I just signed up for Medicare. It is my understanding that Medicare does not pay for vision coverage; you have to get that through private insurance, either Part C or Medigap, both of which you will pay for. I have vision coverage in my part C which is supposed to include eyeglasses, though I have not tried to use it yet.
I agree, we *should* have started raising the minimum age back in the '80s, long before the Boomers were anywhere near retirement. Raising it 2 months per year (for people under 50) starting in 1980 would give us a retirement age of 69 yrs 4 mos today, and 70 years by the time I would be eligible (born 1960). That would have required me to work 5 more years -- a daunting prospect. But, if I had known 40 years ago that that would be the case, I would have made different late-career choices, instead of sliding into semi-retirement early.
A priority of the progressives for decades has been to nationalize healthcare. They are succeeding, with roughly half of procedure volume paid for by the Feds the last time I checked a decade ago. The tax advantage of health benefits was a nice arbitrage for employees, but now the costs are too high even so. Employers would love to shed the costs and the yelling and screaming of annual enrollment by handing the problem to government. This would have the unintended benefit or freeing up the labor market a lot.
I believe the majority of physicians are now employees, not the small business owners of the past. The few private carriers price off of Medicare, and the juice is not worth the squeeze if you're sub-scale. Between practice managers embezzling from them, their lack of training in business and management in today's compliance hell, and the cash crunch of a payer deciding to exercise their right of set-off, no sane physician would go into private practice. The difference in effort of an government employee versus a corporate employee versus an owner should be obvious to this audience, reducing capacity further.
For the bottom 50% of the population, this means their doctor of the future was going to be a nurse, just as I saw in the UK in 2007 in London. Updating, it will be interesting to see how much AI takes over diagnosis, with a pharmacist (or another AI) serving as quality control on prescription (in most countries, pharmacists have much more discretion than in the US).
For the richest 20% of the population, it will be concierge medicine, with check-ups and minor stuff paid for out of pocket and true insurance for catastrophic care -- the rich will not be waiting in line with the rest of us. For the 50-80th %ile, there may be a buy-up option for a bit better access and level of service, as in Australia, where my parents pay for "top-up" private insurance.
Bottom line, rationing will take take over more and more from price (I had to wait 6 months to see a GI doc in a major metro despite great insurance) and the elderly will continue to take from their (non-existent) grandchildren until the Ponzi scheme comes to an end. I have it on my list to review the IMF's standard restructuring recipe for how the baby gets divided up when that time comes.
I can't prove that you're wrong, but I would be willing to bet a lot of money that there will never be significant cuts in nominal outlays for Social Security or Medicare, either through reduced benefits or increased ages of eligibility. I think the problem will be "solved" with a combination of inflation and tax increases (probably income tax, so mostly paid by working-age adults). I guess this could well lead to something similar to what you describe - if in 20 years the dollar has devalued by, say, 80%, but the nominal value of Medicare benefits hasn't increased, then we would basically have a two-tier healthcare system.
Incidentally, I live in Germany, which has exactly the same problem of an increasingly bad dependency ratio. A German think tank recently came up with an interesting proposal to help with this problem: An additional 10% income tax only on retirees with incomes above a certain threshhold, to be redistributed to poorer retirees. This is one of the few attempts I've seen to solve the dependency ratio problem without either (a) even more immigration or (b) even higher taxes on adults in the stage of life where one starts or raises a family. Of course, it's wildly unpopular, with 65%-31% against. Only the youngest voters (18-29) favor it by a small majority.
19 pages and no timeframe, no mention of Japan & 250% ratio, no mention of how tariffs are a tax raising some $300 billion, about 1% of GDP. To frequently mention Trump without addressing tariffs is intellectually flabby, if not cowardly.
At best a B grade paper, tho listing 5 ways of resolving a crisis was a strong point.
Tim noted this problem might not be a crisis even in the next 10 years. I claim Japan will have this debt problem before the US, and what they do will be a big influence.
While Greg is first order correct that DOGE is cutting small govt programs, a huge benefit is establishing a fight against waste, fraud, and abuse. This crucially important because, until the govt programs are running with “all” the waste cut, all politicians will be promising to cut waste, not real voter-helping benefits.
Major reform of the US healthcare system, including nationalization/ socialism, is beyond the scope of AK’s post, or Greg’s debt note, much less a comment. But stopping illegals from getting govt benefits is an important reduction in abuse, yet Dems are already screaming about people losing coverage.
It’s not a crisis until Dems call it a crisis. And, like most bigger-govt Dems, the idea of higher taxes as the easy quick, tho admittedly painful, solution is the one Greg thinks is most likely. Most MAGA folk think more taxes on college endowments is much better than VAT. The lack of comparison of econ growth rates between VAT countries and the US is another weakness.
Finally, the chainsaw process of Argentina is the model I support, to cutting govt. it’s working well for Argentina, and would work well for any OECD country, and even China, but also USA.
Plus, even moving to a two- or multi-tiered health system, won't End the debt bingeing. Only a crisis, in Japan or some OECD country, will convince politicians that they have to cut spending.
"What I would prefer to happen is an increase in the age of eligibility for Social Security and Medicare. All along, that age should have increased along with longevity, so that we are not giving people on average more than a dozen years to live at taxpayers’ expense."
When Social Security started in 1935, the retirement age was set at 65. Life expectancy that year was less at about 61 for men and 65 for women. In other words, Social Security started with the expectation of benefiting less than half of all newborns, the half that would live to and beyond retirement age. I don't think we could get away with that standard nowadays, and don't think it's desirable either. But an age older than 67, the current full retirement age, would make sense.
Solving the Medicare (and Medicaid) problem is much more difficult. Social Security is mainly a matter of redistributing income subtracting a minor percentage for administrative costs. Medicare and Medicaid require money and real resources to meet their obligations - the supply of medical services (more doctors, PA's, nurses, et. al.), hospital beds, clinics, medical devices, and medications. Equilibrating supply of and demand for medical services will be very difficult without introducing more market influences into the picture. I suppose rationing will be the largest factor if only because it will be the most politically palatable. (Most Americans don't believe that markets are fair.)
Mankiw claims there are only 5 ways to deal with the rising debt to GDP ratio: “(1) extraordinary economic growth, (2) government default, (3) large-scale money creation, (4) substantial cuts in government spending, and (5) large tax increases.”
Each of these covers a lot of territory, so it might be worthwhile to tease out what may or may not be covered in each.
