Why Is Medicare Saving Paying for Teslas?

The Inflation Reduction Act marked the first time climate change took priority over medical care in American health policy.

Initially heralded as a “sweeping health care and climate bill,” the law is now projected to spend more than a trillion dollars on green energy but only a fraction of that improving Medicare.

Worse, much of the $280 billion in savings from its Medicare prescription drug provisions were siphoned off to fund green policies such as $7,500 electric-vehicle tax credits. Medicare will keep only about 15% of the savings for some relatively inexpensive new benefits, such as a $2,000 annual cap on pharmacy spending. That’s unfortunate considering the program’s costs are projected to spiral from about $1 trillion this year to $1.8 trillion in 2031.

Some quip that Medicare enrollees would have to buy a Tesla to see the law’s prescription-drug savings. Few could afford such a luxury. In 2019 half of enrollees earned less than $30,000 a year, and AARP reports that the average senior pays $6,500 a year in out-of-pocket health costs. A typical Tesla buyer is half their age and makes about $150,000 a year. Questions of social equity abound.

So how did we get to the point where Medicare is financing electric cars? It started with a campaign to reposition climate change as a health priority, not just an environmental one. This has some merit, but the two issues’ conflation has led to confusion and competition for limited healthcare funds.

Almost a decade before the passage of Inflation Reduction Act, Time ran a piece titled “Rebranding Climate Change as a Public Health Issue.” Communication experts recommended presenting climate change in a public-health frame after noticing test groups responded better to that messaging than dire warnings about melting ice caps and endangered species.

As Time put it: “What if climate change were instead about an increase in childhood asthma, or a surge in infectious diseases, or even an influx of heat-induced heart attacks? Would that hold more resonance for the average citizen of the world? That’s what some climate change experts are hoping.”

For years, this new approach worked brilliantly, attracting billions in new funding for climate projects around the globe. Then it hit a wall during Covid-19. Climate-change initiatives and financial pledges stagnated as governments restricted resources to traditional health priorities such as medical care.

More than 200 medical journals and groups like the World Health Organization fought back in 2021, boldly declaring climate change “the greatest threat to global public health” even though millions were still dying from Covid-19.

The statement continued: “Many governments met the threat of the Covid-19 pandemic with unprecedented funding. The environmental crisis demands a similar emergency response. Huge investment will be needed.”

Fortunately for them, American lawmakers were listening. Within a year, Congress passed the Inflation Reduction Act to near universal plaudits from America’s health leaders. There may be less enthusiasm if Medicare has to raise premiums or cut benefits down the road.

Mr. Merritt is president of Proactive Strategies Group and has served as a senior executive in several healthcare industry groups.