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Sunday, April 29, 2012

Why We Don't Want To Get Rid of Medicare-Our Best Tool for Health Care Reform


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

8 comments:

dennis byron said...

This article often uses the word Medicare when it is referring to Medicaid.

It also says "Parallels are drawn between the Medicaid changes and what may happen to Medicare if it is schlepped to the states."

What proposal is suggesting that Medicare by turned over to the states? None that I have ever heard of.

healthpolicymaven said...

Thanks for reading the article. I have used both the Medicare and Medicaid terms specifically. CMS administers both programs and the block granting that occurred under the Bush Administration transferred much more financial burden to the states for Medicaid. The idea that is being discussed by some people to reform Medicare is simply to have a fixed budget allocation per capita, which is basically a block grant.Because there are dual eligible Medicare/Medicaid constituents this would at a very minimum have a financial impact on the states. Further, the block grant or capitation budget approach does not address any of the other reforms needed to bring Medicare and national health care costs down, which is also the reason I wrote the two-part article. My apologies if it wasn't clear enough for you.
Thank you for taking the time to comment.

Anonymous said...

The most frequent concern I hear among seniors when dicussing Medicare is whether they will be able to see their primary care doctor or in fact any primary care doctor. The lack of quick access to primary care (an appointment in a day or two and not a week or two) as well as affordability are vital. These things come by looking at the new and better ways to deliver primary care as well as the government (CMS) and private sector realizing that PCP's are the most effective dollar spent in healthcare. If Medicare and Medic aid reimbursements are stripped here then we will all be in trouble. Maybe not right away but eventually as PCP's leave the field. we cannot afford to fall into the trap of thinking that Medicare rule and funding changes impact only the elderly and poor. eventually we are all affected by Medicare rules about care, cost, funding and delivery models.

healthpolicymaven said...

Certainly the Medicare reimbursement model needs to change. Because of the scope of Medicare and its impact on the entire country's health care it is the best place to figure out how to build a better patient care model, including paying the clinicians for their work. Presently our health care system pays for transactions, not health, and this needs to change. The Accountable Care model attempts to look at this paradigm to align Medicare/Medicaid payments for better health care outcomes.
Thanks for taking the time to read and comment on my article. I know it wasn't the leanest one I've written.

Anonymous said...

Medicaid will never be eliminated and to me that is what is making our country lose money. Why should we pay for the birth of babies we never had something to do with their breeding.

Anonymous said...

Medicare we paid to have and Medicaid is a gift for consequences of poor people.

healthpolicymaven said...

It is interesting that one reader has commented on the poor in America opting not to have children, yet much of the country has devoted itself to prevent poor women from having access to basic birth control. The furvor over the health care reforms is in large part because of the equalization of female reproductive rights regardless of their economic status. This seems to be a solution that you would support.
And I do agree that poverty is not a crime and those who are poor should not be treated as criminals.

Abdul Basit said...

By the way you are right ? why we wouldn't this ? its really helpfully for Scoliosis treatment .