First, economic growth. This might be interpreted to include actions like the laudable efforts to put the federal government’s trillions in physical assets to higher returning uses. Auctioning off federal urban land holdings alone would raise revenues which would not be insignificant but moving the resources to more productive use would also increase the tax base. Indeed “expand the tax base” ought be considered a 6th way to deal with the rising debt. Similarly with mineral resources tied up under Antiquities Act monument designations. Repeal that godawful nightmare entirely and watch the economy grow. Unfortunately the worms in Congress were unable to wriggle off the eco-rent seeking industry hook to do the right thing this last time this option was offered.
Second government default. Perhaps the wisest option. Destroying the government’s ability to borrow ever again is the most moral, responsible legacy we could bestow upon our offspring. But it need not go that far. Reining in the interest component of the debt, by for example setting a statutory ceiling of 2% would help. Call controlling interest paid on the debt the 7th way.
Substantial cuts in government spending ought be considered as including cuts to tax expenditures. We might want to call this the 8th way. Tax expenditures are government revenue losses from tax exclusions, exemptions, deductions, credits, deferrals, and preferential tax rates. These are substantial amounts. For example, some 10% of American workers are employed by tax exempt organizations. This frivolity must be eliminated before we start talk about ripping old people off of their earned benefits. Simply repeal section 501 of the Tax Code and watch the economic distortions vanish and tax revenues grow.
Large tax increases might be supplemented with a 9th way, let’s call moderate tax increases. For example, raise $3 trillion for Social Security by eliminating the tax cap. Or a 10th way: small tax increases. “According to an analysis from the Social Security Trustees, increasing the payroll tax by 0.1 percentage point from 2026 through 2035 until it reached 13.4 percent would raise $601 billion in new revenues for Social Security over the next 10 years. The increase would shrink the program’s 75-year shortfall gap by 26 percent.”
And given that the Europeans hate us and are really not much more liberal than the Chinese and Russians and converging fast. And given that it appears that the Ukrainians hate us as well and are going t behave pretty much like the mujahideen did after we supported them in the Afghan war with Russia if they get the chance. And the new president of Mexico acts like she would like nothing better than a way with the United States, perhaps we ought to consider plunder as an option. Authorize mercenary groups and privateers to plunder our enemies so long as they pay taxes on the booty. Would probably help decrease defense arms research costs as well.
There's another way to get rid of Social Security: replace SSA accounts with indexed mutual funds. I found that if I had invested 1/4 of my FICA deductions in indexed mutual funds, a 5% withdrawal would match SSA benefits, with 3% (DJIA) and 5% (S&P 500) left over after the standard 2% yearly Fed inflation for continued growth and emergencies, and leaving an inheritable nest egg.
So add a 4% FICA payroll tax which would go into nest egg accounts. Yes, it's a 4% pay cut for everybody, but everybody got us into this mess, everybody has to get us out. Continue the FICA tax for existing benefits. All new SSA retirees get prorated per their reduced FICA deductions with the rest coming from those nest egg accounts. As existing FICA pensioners die off, the FICA tax can shrink. It would be 4% less in 7 years, and probably vanish altogether in 30 years, leaving an 11% pay raise for everybody and eliminating that huge entitlement budget item.
To prevent those nest egg retirees from blowing it in Vegas, any withdrawals more then 5% a year have to be approved by designated heirs, a couple of doctors, and some independent auditors.
You do know that your SS proposal doesn’t work because SS is a Ponzi scheme where current retiree benefits are paid by current taxes, right?
It’s a Ponzi scheme that CAN work given ever increasing GDP, but it’s still a Ponzi scheme.
Yes if you went back to the beginning (or hell, I don’t know, back to 1961) your proposal would be far superior. But it cannot be done today.
FYI, W Bush proposed something like this 20 years ago, and it got nowhere. Because the money ain’t there to make it work to deal with the transition. And 20+ years later the money problem is much greater than back then.
Here's the standard full length version of this I sometimes post:
I've posted versions of this before. I am no financial expert, and I know this is politically impossible. My purpose is to understand a "realistic" plan to convert SSA Ponzi pensions to private nest eggs. I am not saying this is perfect or possible, only that it is the best I could come up with.
The gist is that investing 1/4 of the FICA tax in private DJIA/S&P 500 indexed funds provides enough nest egg that a 5% annual withdrawal matches SSA pensions, and since the average annual return over the last 10 years is 10% (DJIA) and 13% (S&P 500), that still leaves 3%/6% capital growth over the Fed's 2% inflation target (my figures were pre-Bidenflation), and a good cushion for bad years.
* Keep the FICA tax on all workers to pay current SSA pensions. It will decrease from its current 15.3% over time as current pensioners leave the system. Everyone contributed to this mess, everyone has to pay to get out of it. Neither the Lone Ranger nor Harry Potter is coming to the rescue.
* All new SSA pensioners get reduced benefits based on the cutiiver date. The difference is made up from their new nest egg accounts. All employees keep paying FICA and get some prorated reduction in their buyout costs.
* Add a new 4% payroll tax which goes directly to individually owned DJIA/S&P 500 indexed accounts. Yes, all employees get a 4% pay cut. We all contributed to this mess, we all have to get out of it. When the 15.3% FICA tax drops 4%, the pay cut turns into an increasing raise.
* Raise the SSA minimum retirement age to 70 years. Average life expectancy is 80 years. If half of pensioners are dead in 10 years and the 15.3% FICA tax can be cut in half to 7.65%, it would drop 4% in 5 years. This is a gross simplification, but close enough for starters.
* As time goes buy, SSA pensioners die off or take a lump sum nest egg buyout. Since this is spendable and inheritable, its value can be less than the strict 10%/13% necessary to maintain their current SSA pensions.
* I *think*, as an uneducated uninformed wild ass guess, that the FICA tax would drop to 1-2% within 20-30 years, leaving only the 4% nest egg tax. That's a 10% raise for everybody. The FICA tax would only finally disappear when the last SSA pensioner dies in 50+ years, although at some point, it might be simpler to just top up the last few SSA pensioners' nest egg accounts and cut them loose.
* The new nest egg tax invests $500 billion a year into the stock market. 50 years (working age 20-70) of that will stabilize at $25 trillion. Google says current mutual fund capitalization is $56 trillion. I do not think adding $500 billion, 1%, every year would destabilize the stock markets.
* Whether the new 4% nest egg payroll tax remains mandatory is a political decision. I'd be perfectly happy to make my own decisions and risk ending up in a bunk bed charity, but do-gooders and sob sisters will latch on to every pensioner who blows it in Vegas or loses it to a con artist, and try to restore SSA. Insurance companies could play a part. Guardians who have to approve unusual withdrawals could play a part. Legally binding waivers could play a part. But those do-gooders and sob sisters will also play a part.
