Argument: Public insurance will be used excessively at greater cost
Walton J. Francis. "Why a new public plan will not improve American health care". Heritage Foundation. May 5, 2009: "Excess Use. Then there is the matter of managing patient care to improve outcomes and reduce costs. Medicare spends zero on this function. Private plans spend around 5 percent in administrative costs to manage care (second surgical opinions, pre-certification for hospital stays, and the review of preferred provider outcomes, etc.) and often save around 10 percent in reduced use of health care ser vices. Medicare's administrative costs look better arithmetically because the denominator is higher and the numerator is lower, but the advantage is again entirely illusory—$100 in frugal care costs the private plan $16 (the previous $11 plus $5), while Medicare is spending $120 and wasting $20—$10 on fraud and $10 on overuse in addition to the $5 it spends on bill paying. Again, the worse the actual performance, the better Medicare's administrative costs appear as a percentage of total spending."