Congress is getting all twisted up over health care policy again, and every time they do so it is generally a polemical skirmish regarding one of two things: A) how to deal with whatever problem the government created in health care; or B) how to deal with high costs, a problem largely created by government.

At the moment, the central brouhaha is about the expiration of COVID-era Obamacare subsidies, the extension of which is generally opposed by Republicans who argue, quite reasonably, the crisis which birthed the subsidies ended nigh on four years ago and, by the way, the elasticization of the definition of “Medicaid eligible” is sort of bankrupting us.

On the other side of the ledger, the fiscal liabilities of government-provided health care are now so ineluctable they are gradually becoming clear to even the most obdurate of progressives, who nonetheless continue to clamor for the extension of the subsidies. Looking about for a less egalitarian target on which to place the blame they settle on what is probably the one segment of government health care that actually functions reasonably well: Medicare Advantage, the alternative to traditional Medicare administered by (egad!) private insurance, funded by the federal government.

It’s that “private” element which causes so much consternation among the left. It is also, not coincidentally, the element responsible for the program’s popularity and success.

The provision of medical care for the elderly is among the most perennially vexing issues in health care policy. George Will illustrated the problem most coherently when he said, “what we did in 1965 is attach the most rapidly growing segment of our population — the elderly — to our most dynamic science — medicine — as an entitlement.” In 1965 the average life expectancy in the U.S. was about 68.5 years. Sixty years later, it is around 79. Medical progress has advanced at an incredible pace, enough so it has added an element of elasticity to individual mortality — i.e. the better the medicine, the better the chances one lives longer.

The corollary to this is how more people are alive, for longer, during the most medically expensive years of their life. Add to this fact the following datum: A) as a society we recognize and agree to the need for provision of medical care to the elderly; B) overutilization of the health care system — driven mostly by the fact in nearly every case the bulk of medical care is paid for by someone other than the recipient — is the principle cause of higher health care costs; and C) the free-market strictures that would correct B), are constrained by A).

The dilemma approaches intractability. Without the discipline of the price mechanism, the trend is toward overutilization; what’s more, it creates the situation where insurers — including government plans like Medicare and Medicaid — lose money on sick people, and adjust accordingly. Consider the Canadian health care system for instance — it’s fantastic if you are healthy and don’t need it, and damn near deadly if you do.

So, under the traditional Medicare model, which was created never anticipating the extraordinary advances in pharmacology and medical science of the last half century, there is a perverse incentive to overprovide for those who don’t need it and underprovide for those who do. To put it another way, without any sort of price mechanism on which to compete there is no incentive to provide more or better-quality service.

The Medicare Advantage model addresses this problem elegantly. First, since the plans are administered by competing private insurers, it manages to avoid at least some of the bureaucratic pitfalls inherent with government-run plans. Second, under the MA risk adjustment system, if an illness is diagnosed, or another change in a patient’s health status is observed, doctors can receive higher premiums from Medicare, reflecting the anticipated increased costs. Ergo, the plans are naturally more tailored to the individual, and, unlike traditional Medicare, providers and insurance companies are actually incentivized to offer more, and higher quality, services. This is how MA plans are able to offer a cornucopia of services unavailable within the traditional, fee-for-service Medicare model, i.e. dental, fitness, vision and hearing coverage, nutrition support, greater access to in-home care, and so forth.

The ultimate proof of the efficacy of the model is in its popularity. Between Jan. 1, 2020 and Jan.1, 2024, MA enrollment increased from 24.3 million to 33.5 million, 37.5%. Darren Grubb, a spokesman for Medicare Advantage Majority, a non-profit dedicated to protecting the program, was recently on a local radio show (the Jeff and Bill Show on 710 KNUS) explaining how 53% of Colorado Medicare-eligible seniors have left traditional Medicare and signed up for MA plans, numbers consistent with the national figures. Multiple surveys have demonstrated the program’s popularity not only with recipients but caregivers. Empirical studies have quantified the savings to both seniors and to taxpayers.

No program tainted with the original sin of government funding and oversight is perfect, and MA would benefit from a few structural tweaks that could further enhance competitiveness. But Congress should resist the collectivist urge to micromanage, standardize, or defund MA in an effort to hobble it to the homogenous, lowest-common-denominator government-run model they yearn for, a model that will serve only to make us sicker, poorer, or both.          

Kelly Sloan is a political and public affairs consultant and a recovering journalist based in Denver.