Please read my scheme again. It ADDS a 4% FICA tax for the new index fund nest eggs accounts while KEEPING the existing 15.3% FICA tax to pay off existing SSA pensioners. All new SSA pensioners get reduced benefits based on the switchover date, paid from the 15.3% FICA tax, with the balance made up from the new nest egg accounts.
* All current employees take a 4% pay cut because of the new 4% nest egg tax.
* Because there are no new full-strength pensioners, the 15.3% FICA tax shrinks. I think it would shrink by 4% in 7 years which eliminates the 4% pay cut, and continue shrinking, turning into an ultimate 11.3% pay raise when the last pension dies off and it finally vanishes.
The only way to get substantially better economic growth is to gut regulations. 90% at a minimum. Get rid of minimum wage laws, occupational licensing, zoning, building codes, CAFE standards and the rest of automotive mandates. None of them need to be government standards.
* Leave building codes to mortgage lenders and insurers.
* You can find automobile safety graphs, and cannot tell from the curves where federal regulations were introduced.
Nothing else will increase economic growth. It would have the nice side effect of getting people out of the mindset that Big Daddy knows best and only Big Daddy can solve society's problems, and force people to start relying on themselves and instead of pissing away so much money lobbying the government.
It would also force millions of bureaucrats, both government and private, to get honest productive jobs instead of leeching off everybody else. Nobody's life has been saved by NO STEP signs on the backs of ladders or all those California Prop 65 warning stickers.
That brings up another simple solution: loser pays court costs, all of them, everything that was spent by the other side -- lost wages, travel expenses, their own detectives -- and put a real damper on lawyers and their bullshit lawsuits which do nothing but enrich lawyers and stifle innovation. It will also make it easier for the poor with good cases to get legal aid, since their lawyers have a much better chance of getting paid.
Well, it’s not like the Centers for Medicare and Medicaid Services (CMS) program integrity programs are insufficiently lavishly funded. In 2024, the two major anti-fraud programs got $2.8 billion (from both discretionary appropriations and from the trust fund) and the HHS IG got another $555 million of which about half came from the trust fund. Part of the problem is that the program integrity activities made no secret about where their actual priorities lay. The 2024 Comprehensive Program Integrity Plan included “Advance Equity” and “Drive Innovation” as two of their 4 priorities. Funneling money to clientele groups to recycle as campaign donations is every federal agency’s top priority.
But targeting Medicare seems to be missing a rococo farrago forest of federal health programs for a tree. If you go to table 3.2, Outlays by Function and Subfunction in the Historical Tables volume of the Budget, you will see that for 2024 the outlays for subfunction 571 Medicare were $874.1 billion. And for this some 66 million people had health insurance coverage. But what did the public get for the $854.3 billion paid out in subfunction 551 “Health care services” and the outlays of $50.6 billion in subfunction 552 “Health research and training.” And throw another $138.5 billion on top in outlays for 703 “Hospital and medical care for veterans.” It is only because the invertebrates in Congress are incapable of lifting a finger that might displease an interest group that we are stuck with this completely untenable and unsustainable budgetary dystopia. It would be easy work to consolidate and simplify all of the federal health programs and even transfer operational responsibility to the states, but the money mostly benefits establishment types at the expense of the masses so corruption will rule until the whole sorry edifice implodes which no amount of Medicare cutting will do anything to prevent.
The higher aggregate levels of taxation in Europe are due to their use of value added taxes on consumption, usually at quite high levels - 25%. The US federal tax system, largely based on income tax, excessively burdens savings and investment, costing economic growth. Any politically feasible tax increase given this structure would tend to tank the economy. So what we have seen instead is debt financed deficits. I agree the most likely outcome is implicit rationing of government paid health care and devaluation of the debt through high levels of inflation, as the most politically expedient means of dealing with the problem.
Medical spending per unit population follows a nice power law. There's probably a second mode at end of life. I've seen end of life care; nobody should put up with more than a couple of weeks of that. My parents generation (Silents/Greatest) mostly followed that "couple of weeks" rule and it seemed less bad compared to the ones who didn't. I most likely will not put up with much end of life care myself.
We don't need two kinds of care. Because of "supply" latency - medical training takes a long time - differentiating the financing makes more sense. That ship has sort of sailed; growth is in concierge care anyway already. Remember, a doctor is also an entrepreneur who will probably want his/her own building if they are at all public facing and hire billing staff. I can't speak for doctors at big hospitals, mainly like surgeons and such. I imagine it's just hidden.
There probably should be insurance pools which have access[1] to the Fed window to bury chronic care spending. This is a bit sleight of hand but It's probably more efficient; it avoids all the Medicare slushing. After all, once the Boomer pig moves thru the python it'll be different.
[1] thru however many levels of indirection.
In the end, every doctors office seems to have a multiple greater than two of billing professionals to doctors. The software used for medical billing is known to be atrocious , very expensive and has the aroma of monopoly. Fix that first. Get rid of the transaction friction and we'll see.
Of course it being software, it's fundamentally subject to that organizational/"rice bowl" horror.
"That is a huge tax hike, but it would bring us only about halfway toward the level of taxation that prevails in the United Kingdom."
I don't know how this 14% difference was determined but I suspect it was an apples to oranges accounting. For the extra 14%, more UK citizens get more of their healthcare costs covered. On the US side, we fund many of our social programs through tax reductions. We give money back for mortgage interest, charitable deductions, EITC, and many other benefits. This is accounted for as lower taxes. If we gave those back as separate programs like is done for Medicaid, section 8, Medicare, SS, food stamps, etc., our effective tax rates would look a lot higher.
Your idea of “tax expenditures” (even though you didn’t use that specific term) as giving money back is Orwellian and offensive.
It presumes the money is the government’s in the first place!!!
Make no mistake, I would be very much in favor of a simpler tax, much flatter tax code without most of those deductions (if I were king I’d probably keep a tiny number of them), and in a perfect world have a constitutional amendment limiting income taxes to a certain level and add in a VAT-like low consumption tax. Because it would make incentives better when taking the same amount of money out of the economy.
So you wanna eliminate those deductions and lower overall rates at the same time, I’m great with that.
And surely special interest narrow-tax breaks are mostly crony capitalism, are indeed indefensible and some of those could reasonably enough be argued as “spending”
But regardless of what I’d do or what the ideal system might be, it is just not the case that *broad-based* deductions like almost all the ones you mention (EITC a partial exception because it is literally an expenditure where people who don’t earn enough get money from the government) are “giving money back”.
