Tag Archives: Medicare (United States)

Is Medicare Going Bankrupt?

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Yesterday The New York Post posted an article about the financial condition of Medicare. It seems that Medicare is really doing rather well.

The article cites some interesting statistics:

As the new Congress convenes, budget cutters are eyeing Medicare, citing forecasts the program for seniors is running out of money. But federal bean counters have erroneously predicted Medicare’s bankruptcy for decades. One reason: They don’t consider medical breakthroughs.

Another problem is medical ethicists like Dr. Ezekiel Emanuel, who insist the elderly are a burden and that resources would be better spent on the young.

The facts prove otherwise. New medical findings give plenty of reason for optimism about the cost of caring for the elderly. According to data published in the journal JAMA Internal Medicine, Medicare spending on end-of-life care is dropping rapidly, down from 19 percent to 13 percent of the Medicare budget since 2000. Living to a ripe old age shouldn’t be treated like it’s a problem. It’s a bargain. Someone who lives to 97 consumes only about half as much end-of-life care as someone who dies at 68.

Dr. Emanuel has some unique ideas about aging, which are stated in the article:

Why would we emulate Zeke Emanuel, age 59, who swears that at 75, he will forego all medical care and let death come quickly? “Our older years are not of high quality,” he insists. He’ll skip them. In The Atlantic magazine, he dismissed compression of morbidity as “quintessentially American” wishful thinking, and mocked seniors for trying to “cheat death.”

Keep in mind that Dr. Emanuel was one of the people behind ObamaCare who espoused the idea of limiting medical care for older Americans. That is one of the reasons it was so surprising that the AARP supported Medicare. They betrayed their own members.

The article concludes:

Too often, Congress treats Medicare as a piggy bank — raiding it when money is needed elsewhere. In 2010, Democrats in Congress paid for over half of ObamaCare’s spending by cutting Medicare. This year, Republican lawmakers eager to control federal health spending should avoid that error and instead focus on fixing Medicaid, the money pit program for the poor, where spending per capita is growing twice as fast as for Medicare. (I added the italics to this quote.)

Medicaid spending now tops $8,000 per recipient. That’s thousands more than is spent on people in private plans. And for all that money, studies show Medicaid isn’t improving patients’ health.

By contrast, Medicare is a success story. It has transformed aging, enabling older Americans to lead longer, more independent lives than our grandparents did. The average man turning 65 today will live five years longer than in 1970. Not just more years. Quality years. What a gift.

Medicare is partially paid for by payroll deductions from both the employee and the employer totaling about 2.9 percent, so Medicare is at least partially paid for. Medicaid is a gaping hole in our pockets that does not guarantee quality care to anyone. Healthcare in America is a problem that ObamaCare has made worse. Hopefully Congress and President Trump can come up with something that provides care for everyone who needs it, but also allows free market competition to keep the costs down for everyone.

A Really Bad Idea–Both Politically and Practically

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Yesterday, Bloomberg,com reported that New Jersey Governor Chris Christie has released his plan to reform Social Security.

The article reports:

Christie, the 52-year-old Republican governor of New Jersey, called for phasing out retirement payments to those with more than $200,000 a year in other income and smaller reductions for those earning $80,000. Together, he said, the overhaul would save $1 trillion over a decade.

“It is about telling all Americans the truth — and without delay,” he said during a 40-minute speech at St. Anselm College in Manchester. “If you believe we should keep this promise, as I do, that all Americans should have access to the economic security these programs provide, then that costs money.”

Spelling out his plans in detail for the first time, Christie proposed:

— Raising the retirement age for Social Security to 69 from 67, for those born in 1960 or later;

— Raising the age to qualify for Medicare by one month per year until it reaches 67 from the current 65.

— Eliminating payroll taxes for seniors who remain in the workforce.

I have some major problems with this idea. Social Security is deducted from almost everyone’s paycheck from the time they begin work. Federal employees, active duty military (and Congress) are exempt. The money was supposed to be put in a lock box where it could accrue interest and grow to meet the increasing need. In 1965 (or so) that lock box disappeared and the money was used to fund the war in Vietnam and the Great Society programs. Since then it has been used to fund welfare and entitlement programs. Generally speaking, these entitlement programs do not have a work requirement and the people collecting the money do not have to do anything to earn the money they receive. In most states welfare recipients are not drug tested (most working people have to pass a drug test in order to get a job). Social Security is not the place to cut the federal budget–the people collecting it have paid money into it–it is not their fault the government chose to spend the money.

Recently my husband and I took a vacation to Iceland and Wales. In Wales I learned something about giving to people who may be in need. My husband and I volunteered in a restaurant run by a church. In America, it would be similar to a soup kitchen. However, there was something about the restaurant (which served dinner once a week) that impressed me. The meals were not free. There was a small charge for dinner and a somewhat limited menu to choose from. If someone came in who could not pay, they were given a free meal, but generally speaking, a diner paid something for his dinner. Somewhere along the line, we have taught a group of Americans that there is a free lunch. It is time for that to end. We are accomplishing nothing by denying benefits to those who have paid for them and giving benefits to those who are contributing nothing. That is the wrong message to send.

As an afterthought–does anyone really believe that once an income limit is set on receiving Social Security there will be no changes to that limit? Governor Christie’s plan has the potential of turning Social Security into a plan that everyone who works pays into but is only available to those making less than $50,000 a year in retirement. His plan will create another entitlement that everyone who is working pays into and everyone who is not working can collect from.

The New Medicare Doc Fix Bill Will Hurt Those It Is Supposed To Serve

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The Daily Caller posted an article today about the “Medicare Access and CHIP Reauthorization Act” (MACR). The bill bears a striking resemblance to the Independent Payment Advisory Board (IPAB), a part of ObamaCare designed to cut Medicare costs.

The article explains:

The new payment system MACR creates for Medicare is eerily similar to the IPAB model. Dubbed the Merit-Based Incentive Payment System (MIPS), it will reward or penalize physicians who treat Medicare patients based on various metrics. Two of the metrics that MIPS will use to grade physicians are how well physicians’ patients score on quality measures and how many medical resources physicians use to treat patients. Under MIPS, a physician will receive a composite score, between zero and 100, based on how well he meets the MIPS criteria. Each year, the Centers for Medicare and Medicaid Services (CMS) will choose a “threshold” number. If a physician minimizes the use of medical resources while his patients score well on quality measures, he will likely score above that threshold and he will receive a bonus. If he scores below it, he will be penalized with a cut to his Medicare reimbursement.

The intent behind MIPS is consistent with the IPAB mission of lowering Medicare’s cost growth and improving quality. The quality measures and resource use components of MIPS are supposed to promote those goals by rewarding physicians who provide quality care at a lower cost.

Under the new rules, doctors will be encouraged to use the majority of their resources on patients who are moderately ill. To treat too many seriously sick patients will lower a doctor’s “threshold” number and cut his Medicare reimbursement.

The article concludes:

One of the goals of MACR, eliminating the unworkable Sustainable Growth Rate, is a worthy one. Getting rid of this perennial problem, however, should not come by way of a new payment system that will make it harder for sicker patients to obtain physician care. The Senate should remove MIPS. Otherwise, lawmakers risk installing an IPAB-style payment system in Medicare.

Very few people will argue that we need to cut the cost of medical care in America. However, I don’t believe most Americans want to do it at the expense of our chronically ill or aging citizens. This is not the way to cut medical expenses. A free-market system with less government intervention would be much more efficient and have the effect of cutting expenses for everyone.