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The Medicare health maintenance organization program is a mixture of public and private health plans. This book explains why the current pricing system has increased the inefficiency of the Medicare program and presents a detailed proposal for reform through the use of a competitive-pricing system. According to its supporters, Medicare is one of the most popular social programs in U.S. history. Politicians are regularly warned, and appear to believe, that tampering with any part of the program that affects beneficiaries directly can be damaging to their professional health. Some of the program's popularity, however, stems from two misconceptions. First, many believe it is like an account where money is placed until it is needed. It is not. Second, many believe that current retirees have paid for their benefits. They have not. On the contrary, they receive a large subsidy from current workers. For these and other reasons, behind the veneer of popularity and political clout lies a program in serious trouble.

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Bryan E. Dowd

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Roger Feldman

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