Because it wasn’t the government’s money in the first place! Those deductions are why the “main” tax rates are higher than they need to be to raise the same level of revenue to fund government, sure. But they are not expenditures. They are not spending like Medicare is.
Despite what leftists and some centrists try to claim.
The amount of money taken from taxpayers is the amount of money taken from taxpayers. Taking more harms the economy. Taking it in dumber ways surely harms the economy more, but that is a distinct point, and doesn’t make those deductions “spending”!
I gave no opinion on what should be. My comment solely focused on what is. It correctly states what is done. We have implemented spending programs through tax deductions and credits.
“It correctly states what is done. We have implemented spending programs through tax deductions…”
No sir, other than (partially) EITC, your statement is untrue. The rest of the tax deductions you cite are NOT “spending programs.”
Words mean things.
Untaxed income is NOT *spending* by the government.
NOT taking money from people at the point of a gun (the monopoly violence power of government) is NOT a “spending program”, whether you claim that it is or not.
“We give money back for mortgage interest, charitable deductions…” - your exact words - falsely implies the Marxist worldview that all income is the government’s in the first place to do with as it pleases, and it is merely government benevolence - and “spending”! - when it allows you to keep some of your money.
Freedom from additional income confiscation is NOT equivalent to a government handout. The claim that it is - which is exactly what calling broad-based tax deductions “spending” is - is Orwellian and/or economically illiterate.
Because as a refundable credit, it even goes to people who didn’t pay taxes, or paid less in taxes than the value of the credit.
So at least in some cases EITC *is* actually money going from other taxpayers to the recipient. And thus an expenditure, i.e. government spending.
DEDUCTIONS are by definition merely reductions in the amount of money for calculating how much a taxpayer owes and must pay TO the government.
Hope that’s clear now.
[Not relevant, but I do support the EITC in practice as good public policy, even if it’s imperfect. And I have zero problem with it being refundable and so in some cases actual government spending.]
A friend of mine served in Vietnam. Army. He became an airline pilot. Never needed the VA. Finally towards the end of his life, someone was telling him about how he could save money and get hearing aids at the VA or something. So he set foot in the place for the first time at age 70-odd.
They explained that he did not meet me the income requirements. As I understand it, they asked if he had been an artilleryman in which case maybe the income requirements might’ve been waived, but he had not been.
It was a kind of funny little coda to his military service.
One thing I was glad about in connection with this guy, was that Ken Burns got his Vietnam series made before he died. He was pleased with it, pleased to see his generation, get the serious history treatment.
I also see no alternative to raising the SS retirement age though it's worth mentioning that many still stay benefits at 62 so we are probably talking about reducing benefits for those in the most need more than for those who are not, though that dep nds on how the age increase is implemented. And we should also be aware that if a basic income becomes reality, the need for SS changes significantly.
Given the number of people over 65 (or younger) who have early onset age-related maladies, I'm less certain raising the Medicare age makes sense. I suppose these people also without employer plans could pick up obamacare or possibly Medicaid in some situations but that leaves the questions of both adequacy and overall savings.
We are probably going to move to concierge doctors within the next year or two just because of recurring bad experiences with nonsensical insurance denials for routine things. We have had kid 1 denied for basic checkups on the same day and from the same provider as kid 2 and other similar things.
The insurance system has really eaten away the professional independence of doctors. They have to put every decision up to a quasi-governmental tribunal for approval, and this is badly distortive. I also get the sense that the paid insurance system is run as some kind of weird embezzlement operation to fund the much larger welfare system that supports people going to the doctor every day like it's their job, not even considering the actual fraud-fraud.
You hinted at one problem most people don't think about -- insurance is meant to smooth out the cost of unexpected expensive incidents. "Basic checkups" are a prime example. Insurance adds overhead and makes those "basic checkups" more or less twice as expensive than if they were paid for by the patient directly. Covering those with medical insurance is the equivalent of covering oil changes with auto insurance, or mowing the lawn with house insurance.
I agree - there seem to be no constraints whatever for my elderly Medicared and insured (and concierged) parents. Which is interesting because it is not that they are not suggestible. They will compliantly do anything mentioned in their presence, as far as treatment or yet another specialist in their rotation of doctors. They will buy anything mentioned and carefully note it in their log for taxes (at least until recently, I think they might have run out of the bandwidth for that). If told "blood booster" they will buy 12 bottles at once. (They happily see the PT that is sent to their home, though they never do the suggested exercises; never see any improvement, though he sometimes has ideas for more things to buy; they just enjoy chatting with him, and as happily paid for him to come and roll an electric wand over my father's back, out of pocket, after it wasn't "free" anymore. They celebrated their contribution to that guy's new Tesla.) They will unquestioningly make their lives worse in many ways by rising at 4:30 AM to arduously get ready to be at a doctor's office at 6 or seven.
But the one thing no single provider, not even the concierge, has ever mentioned is: what kind of treatment and interventions do you need to be seeking at this point in your lives? How do you picture the best way to die, which is part of your life? What does quality of life mean to you? Does it make sense to go to that cancer doctor to get the shot for the prostate cancer that has shown no growth in years, while for other reasons you are down to 105 lbs. and virtually unable to digest food? (and you are confused about everything ... less easy to say, or be believed.) And your elderly wife who has broken her own health being your caregiver will have to manhandle you in to the office somehow because you can no longer stand unaided for more than a minute? How is life on a catheter that fails every week or so, and gives you a constant infection?
I don't say that they would answer these questions very rationally, given their makeup, and their generation - but I think it strange that the subject is never broached. Not paying any attention to medical stuff myself, I yet thought that there was such a thing as geriatric medicine.
So in law practice we have these kinds of conversations with clients all the time (including how some kinds of adverse actions will harm quality of life). Even though most legal costs for business are expenses, spending money on legal fees instead of something with a positive return is unwise. Millionaires are typically careful and ration their use of legal services. If lawyers were paid like doctors there would be a strong incentive to litigate to excess.
Contrast this with how normal people eligible for Medicare treat medical professionals. All of a sudden a cashier or day laborer above a certain age can command more professionals than someone with a $100m+ net worth with no real limits other than an unlikely denial. They can go every day bossing around specialists. Same thing by the way with any indigent who qualifies for free ObamaCare. The status upgrade is more meaningful than the actual “care” provided which is likely net harmful anyway.
I just signed up for Medicare. It is my understanding that Medicare does not pay for vision coverage; you have to get that through private insurance, either Part C or Medigap, both of which you will pay for. I have vision coverage in my part C which is supposed to include eyeglasses, though I have not tried to use it yet.
