Politico November 25, 2019
When the massive new health program known as Medicare was created in 1965, President Lyndon Johnson got health care providers on board by buying their support: He promised that the government would let them decide how much to charge and which services to deliver. In many countries with single-payer health systems, governments decide how much they will pay; when adopting Medicare, the U.S. let providers make that decision. It gave doctors and hospitals the keys to the U.S. Treasury and guaranteed their profits.
Spending went through the roof as “ unrestricted cost reimbursement became the modus operandi for financing American medical care.” The costs wildly exceeded the government’s expectations at the time: A 1967 estimate by the House...
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