Means testing by any other name

Hardly anyone wants to endorse means-testing but almost everyone is for it.  Of course Medicaid, food stamps, HUD housing assistance, and many other programs are already means-tested. 

Furthermore most people want to extend the scope of the principle.

A few days ago Greg Mankiw described means testing (negatively) as "an income tax surcharge on old, sick people."  But last year Greg seemed to endorse a proposal for means-tested subsidies for the purchase of health insurance, involving a corresponding limitation on the tax break for the relatively wealthy.   

Paul Krugman writes:

If we’re serious about controlling Medicare costs, Peter Orszag and his staff at CBO have had a lot to say about this. Means-testing isn’t the answer; setting priorities for care is.

Of course the big health care priorities — most of all in Krugman’s eyes — involve greater access for poor people.  The prioritization process, if it is to save money, will in some way discriminate against higher-income users, even if the changes are not labeled as such.  The people with "too many doctor visits" or "too much wasteful use of capital equipment" are not in general the poor.

The real question is means-testing at which margin and in which manner.  In the meantime, beware of arguments which insist that means-testing is good or bad per se.


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