I agree, we *should* have started raising the minimum age back in the '80s, long before the Boomers were anywhere near retirement. Raising it 2 months per year (for people under 50) starting in 1980 would give us a retirement age of 69 yrs 4 mos today, and 70 years by the time I would be eligible (born 1960). That would have required me to work 5 more years -- a daunting prospect. But, if I had known 40 years ago that that would be the case, I would have made different late-career choices, instead of sliding into semi-retirement early.
A priority of the progressives for decades has been to nationalize healthcare. They are succeeding, with roughly half of procedure volume paid for by the Feds the last time I checked a decade ago. The tax advantage of health benefits was a nice arbitrage for employees, but now the costs are too high even so. Employers would love to shed the costs and the yelling and screaming of annual enrollment by handing the problem to government. This would have the unintended benefit or freeing up the labor market a lot.
I believe the majority of physicians are now employees, not the small business owners of the past. The few private carriers price off of Medicare, and the juice is not worth the squeeze if you're sub-scale. Between practice managers embezzling from them, their lack of training in business and management in today's compliance hell, and the cash crunch of a payer deciding to exercise their right of set-off, no sane physician would go into private practice. The difference in effort of an government employee versus a corporate employee versus an owner should be obvious to this audience, reducing capacity further.
For the bottom 50% of the population, this means their doctor of the future was going to be a nurse, just as I saw in the UK in 2007 in London. Updating, it will be interesting to see how much AI takes over diagnosis, with a pharmacist (or another AI) serving as quality control on prescription (in most countries, pharmacists have much more discretion than in the US).
For the richest 20% of the population, it will be concierge medicine, with check-ups and minor stuff paid for out of pocket and true insurance for catastrophic care -- the rich will not be waiting in line with the rest of us. For the 50-80th %ile, there may be a buy-up option for a bit better access and level of service, as in Australia, where my parents pay for "top-up" private insurance.
Bottom line, rationing will take take over more and more from price (I had to wait 6 months to see a GI doc in a major metro despite great insurance) and the elderly will continue to take from their (non-existent) grandchildren until the Ponzi scheme comes to an end. I have it on my list to review the IMF's standard restructuring recipe for how the baby gets divided up when that time comes.
I don't know where you live, but here in the Houston area I have had no problem getting a primary care physician.
I can't prove that you're wrong, but I would be willing to bet a lot of money that there will never be significant cuts in nominal outlays for Social Security or Medicare, either through reduced benefits or increased ages of eligibility. I think the problem will be "solved" with a combination of inflation and tax increases (probably income tax, so mostly paid by working-age adults). I guess this could well lead to something similar to what you describe - if in 20 years the dollar has devalued by, say, 80%, but the nominal value of Medicare benefits hasn't increased, then we would basically have a two-tier healthcare system.
Incidentally, I live in Germany, which has exactly the same problem of an increasingly bad dependency ratio. A German think tank recently came up with an interesting proposal to help with this problem: An additional 10% income tax only on retirees with incomes above a certain threshhold, to be redistributed to poorer retirees. This is one of the few attempts I've seen to solve the dependency ratio problem without either (a) even more immigration or (b) even higher taxes on adults in the stage of life where one starts or raises a family. Of course, it's wildly unpopular, with 65%-31% against. Only the youngest voters (18-29) favor it by a small majority.
19 pages and no timeframe, no mention of Japan & 250% ratio, no mention of how tariffs are a tax raising some $300 billion, about 1% of GDP. To frequently mention Trump without addressing tariffs is intellectually flabby, if not cowardly.
At best a B grade paper, tho listing 5 ways of resolving a crisis was a strong point.
Tim noted this problem might not be a crisis even in the next 10 years. I claim Japan will have this debt problem before the US, and what they do will be a big influence.
While Greg is first order correct that DOGE is cutting small govt programs, a huge benefit is establishing a fight against waste, fraud, and abuse. This crucially important because, until the govt programs are running with “all” the waste cut, all politicians will be promising to cut waste, not real voter-helping benefits.
Major reform of the US healthcare system, including nationalization/ socialism, is beyond the scope of AK’s post, or Greg’s debt note, much less a comment. But stopping illegals from getting govt benefits is an important reduction in abuse, yet Dems are already screaming about people losing coverage.
It’s not a crisis until Dems call it a crisis. And, like most bigger-govt Dems, the idea of higher taxes as the easy quick, tho admittedly painful, solution is the one Greg thinks is most likely. Most MAGA folk think more taxes on college endowments is much better than VAT. The lack of comparison of econ growth rates between VAT countries and the US is another weakness.
Finally, the chainsaw process of Argentina is the model I support, to cutting govt. it’s working well for Argentina, and would work well for any OECD country, and even China, but also USA.
Plus, even moving to a two- or multi-tiered health system, won't End the debt bingeing. Only a crisis, in Japan or some OECD country, will convince politicians that they have to cut spending.
I am a surgeon and think this is inevitable.
"What I would prefer to happen is an increase in the age of eligibility for Social Security and Medicare. All along, that age should have increased along with longevity, so that we are not giving people on average more than a dozen years to live at taxpayers’ expense."
When Social Security started in 1935, the retirement age was set at 65. Life expectancy that year was less at about 61 for men and 65 for women. In other words, Social Security started with the expectation of benefiting less than half of all newborns, the half that would live to and beyond retirement age. I don't think we could get away with that standard nowadays, and don't think it's desirable either. But an age older than 67, the current full retirement age, would make sense.
Solving the Medicare (and Medicaid) problem is much more difficult. Social Security is mainly a matter of redistributing income subtracting a minor percentage for administrative costs. Medicare and Medicaid require money and real resources to meet their obligations - the supply of medical services (more doctors, PA's, nurses, et. al.), hospital beds, clinics, medical devices, and medications. Equilibrating supply of and demand for medical services will be very difficult without introducing more market influences into the picture. I suppose rationing will be the largest factor if only because it will be the most politically palatable. (Most Americans don't believe that markets are fair.)
Mankiw claims there are only 5 ways to deal with the rising debt to GDP ratio: “(1) extraordinary economic growth, (2) government default, (3) large-scale money creation, (4) substantial cuts in government spending, and (5) large tax increases.”
Each of these covers a lot of territory, so it might be worthwhile to tease out what may or may not be covered in each.
First, economic growth. This might be interpreted to include actions like the laudable efforts to put the federal government’s trillions in physical assets to higher returning uses. Auctioning off federal urban land holdings alone would raise revenues which would not be insignificant but moving the resources to more productive use would also increase the tax base. Indeed “expand the tax base” ought be considered a 6th way to deal with the rising debt. Similarly with mineral resources tied up under Antiquities Act monument designations. Repeal that godawful nightmare entirely and watch the economy grow. Unfortunately the worms in Congress were unable to wriggle off the eco-rent seeking industry hook to do the right thing this last time this option was offered.
