Understanding social insurance: Fairness, affordability, and the 'modernization' of social security and medicare

Health Affairs

Volumn 25, Issue 3, 2006, Pages

  Marmor, Theodore R ^a,b   Mashaw, Jerry L ^b  

^a YALE SCHOOL OF MANAGEMENT   (United States)

^b YALE UNIVERSITY   (United States)

Author keywords

[No Author keywords available]

Indexed keywords

AGED; FINANCIAL MANAGEMENT; HEALTH CARE POLICY; HUMAN; MEDICARE; METHODOLOGY; REVIEW; SOCIAL CHANGE; SOCIAL JUSTICE; SOCIAL SECURITY; UNITED STATES;

AGED; FINANCIAL SUPPORT; FINANCING, PERSONAL; HEALTH CARE REFORM; HUMANS; MEDICARE; SOCIAL CHANGE; SOCIAL JUSTICE; SOCIAL SECURITY; UNITED STATES;

EID: 33744765826     PISSN: 02782715     EISSN: 02782715     Source Type: Journal    
DOI: 10.1377/hlthaff.25.w114     Document Type: Review

References (56)

1. For critics, see, among others, P.J. Ferrera and M. Tanner, A New Deal for Social Security (Washington: Cato Institute, 1998);
2. and S.M. Butler, "Medicare Price Controls: The Wrong Perspective," Health Affairs 17, no. 1 (1998): 72-74.
3. For an example of a defense of this line of thinking, see S. Beard, J.L. Mashaw, and T. Marmor, "Is There a Social Security Crisis?" American Prospect 8, no. 30 (1997): 16-19.
4. See, for example, R. Pear, "Drug Plan Enrollment Opens amid Confusion," New York Times, 16 November 2005.
5. See "Social Security Plan Hits Shoals," Los Angeles Times, 27 June 2005;
6. for examples of President Bush's rhetoric on the subject, see G.W. Bush, "Remarks in a Discussion on Strengthening Social Security in Greece, New York," Weekly Compilation of Presidential Documents 41, no. 21 (30 May 2005);
7. and the New York Times transcript, "We Must Pass Reforms That Solve the Problems of Social Security," New York Times, 3 February 2005.
8. For different treatments, see M.J. Graetz and J.L. Mashaw, True Security: Rethinking American Social Insurance (New Haven, Conn.: Yale University Press, 1999);
9. N. Altman, The Battle for Social Security: From FDR's Vision to Bush's Gamble (New York: Wiley, 2005);
10. and T.S. Jost, "Private or Public Approaches to Insuring the Uninsured: Lessons from International Experience with Private Insurance," New York University Law Review 76, no. 2 (2001): 419-492.
11. Graetz and Mashaw, True Security, 15-66.
12. See, for example, J. Tobin, "The Future of Social Security: One Economist's Assessment," in Social Security: Beyond the Rhetoric of Crisis, ed. T.R. Marmor and J.L. Mashaw (Princeton, N.J.: Princeton University Press, 1988), 41-68;
13. see also T.R. Marmor, "Coping with a Creeping Crisis: Medicare at Twenty," in Social Security: Beyond the Rhetoric of Crisis, ibid., 177-199.
14. This is not the case for two programs conventionally regarded as examples of social insurance: unemployment insurance and workers' compensation. In these two cases, the injured or unemployed worker is the beneficiary, not the funder. Employers finance both programs, but their premiums varywith their experience. Experience rating with the unemployment or accident rate is meant to be a signal to the employer to orient toward prevention. Whether or not this has worked outwell is not a topic to be taken up here. For an argument that it has not, see Graetz and Mashaw, True Security, 73-87. Moreover, there are some forms of deservingness in U.S. social programs that do not depend on financial contributions. For example, workers are often viewed as having "traded" their rights to tort recovery for the more certain, but smaller, benefits of workers' compensation. And generous veterans' programs rely on the idea of contribution, but in the form of services provided (in war or elsewhere) rather than contributions in cash. Likewise, child allowances in the U.S. tax code can be regarded as social pooling of resources reallocated to children to produce a healthier, better-educated citizenry.
15. For illustrations, see E.D. Berkowitz, Robert Ball and the Politics of Social Security (Madison: University of Wisconsin Press, 2003);
16. T.R. Marmor, The Politics of Medicare, 2d ed. (New York: Aldine de Gruyter, 2000);
17. R.M. Ball, "The Original Understanding on Social Security: Implications for Later Developments," in Social Security, ed. Marmor and Mashaw, 17-40;
18. and Altman, The Battle for Social Security.
19. For examples of such language, see D. Durenberger, "Senator Durenberger's Crusade: Long-Term Care for All Americans," Caring 18, no. 9 (1999): 22-28;
20. and National Bipartisan Commission on the Future of Medicare, "Building a Better Medicare for Today and Tomorrow," 16 March 1999, http://thomas.loc.gov/medicare/bbmtt31599.html (accessed 27 February 2006).
21. For a discussion, see T.R. Marmor, "How Not to Think about Medicare Reform," Journal of Health Politics, Policy and Law 26, no. 1 (2001): 107-117.
22. M. Feldstein, "Rethinking Social Insurance," Presidential Address to the American Economic Association, 8 January 2005, http://www.nber.org/feldstein/aeajan8.pdf (accessed 27 February 2006).
