Medicare more expensive when privatized?

[Victor Danilchenko]

Yesterday on PBS there was a NewsHour segment about Medicare. An interesting thign I heard there is that apparently the partial privatization of medicare that had happened prior to the current bill, has shown some very surprising (to some) result: apparently private medicare administration (Medicare+Choice) ends up less efficient that the government administration. The way it was explained was that the private companies have either to cut costs or to negotiate better drug prices with manufacturers in order to eke out a profit margin -- and that they proved unable to do either, so instead they reduce the services offered to seniors under medicare+choice.

Does anyone know more about this?

 

[specious_reasons]

I wish I knew more, too. I had heard this on NPR (All Things Considered) last night.

The one possibility that I thought of: The private health care insurers still need to cope with government bureaucracy, so they may be more encumbered under the Medicare+Choice plan then when running their own independent insurance.

So, it might not be that private health care is less efficient than governmental health care, it's just that government can provide governmental health care more efficiently.