Second government default. Perhaps the wisest option. Destroying the government’s ability to borrow ever again is the most moral, responsible legacy we could bestow upon our offspring. But it need not go that far. Reining in the interest component of the debt, by for example setting a statutory ceiling of 2% would help. Call controlling interest paid on the debt the 7th way.
Substantial cuts in government spending ought be considered as including cuts to tax expenditures. We might want to call this the 8th way. Tax expenditures are government revenue losses from tax exclusions, exemptions, deductions, credits, deferrals, and preferential tax rates. These are substantial amounts. For example, some 10% of American workers are employed by tax exempt organizations. This frivolity must be eliminated before we start talk about ripping old people off of their earned benefits. Simply repeal section 501 of the Tax Code and watch the economic distortions vanish and tax revenues grow.
Large tax increases might be supplemented with a 9th way, let’s call moderate tax increases. For example, raise $3 trillion for Social Security by eliminating the tax cap. Or a 10th way: small tax increases. “According to an analysis from the Social Security Trustees, increasing the payroll tax by 0.1 percentage point from 2026 through 2035 until it reached 13.4 percent would raise $601 billion in new revenues for Social Security over the next 10 years. The increase would shrink the program’s 75-year shortfall gap by 26 percent.”
And given that the Europeans hate us and are really not much more liberal than the Chinese and Russians and converging fast. And given that it appears that the Ukrainians hate us as well and are going t behave pretty much like the mujahideen did after we supported them in the Afghan war with Russia if they get the chance. And the new president of Mexico acts like she would like nothing better than a way with the United States, perhaps we ought to consider plunder as an option. Authorize mercenary groups and privateers to plunder our enemies so long as they pay taxes on the booty. Would probably help decrease defense arms research costs as well.
There's another way to get rid of Social Security: replace SSA accounts with indexed mutual funds. I found that if I had invested 1/4 of my FICA deductions in indexed mutual funds, a 5% withdrawal would match SSA benefits, with 3% (DJIA) and 5% (S&P 500) left over after the standard 2% yearly Fed inflation for continued growth and emergencies, and leaving an inheritable nest egg.
So add a 4% FICA payroll tax which would go into nest egg accounts. Yes, it's a 4% pay cut for everybody, but everybody got us into this mess, everybody has to get us out. Continue the FICA tax for existing benefits. All new SSA retirees get prorated per their reduced FICA deductions with the rest coming from those nest egg accounts. As existing FICA pensioners die off, the FICA tax can shrink. It would be 4% less in 7 years, and probably vanish altogether in 30 years, leaving an 11% pay raise for everybody and eliminating that huge entitlement budget item.
To prevent those nest egg retirees from blowing it in Vegas, any withdrawals more then 5% a year have to be approved by designated heirs, a couple of doctors, and some independent auditors.
You do know that your SS proposal doesn’t work because SS is a Ponzi scheme where current retiree benefits are paid by current taxes, right?
It’s a Ponzi scheme that CAN work given ever increasing GDP, but it’s still a Ponzi scheme.
Yes if you went back to the beginning (or hell, I don’t know, back to 1961) your proposal would be far superior. But it cannot be done today.
FYI, W Bush proposed something like this 20 years ago, and it got nowhere. Because the money ain’t there to make it work to deal with the transition. And 20+ years later the money problem is much greater than back then.
Here's the standard full length version of this I sometimes post:
I've posted versions of this before. I am no financial expert, and I know this is politically impossible. My purpose is to understand a "realistic" plan to convert SSA Ponzi pensions to private nest eggs. I am not saying this is perfect or possible, only that it is the best I could come up with.
The gist is that investing 1/4 of the FICA tax in private DJIA/S&P 500 indexed funds provides enough nest egg that a 5% annual withdrawal matches SSA pensions, and since the average annual return over the last 10 years is 10% (DJIA) and 13% (S&P 500), that still leaves 3%/6% capital growth over the Fed's 2% inflation target (my figures were pre-Bidenflation), and a good cushion for bad years.
* Keep the FICA tax on all workers to pay current SSA pensions. It will decrease from its current 15.3% over time as current pensioners leave the system. Everyone contributed to this mess, everyone has to pay to get out of it. Neither the Lone Ranger nor Harry Potter is coming to the rescue.
* All new SSA pensioners get reduced benefits based on the cutiiver date. The difference is made up from their new nest egg accounts. All employees keep paying FICA and get some prorated reduction in their buyout costs.
* Add a new 4% payroll tax which goes directly to individually owned DJIA/S&P 500 indexed accounts. Yes, all employees get a 4% pay cut. We all contributed to this mess, we all have to get out of it. When the 15.3% FICA tax drops 4%, the pay cut turns into an increasing raise.
* Raise the SSA minimum retirement age to 70 years. Average life expectancy is 80 years. If half of pensioners are dead in 10 years and the 15.3% FICA tax can be cut in half to 7.65%, it would drop 4% in 5 years. This is a gross simplification, but close enough for starters.
* As time goes buy, SSA pensioners die off or take a lump sum nest egg buyout. Since this is spendable and inheritable, its value can be less than the strict 10%/13% necessary to maintain their current SSA pensions.
* I *think*, as an uneducated uninformed wild ass guess, that the FICA tax would drop to 1-2% within 20-30 years, leaving only the 4% nest egg tax. That's a 10% raise for everybody. The FICA tax would only finally disappear when the last SSA pensioner dies in 50+ years, although at some point, it might be simpler to just top up the last few SSA pensioners' nest egg accounts and cut them loose.
* The new nest egg tax invests $500 billion a year into the stock market. 50 years (working age 20-70) of that will stabilize at $25 trillion. Google says current mutual fund capitalization is $56 trillion. I do not think adding $500 billion, 1%, every year would destabilize the stock markets.
* Whether the new 4% nest egg payroll tax remains mandatory is a political decision. I'd be perfectly happy to make my own decisions and risk ending up in a bunk bed charity, but do-gooders and sob sisters will latch on to every pensioner who blows it in Vegas or loses it to a con artist, and try to restore SSA. Insurance companies could play a part. Guardians who have to approve unusual withdrawals could play a part. Legally binding waivers could play a part. But those do-gooders and sob sisters will also play a part.
