Perry, Cain, and Medicare: a 2011 View of a 1966 Prediction


Most political candidates stick to bland platitudes on Medicare, but two are under liberal attack for telling the truth about our doomed entitlement programs.

Governor Rick Perry has been accused of thinking that Medicare is unconstitutional. He told Andrew Romano in a 2010 Newsweek interview that Social Security is a Ponzi scheme, and that we needed to talk about the $106 trillion in unfunded liabilities of Medicare and Medicaid (Title 18 and Title 19 of Social Security, respectively). When confronted about statements on Social Security in his book Fed Up!, he made conflicting statements, and his website evades the “third rail of American politics” altogether.

In 2006, Herman Cain wrote that “the Social Security scam keeps on ticking.” He cited the 1960 U.S. Supreme Court case of Flemming v. Nestor, which held that Americans have no right to receive Social Security benefits, even if they paid into the system. Democrats do not want to face up to the financial crisis because “they duped the public 70 years ago.” On his website, Cain writes: “Too many people have exchanged their freedom for a false sense of security that these programs are supposed to provide.”

Warnings about these programs may be newsworthy coming from politicians, but they are hardly new. A 1966 letter to 1,900 Mississippi physicians by Curtis W. Caine, M.D., a past president and current director of the Association of American Physicians and Surgeons (AAPS), has just been republished on The daily news in 2011 makes him look like a prophet.

Doctors will be “ignominiously begging HEW [the Department of Health, Education and Welfare, the predecessor to HHS] for a few more pennies per visit,” Dr. Caine wrote. Medicare payments looked tempting back then, but now we have yearly battles in Congress to delay cuts in Medicare’s fixed fees.

“While money is squandered by the bureaucrats in administering medicare, doctors participating in medicare will be required to be economical. Cheap treatments and cheap prescriptions are to be given preference. HEW employed referees will set the standards—not the patient’s doctor,” predicted Dr. Caine. Now, candidate Cain points out that Congress has raided the trust funds and stuffed them with worthless IOUs. And unless ObamaCare is repealed, we’ll have IPAB (the Independent Payment Advisory Board) as the referee turned czar.

“Medicare, though it is called such, is not insurance. There is no contract. There is no policy wherein the provisions are stated. It is whatever the Secretary…may direct,” observed Dr. Caine. So did the Supreme Court, in the decision now referenced by candidate Cain. From ObamaCare, the Secretary of HHS gets enormous additional power.

“Under medicare, the good doctor will be equalized with the mediocre doctor. There will be less incentive to be the best doctor possible.” Doctors may have scoffed at Dr. Caine’s prediction in 1966, but under Medicare’s price controls, all “providers,” including the least qualified ones, get paid the same for the same procedure code. More and more Medicare patients are unable to find a physician to treat them, and have access only to “mid-level providers.”

Making citizens dependent on the federal government for pensions and medical insurance is clearly not among the enumerated powers of Congress in the U.S. Constitution. Candidate Perry is right about that. No one, however, proposes abandoning those who were forced to pay into the system and now must rely on it.

It’s past time for politicians to stop running from the truth that was obvious to a Mississippi doctor in 1966. A good starting point, which Republicans including Perry and Cain generally say they favor, is to repeal the latest expanded entitlement, ObamaCare.

They would also do well to quote Dr. Caine’s conclusion: “For the American miracle to continue we must have less government and more individual responsibility.”