23. P.J. Harmelink and J.F. Speyrer, "Social Security: Rates of Return and the Fairness of Benefits," CATO Journal 14, no. 1 (1994): 37-55;
24. and M. Feldstein and A. Samwick, "Social Security Rules and Marginal Tax Rates," National Tax Journal 45, no. 1 (1992): 1-22.
25. T.R. Marmor and G.J. McKissick, "Medicare's Future: Fact, Fiction, and Folly," American Journal of Law and Medicine 26, nos. 2 and 3 (2000): 225-253;
26. A. Negourney and J. Elder, "Bush Doesn't Share Public's Priorities, New Poll Indicates," New York Times, 3 March 2005;
27. and R. Morin and D. Russakoff, "Social Security Problems Not a Crisis, Most Say," Washington Post, 10 February 2005.
28. National Committee to Preserve Social Security and Medicare, "Disability Insurance and Survivors' Benefits," January 2006, http://www.ncpssm.org/news/archive/vp_surviorsbene (accessed 27 February 2006);
29. and G. Anrig, "Ten Myths about Social Security," 26 January 2005, http://www.socsec.org/publications.asp?pubid=507 (accessed 27 February 2006).
30. Social Security Administration, SSA's Performance and Accountability Report for Fiscal Year (FY) 2005: Management's Discussion and Analysis, http://www.ssa.gov/finance/2005/MDA.pdf (accessed 27 February 2006).
31. L.H. Thompson, "Paying for Retirement: Sharing the Gain," in In Search of Retirement Security, ed. T. Ghilarducci et al. (New York: Century Foundation Press, 2005), 115-125.
32. P.C. Light, The True Size of Government (Washington: Brookings Institution, 1999).
33. P. Passell, "Investing It: Can Retirees' Safety Net Be Saved?" New York Times, 18 February 1996.
34. For a discussion, see T.R. Marmor, J. Mashaw, and P. Harvey, America's Misunderstood Welfare State: Persistent Myths, Enduring Realities (New York: Basic Books, 1990), especially chap. 1.
35. D. Langer, "Does the Social Security Crisis Add Up?" New York Times, 16 January 2005.
36. See also Langer's testimony before the Senate Special Committee on Aging, 30 June 1998, http://www.ourfuture.org/issues_and_campaigns/socialsecurity/ key_issues/finances_of_social_security/readarticle801.cfm (accessed 27 February 2006).
37. For a discussion of Social Security financing, see R.M. Ball with T.N. Bethell, Straight Talk about Social Security (New York: Century Foundation Press, 1998).
38. R.M. Ball with T.N. Bethell, Straight Talk about Social Security 1998).Ibid.
39. The Social Security Advisory Board gives projections for such minor adjustments in its most recent report, Social Security: Why Action Should Be Taken Soon, September 2005, http://www.ssab.gov/documents/ WhyActionShouldbeTakenSoon.pdf, pp. 34-37 (accessed 27 February 2006).
40. P.Diamond and J. Geanakoplos, "Social Security Investment in Equities I: Linear Case," Working Paper no. 2 (Chestnut Hill, Mass.: Center for Retirement Research at Boston College, 1999).
41. Boards of Trustees of the Federal Hospital Insurance and Federal Supplemental Health Insurance Trust Funds, 2005 Annual Report, 23 March 2005, http://new.cms.hhs.gov/ReportsTrustFunds/downloads/tr2005.pdf (accessed 27 February 2006).
42. J. Oberlander, The Political Life of Medicare (Chicago: University of Chicago Press, 2003);
43. and Marmor, The Politics of Medicare.
44. C. Boccuti and M. Moon, "Comparing Medicare and Private Insurers: Growth Rates in Spending over Three Decades," Health Affairs 22, no. 2 (2003): 235.
45. T.R. Marmor, "From the United States," in Dutch Welfare Reform in an Expanding Europe: The Neighbours' View, ed. E. de Gier, A. de Swaan, and M. Ooijens (Amsterdam: Het Spinhuis, 2004), 111-134.
46. For some illustrations, see S. Butler and D.B. Kendall, "Expanding Access and Choice for Health Care Consumers through Tax Reform," Health Affairs 18, no. 6 (1999): 45-57;
47. and H.J. Aaron and R.D. Reischauer, "The Medicare Reform Debate: What Is the Next Step?" Health Affairs 14, no. 4 (1995): 8-30.
48. American Academy of Actuaries, Medical Savings Accounts: Cost Implications and Design Issues (Washington: AAA, May 1995), 2-8;
49. see also M. Moon, L.M. Nichols, and S. Wallin, "Winners and Losers under Medical Savings Accounts," Spectrum 70, no. 1 (1997): 26-29;
50. and L. Nichols, M. Moon, and S.W. Wallin, "Tax-Preferred Medical Savings Accounts and Catastrophic Health Insurance Plans," 1 April 1996, http://www.urban.org/url.cfm?ID=406690 (accessed 4 March 2006).
51. For discussion of the history of Medicare, see Marmor, Politics of Medicare.
52. Marmor, Politics of Medicare. Ibid.
53. Aaron and Reischauer, "The Medicare Reform Debate."
54. Boccuti and Moon, "Comparing Medicare and Private Insurers";
55. and Marmor and McKissick, "Medicare's Future," 238-245.
56. S.M. Lieberman et al., "Reducing the Growth of Medicare Spending: Geographic versus Patient-based Strategies," Health Affairs 22 (2003): w603-w613 (published online 10 December 2003; 10.1377/hlthaff.w3.603).