Why
We Don’t Want To Get Rid of Medicare-Our Best Tool for Health Care Reform
The pressure is on for federal budget
slashing and of course social programs (not defense) are top-of-the-list for
cost reductions, including the malignant call for block granting the Medicare
program. Having previously analyzed the Bush Administration’s Deficit Reduction
Act of 2005, including the odious federal government, “claw back provision” for
reducing federal contributions for state Medicaid programs, this article
reviews some potential impacts of a block grant or per capita allowance for
Medicare participants. Parallels are drawn between the Medicaid changes and
what may happen to Medicare if it is schlepped to the states. Finally,
Medicare’s impact on overall health care policy making in the United States is
analyzed.
Would
Block Granting Medicare Look like the Medicaid 1115 Waiver Plans?
As of 2005, half the states already had
approved Medicaid 1115 plans including: Alabama, Arizona, Arkansas, California,
Colorado, The District of Columbia, Florida, Georgia, Idaho, Illinois, Maine, Massachusetts,
Michigan, Missouri, New Jersey, New Mexico, New York, Oregon, Puerto Rico,
South Carolina, Tennessee, Texas, Utah, and Washington. Oregon is famous for
its health care plan which assesses a clinical and cost/benefit value for
treatments covered by its subsidized public health care program. Most of the
other states with Medicare 1115 Plans have eliminated benefits under the
programs or drastically cut enrollment for poor residents. By example, Missouri
eliminated 500,000 people from its Medicaid program. Many of the states with
Section 1115 waivers used the provision to charge co-payments and premiums to
certain Medicaid eligible constituents.
Impact
on Drug Costs-Zip
In addition to cutting back on benefits,
one of the trends for state implementation of Medicaid 1115 Waiver Programs is
to pass more of the prescription drug costs to their plan participants. This
does nothing to contain costs and merely makes low-income people pay more for
their medicines. Medicare is also doing this with its drug program, by allowing
pharmaceutical companies to charge retail market prices (the highest-in-the-world)
for drugs while offering “discounts” to Medicare participants. It doesn’t take a
rocket scientist to figure out that the pharmaceutical companies just raise
their prices to include the “discounts” to the Medicare set.
Side
effects of Medicaid 1115 Waiver Programs
Deferring
Health Care
One of the provisions that Medicaid 1115
Opt-Out Plans can make, is to transfer more plan costs to the poor who are
enrolled on these plans, however, that may mean people avoid medical care.
This is a conundrum, though Medicaid enrollees have health insurance, they may
not have enough money to contribute to the co-payment requirement. The Journal
of Health Affairs published an analysis of the Utah State Medicaid program
which showed that cost sharing up to 10% did have a negative impact on the
indigent patient’s ability to obtain health care (AKA they deferred treatment).[1].
Clinician
Access
Patients enrolled on Medicaid plans have
insurance, but may not have a primary care clinician who will see them. Merely having
insurance does not mean there are clinicians willing to accept those
patients. Medicaid has notoriously been
viewed as paying poorly for medical services, although some states have taken
steps to alleviate that road block to care. This problem of access to clinical
care, especially for wellness or primary care is also rampant for Medicare participants.
If they don’t have private insurance, it is very difficult for a Medicare
patient to find a clinician who will accept them into their patient mix. This phenomenon
is reflective of the poor reimbursement CMS provides for its primary care
clinicians.
Another one of the methods that states
have used 1115-Waiver provisions to change their Medicaid plans is to offer
private insurance coverage, but this is hardly more cost effective, since the administration
costs are three times as high as what the Centers for Medicare and Medicaid
(CMS) charge, with no cost containment. This could however increase access to
doctors who are willing to treat Medicaid patients.
