What Drives Healthcare Costs

Fully 3/5ths of health care is paid for by the government today. The most expensive is health care for seniors. If we want to lower health care costs for seniors, we have to stop covering some procedures. Ezra Klein criticizes Paul Ryan's proposal to privatize Medicare, saying that seniors will be less and less able to afford care because of the slower growth of the subsidy provided to buy insurance. How much does Medicare drive up health care costs today, though? What Klein ignores is that today we throw a huge amount of money at a finite resource to keep up the quantity of Medicare, which drives up costs for everyone. What happens when we decrease the this amount over time? Won't health care costs grow at a slower rate? How much slower? Yes, people with less money will have have more basic care, but what is the alternative?

Any solution has to involve a decrease in quantity of care. Whether you believe, as Ezra does, that a technocrat can decide for the whole country what care we should or shouldn't have, or you are with Ryan and think that people should decide on their own what they do and don't want covered is the argument. Klein seems to be framing the argument as the unsustainable version of Medicare we have today vs. what Ryan wants, which is misleading.