Please read my scheme again. It ADDS a 4% FICA tax for the new index fund nest eggs accounts while KEEPING the existing 15.3% FICA tax to pay off existing SSA pensioners. All new SSA pensioners get reduced benefits based on the switchover date, paid from the 15.3% FICA tax, with the balance made up from the new nest egg accounts.
* All current employees take a 4% pay cut because of the new 4% nest egg tax.
* Because there are no new full-strength pensioners, the 15.3% FICA tax shrinks. I think it would shrink by 4% in 7 years which eliminates the 4% pay cut, and continue shrinking, turning into an ultimate 11.3% pay raise when the last pension dies off and it finally vanishes.
The only way to get substantially better economic growth is to gut regulations. 90% at a minimum. Get rid of minimum wage laws, occupational licensing, zoning, building codes, CAFE standards and the rest of automotive mandates. None of them need to be government standards.
* Leave building codes to mortgage lenders and insurers.
* You can find automobile safety graphs, and cannot tell from the curves where federal regulations were introduced.
Nothing else will increase economic growth. It would have the nice side effect of getting people out of the mindset that Big Daddy knows best and only Big Daddy can solve society's problems, and force people to start relying on themselves and instead of pissing away so much money lobbying the government.
It would also force millions of bureaucrats, both government and private, to get honest productive jobs instead of leeching off everybody else. Nobody's life has been saved by NO STEP signs on the backs of ladders or all those California Prop 65 warning stickers.
That brings up another simple solution: loser pays court costs, all of them, everything that was spent by the other side -- lost wages, travel expenses, their own detectives -- and put a real damper on lawyers and their bullshit lawsuits which do nothing but enrich lawyers and stifle innovation. It will also make it easier for the poor with good cases to get legal aid, since their lawyers have a much better chance of getting paid.
Well, it’s not like the Centers for Medicare and Medicaid Services (CMS) program integrity programs are insufficiently lavishly funded. In 2024, the two major anti-fraud programs got $2.8 billion (from both discretionary appropriations and from the trust fund) and the HHS IG got another $555 million of which about half came from the trust fund. Part of the problem is that the program integrity activities made no secret about where their actual priorities lay. The 2024 Comprehensive Program Integrity Plan included “Advance Equity” and “Drive Innovation” as two of their 4 priorities. Funneling money to clientele groups to recycle as campaign donations is every federal agency’s top priority.
But targeting Medicare seems to be missing a rococo farrago forest of federal health programs for a tree. If you go to table 3.2, Outlays by Function and Subfunction in the Historical Tables volume of the Budget, you will see that for 2024 the outlays for subfunction 571 Medicare were $874.1 billion. And for this some 66 million people had health insurance coverage. But what did the public get for the $854.3 billion paid out in subfunction 551 “Health care services” and the outlays of $50.6 billion in subfunction 552 “Health research and training.” And throw another $138.5 billion on top in outlays for 703 “Hospital and medical care for veterans.” It is only because the invertebrates in Congress are incapable of lifting a finger that might displease an interest group that we are stuck with this completely untenable and unsustainable budgetary dystopia. It would be easy work to consolidate and simplify all of the federal health programs and even transfer operational responsibility to the states, but the money mostly benefits establishment types at the expense of the masses so corruption will rule until the whole sorry edifice implodes which no amount of Medicare cutting will do anything to prevent.
The higher aggregate levels of taxation in Europe are due to their use of value added taxes on consumption, usually at quite high levels - 25%. The US federal tax system, largely based on income tax, excessively burdens savings and investment, costing economic growth. Any politically feasible tax increase given this structure would tend to tank the economy. So what we have seen instead is debt financed deficits. I agree the most likely outcome is implicit rationing of government paid health care and devaluation of the debt through high levels of inflation, as the most politically expedient means of dealing with the problem.
Medical spending per unit population follows a nice power law. There's probably a second mode at end of life. I've seen end of life care; nobody should put up with more than a couple of weeks of that. My parents generation (Silents/Greatest) mostly followed that "couple of weeks" rule and it seemed less bad compared to the ones who didn't. I most likely will not put up with much end of life care myself.
We don't need two kinds of care. Because of "supply" latency - medical training takes a long time - differentiating the financing makes more sense. That ship has sort of sailed; growth is in concierge care anyway already. Remember, a doctor is also an entrepreneur who will probably want his/her own building if they are at all public facing and hire billing staff. I can't speak for doctors at big hospitals, mainly like surgeons and such. I imagine it's just hidden.
There probably should be insurance pools which have access[1] to the Fed window to bury chronic care spending. This is a bit sleight of hand but It's probably more efficient; it avoids all the Medicare slushing. After all, once the Boomer pig moves thru the python it'll be different.
[1] thru however many levels of indirection.
In the end, every doctors office seems to have a multiple greater than two of billing professionals to doctors. The software used for medical billing is known to be atrocious , very expensive and has the aroma of monopoly. Fix that first. Get rid of the transaction friction and we'll see.
Of course it being software, it's fundamentally subject to that organizational/"rice bowl" horror.
"That is a huge tax hike, but it would bring us only about halfway toward the level of taxation that prevails in the United Kingdom."
I don't know how this 14% difference was determined but I suspect it was an apples to oranges accounting. For the extra 14%, more UK citizens get more of their healthcare costs covered. On the US side, we fund many of our social programs through tax reductions. We give money back for mortgage interest, charitable deductions, EITC, and many other benefits. This is accounted for as lower taxes. If we gave those back as separate programs like is done for Medicaid, section 8, Medicare, SS, food stamps, etc., our effective tax rates would look a lot higher.
Your idea of “tax expenditures” (even though you didn’t use that specific term) as giving money back is Orwellian and offensive.
It presumes the money is the government’s in the first place!!!
Make no mistake, I would be very much in favor of a simpler tax, much flatter tax code without most of those deductions (if I were king I’d probably keep a tiny number of them), and in a perfect world have a constitutional amendment limiting income taxes to a certain level and add in a VAT-like low consumption tax. Because it would make incentives better when taking the same amount of money out of the economy.
So you wanna eliminate those deductions and lower overall rates at the same time, I’m great with that.
And surely special interest narrow-tax breaks are mostly crony capitalism, are indeed indefensible and some of those could reasonably enough be argued as “spending”
But regardless of what I’d do or what the ideal system might be, it is just not the case that *broad-based* deductions like almost all the ones you mention (EITC a partial exception because it is literally an expenditure where people who don’t earn enough get money from the government) are “giving money back”.
Because it wasn’t the government’s money in the first place! Those deductions are why the “main” tax rates are higher than they need to be to raise the same level of revenue to fund government, sure. But they are not expenditures. They are not spending like Medicare is.
