Raising Canes

The demonstrators on the 34th Street sidewalk move in fits and starts. Some whiz by in motorized wheelchairs, others loop around slowly, leaning on canes. But if the circle of elderly and disabled Medicare recipients appears somewhat ragged, it’s all the better to make their point: these people are in no shape to have their benefits cut, a prospect that looms large as health-policy types ponder the future of the benefits program in Washington.

The activists— members of the New York Network for Action on Medicare— have chosen this particular spot to parade around in surgical gowns and shout, “Vote right, Tony” because it is home to the headquarters of HIP Health Plans. Tony is Anthony Watson, HIP’s CEO and, more to the point of the demo, one of New York’s two representatives on the commission reporting to Congress on Medicare. Though Watson was still undecided at press time, his could be the deciding vote on a dramatic proposal that would raise the Medicare eligibility age from 65 to 67. And, despite the fact that dozens of HMOs around the country recently stopped serving the elderly because their contracts weren’t profitable enough, the proposal would also change what is now an entitlement program for the elderly and disabled into a system of vouchers to buy into private HMOs.

Such prospects are alarming to Petra Allende, a 78–year-old member of the Hispanic Senior Action Council. “If they increase the age, what is going to happen?” asks Allende. “We already have so many people who are uninsured.”

Medicare recipients also worry that HMOs— which now provide for fewer than 15 percent of Medicare recipients— won’t meet their needs. Anne Emerman, a 62–year-old who has used a wheelchair since she was seven, is especially concerned about people with disabilities. “We need specialists, rehab, expensive equipment. These are $17,000 to $20,000 a pop,” she says, gesturing to her own motorized wheelchair.

Despite such costs, the proposed changes would no doubt be a welcome boon for the managed-care industry. Billions of dollars that now directly pay medical bills for the 40 million Americans on Medicare would be redirected to private— and often for-profit— companies that take more money off the top than the government. (For-profit HMOs spend about 14 percent on overhead, compared to about 2 percent under the current Medicare program.)

Critics of the proposed voucher system fear patients would end up taking the hit for those losses. While HMOs initially cut down on health care costs, their participation in Medicare ended up being more expensive than having the government reimburse providers directly. If the federal vouchers don’t keep pace with costs of managed care, elderly patients’ share of costs could rise even beyond the 21 percent of their incomes they already spend on health care.

“People need to understand that money’s money,” says Adele Bender, a part-time secretary of “social-security age.” “These young people don’t understand. They say they don’t want taxes. But they just should forget about the words. They’re going to be begging for taxes if they find themselves with health care costs they can’t afford.”

In fact, the movement to revamp Medicare sprang from fiscal concerns recognized by both sides. As the program now stands, Medicare could run out of money as early as 2010, when many baby boomers will be hitting 65. But while the conservatives behind the official Medicare Commission’s proposal are trying to solve the crisis by shrinking the entitlement program, Medicare defenders— like those marching on the HIP offices— would instead expand it.

The advocates allied with the New York Network suggest adding coverage for prescription drugs and long-term care— services currently not covered by Medicare. The group says Medicare could pay for such extra benefits by adhering to a strict budget and cutting down on the overhead of private health companies. The Network predicts it could save $50 billion a year this way— and says that would be enough to extend Medicare to everyone in the country.

But the Medicare activists won’t be able to convince anyone that providing universal coverage is cheaper; it isn’t. The strength of their argument comes from their moral standing. “Everybody of all ages should have health care as a right,” says protester and retired businessman Sherman Hollander. “It’s like having three meals a day. Nobody should go hungry and nobody should go without health care.” Hollander walks unaided and has long had private insurance, but, at 78, he’s sensitive to the fleeting nature of health. “It’s a small, narrow road,” he says. “We can all slip off.”

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