they turn 65. This idea is ok, but the problem then becomes how do you save money for people who have none. Then, what do you do with the people who did not save their entire lives and then cannot afford care.

None of this will work.

The only idea that I would have is to begin to take the human element out of health care and reduce the marginal cost of care. This includes greater use of computers, machinery, and robotics that can outperform humans. While this may sound like science-fiction, the government needs to defer money from some of their Medicare programs and incentive research in these areas.

Life Without Medicare - Physicians

Physicians much like hospitals would be greatly effected by any dissolving of the Medicare system. I could be wrong, but I believe that physicians were a major driver of the implementation of Medicare in the first place.

I believe getting rid of Medicare would put physicians at the mercy of for-profit insurance companies and consumers. Each would have a different effect on how physicians practice medicine. For-profit insurers are getting less tolerant of the autonomy of physicians. There would be less creativity in the practice of medicine and more "by the book" medicine.

Consumers would also have an effect on the way physicians practice. Consumers can be very loyal to physicians that they have had for many years, but that exists mainly for primary care physicians. Specialists however would have a more difficult time because they are less likely to have great customer service. Without the guarantee of payments from Medicare, physicians would find themselves in a less competitive position.

The prospect of the loss of Medicare would have a very dramatic effect on the way that physicians practice medicine and changing the way physicians practice medicine would ripple throughout the health care system.

Life Without Medicare - Hospitals

Take any business whether it be for profit or tax-exempt and tell them that they are going to lose half of their revenues and they are done. That's what would happen at many acute care hospitals if Medicare were to disappear.

The first thing that would happen is that hundereds of hospitals would likely close. This would take much of the excess capacity out of the system. Hospitals would then be faced with a population that would have to turn to the private sector for insurance.

Unfortunately, insurance companies are not going to be keen to pay for a population that is very likely to have a return on their investment. Therefore, the population is likely to pay for their own care.

In this circumstance hospitals are going to have to have the service of a hospital and the precision of an airline. Hospitals would have to being to provide real value to their patients. That means the feeling of wellness whether real or perceived must be provided to patients to the level of what hospitals are asking to be paid.

Come back for more on the effect of the dissolution of Medicare on hospitals.

No Medicare

What would happen if Medicare went away tomorrow? Obviously there would be chaos initially but after that how would the delivery of care change? Would hospitals close? Would physicians change the way they practiced medicine?