Despite what leftists and some centrists try to claim.
The amount of money taken from taxpayers is the amount of money taken from taxpayers. Taking more harms the economy. Taking it in dumber ways surely harms the economy more, but that is a distinct point, and doesn’t make those deductions “spending”!
I gave no opinion on what should be. My comment solely focused on what is. It correctly states what is done. We have implemented spending programs through tax deductions and credits.
“It correctly states what is done. We have implemented spending programs through tax deductions…”
No sir, other than (partially) EITC, your statement is untrue. The rest of the tax deductions you cite are NOT “spending programs.”
Words mean things.
Untaxed income is NOT *spending* by the government.
NOT taking money from people at the point of a gun (the monopoly violence power of government) is NOT a “spending program”, whether you claim that it is or not.
“We give money back for mortgage interest, charitable deductions…” - your exact words - falsely implies the Marxist worldview that all income is the government’s in the first place to do with as it pleases, and it is merely government benevolence - and “spending”! - when it allows you to keep some of your money.
Freedom from additional income confiscation is NOT equivalent to a government handout. The claim that it is - which is exactly what calling broad-based tax deductions “spending” is - is Orwellian and/or economically illiterate.
Why do you think EITC is different from other credits and deductions?
Because as a refundable credit, it even goes to people who didn’t pay taxes, or paid less in taxes than the value of the credit.
So at least in some cases EITC *is* actually money going from other taxpayers to the recipient. And thus an expenditure, i.e. government spending.
DEDUCTIONS are by definition merely reductions in the amount of money for calculating how much a taxpayer owes and must pay TO the government.
Hope that’s clear now.
[Not relevant, but I do support the EITC in practice as good public policy, even if it’s imperfect. And I have zero problem with it being refundable and so in some cases actual government spending.]
That is a real difference even if a couple other tax credits are also partially refundable.
Regardless, it is a difference irrelevant to my point.
Let me try one more time. The Lifetime Learning Credit is every bit as much of an education subsidy as a subsidized federal student loan.
What would happen if the minimum retirement age were means tested?
That’s how Medicaid and the VA ration care.
A friend of mine served in Vietnam. Army. He became an airline pilot. Never needed the VA. Finally towards the end of his life, someone was telling him about how he could save money and get hearing aids at the VA or something. So he set foot in the place for the first time at age 70-odd.
They explained that he did not meet me the income requirements. As I understand it, they asked if he had been an artilleryman in which case maybe the income requirements might’ve been waived, but he had not been.
It was a kind of funny little coda to his military service.
One thing I was glad about in connection with this guy, was that Ken Burns got his Vietnam series made before he died. He was pleased with it, pleased to see his generation, get the serious history treatment.
The VA does seem to ration with a waiting list rather than by a paucity of providers.
I also see no alternative to raising the SS retirement age though it's worth mentioning that many still stay benefits at 62 so we are probably talking about reducing benefits for those in the most need more than for those who are not, though that dep nds on how the age increase is implemented. And we should also be aware that if a basic income becomes reality, the need for SS changes significantly.
Given the number of people over 65 (or younger) who have early onset age-related maladies, I'm less certain raising the Medicare age makes sense. I suppose these people also without employer plans could pick up obamacare or possibly Medicaid in some situations but that leaves the questions of both adequacy and overall savings.
We are probably going to move to concierge doctors within the next year or two just because of recurring bad experiences with nonsensical insurance denials for routine things. We have had kid 1 denied for basic checkups on the same day and from the same provider as kid 2 and other similar things.
The insurance system has really eaten away the professional independence of doctors. They have to put every decision up to a quasi-governmental tribunal for approval, and this is badly distortive. I also get the sense that the paid insurance system is run as some kind of weird embezzlement operation to fund the much larger welfare system that supports people going to the doctor every day like it's their job, not even considering the actual fraud-fraud.
You hinted at one problem most people don't think about -- insurance is meant to smooth out the cost of unexpected expensive incidents. "Basic checkups" are a prime example. Insurance adds overhead and makes those "basic checkups" more or less twice as expensive than if they were paid for by the patient directly. Covering those with medical insurance is the equivalent of covering oil changes with auto insurance, or mowing the lawn with house insurance.
I agree - there seem to be no constraints whatever for my elderly Medicared and insured (and concierged) parents. Which is interesting because it is not that they are not suggestible. They will compliantly do anything mentioned in their presence, as far as treatment or yet another specialist in their rotation of doctors. They will buy anything mentioned and carefully note it in their log for taxes (at least until recently, I think they might have run out of the bandwidth for that). If told "blood booster" they will buy 12 bottles at once. (They happily see the PT that is sent to their home, though they never do the suggested exercises; never see any improvement, though he sometimes has ideas for more things to buy; they just enjoy chatting with him, and as happily paid for him to come and roll an electric wand over my father's back, out of pocket, after it wasn't "free" anymore. They celebrated their contribution to that guy's new Tesla.) They will unquestioningly make their lives worse in many ways by rising at 4:30 AM to arduously get ready to be at a doctor's office at 6 or seven.
But the one thing no single provider, not even the concierge, has ever mentioned is: what kind of treatment and interventions do you need to be seeking at this point in your lives? How do you picture the best way to die, which is part of your life? What does quality of life mean to you? Does it make sense to go to that cancer doctor to get the shot for the prostate cancer that has shown no growth in years, while for other reasons you are down to 105 lbs. and virtually unable to digest food? (and you are confused about everything ... less easy to say, or be believed.) And your elderly wife who has broken her own health being your caregiver will have to manhandle you in to the office somehow because you can no longer stand unaided for more than a minute? How is life on a catheter that fails every week or so, and gives you a constant infection?
I don't say that they would answer these questions very rationally, given their makeup, and their generation - but I think it strange that the subject is never broached. Not paying any attention to medical stuff myself, I yet thought that there was such a thing as geriatric medicine.
So in law practice we have these kinds of conversations with clients all the time (including how some kinds of adverse actions will harm quality of life). Even though most legal costs for business are expenses, spending money on legal fees instead of something with a positive return is unwise. Millionaires are typically careful and ration their use of legal services. If lawyers were paid like doctors there would be a strong incentive to litigate to excess.
Contrast this with how normal people eligible for Medicare treat medical professionals. All of a sudden a cashier or day laborer above a certain age can command more professionals than someone with a $100m+ net worth with no real limits other than an unlikely denial. They can go every day bossing around specialists. Same thing by the way with any indigent who qualifies for free ObamaCare. The status upgrade is more meaningful than the actual “care” provided which is likely net harmful anyway.