Medicare
as the Policymaker for Health Care Treatment and Payment
CMS, which administers health care for
Medicare and Medicaid, is by far the largest health care program in the United
States. Administrative cost for CMS run about 6%, as opposed to 18% for the
private insurance sector. In addition to administering health care programs for
the elderly and the poor, two constituents whom the private insurance sector
has historically had little interest in insuring, CMS also finances
demonstration projects with clinics throughout the country to figure out how to
improve health care. An example of such a project is the Advanced Primary Care
Demonstration Initiative[2],
which is looking at patient-clinician engagement to improve health outcomes and
pay clinicians for coordinating well patient care. There are also similar
projects for the Accountable Care mandates, which reward clinics that produce
better clinical results than those who are more marginal. These efforts are possible
with a large enough patient population and an integrated patient tracking
system, which coincidentally, is representative of a national health care
program.
Fraud
Detection-The Government Has the Bigger Stick
Medicare is the number one detector of
fraudulent billing for health services in the country and it is essential that
this bully pulpit be preserved. In The Battle Over Health Care[3],
big pharmacy is now cited as the number one defrauder of the government and
hence the United States people, even ahead of the perennial defense industry.
Do any of us really trust the drug companies to police themselves, or for that
matter any of the medical suppliers? In a fragmented Medicare system fraud detection
would be more difficult not less.
Patient
Safety-Do You Want to Leave it up to the Private Sector?
In Rosemary Gibson’s and Janardan Prasad
Singh’s brilliant, The Battle Over Health Care, numerous frightening
examples abound of drug company, medical device supplier, and hospitals
actually harming patients. Perhaps most egregious are the methods some of these
companies (most of the abusers are for-profits) use to avoid accountability
when they harm patients. A bright spot on this tarnished map is the University
of Michigan Health Systems, which has a protocol mandating that its
clinicians/facilities which harm patients; take responsibility, offer
transparent information on what occurred, offer a settlement to the
patient/family(without litigation), apologize, and provider free ongoing health
care.[4]
It is this type of candor which would go a long way toward improving patient
safety in American health care. Imagine clinicians and hospital administrators
who fess up rather than lawyer-up.
Conclusion
Though Medicare certainly has its
detractors and is not lithe when it comes to adopting changes, it is more
economical than any private sector health insurance program, and it
covers high-risk populations like the
elderly and those with end-stage renal disease. Medicare drives policy changes
throughout the entire United States health care system by determining how it
will pay for services. This is ultimately the way the country can start to
reduce its health care costs, by negotiating with drug companies, eliminating
fraud, and equally important, unnecessary procedures. Because Medicare changes
also impact private sector insurance companies, it is an essential component of
health reforms and well as other national health care initiatives. CMS, which
administers both Medicare and Medicaid, provides the nationwide health care
partnership to test and deploy health care program changes. Through this surveillance
process we can learn what works for the disparate U.S. health care system and
attempt to lower costs and improve not only primary health care, but also
preventive care. Too much of the U.S. health care dollar is spent on late-stage
disease treatment versus patient health maintenance. If we hope to be
competitive in a world economy, we must bring the per capita cost of our health
care in line with the rest of the world and turning it over to the private
sector foxes is not the answer.
For more discussion on this health care
article, feel free to comment below. This article was written by Roberta E.
Winter, the healthpolicymaven, and may be reprinted with her permission. Feel
free however to share it voraciously with your friends and family.
Also, for those who want to read more of
The Battle Over Health Care go to the New York Journal of Books for my
review, by following this link: http://www.nyjournalofbooks.com/review/battle-over-health-care-what-obama%E2%80%99s-reform-means-america%E2%80%99s-future
Samantha Artiga, David Rosseau, Barbara Lyons, Stephen
Smith, and Daniel Gaylin, Can States Stretch the Medicaid Dollar Without
Passing the Buck? Lessons from Utah, Health Aff., March 26, 2006, vol. 25, no.
2. p. 532-540
[2] http://healthreform.gov/newsroom/factsheet/medicalhomes.html
[3]
Rosemary Gibson and Janardan Prasad Singh, The Battle Over Health Care, chapter
2, page 24
[4]
Rosemary Gibson and Janardan Prasad Singh, The Battle Over Health Care, chapter
13, page 163
