Medicare Should, but Cannot, Consider Cost: Legal Impediments to a Sound Policy (original) (raw)
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Medicare in 2030 Irretrievably Broken
Journal of Medical Research and Surgery, 2022
The Medicare Program is the second-largest insurance program in the United States, with approximately 64 million beneficiaries and total expenditures of over $839 billion in 2021 [1]. There are two separate trust funds in the Medicare Program, namely the Hospital Insurance Trust Fund (HI Trust Fund) and the Supplementary Medical Insurance Trust Fund (SMI Trust Fund); both trust funds are held by the U.S. Treasury [2]. The first trust fund covers hospital in-patient expenses; and the second trust fund covers medically necessary services by medical doctors and doctors of osteopathy, preventive services, brand-name prescription drugs, and generic drug coverage [3,4]. Prior to the COVID-19 pandemic, the latest financial calculations projected that the HI Trust Fund would be insolvent by the year 2026. It is a fact that the Medicare HI Trust Fund has never been insolvent because there are no provisions in the Social Security Act that govern what would happen if insolvency were to occur. Ten of the last twelve years have witnessed expenditure outflows outpacing the HI Trust inflows, resulting in total Medicare spending obligations outpacing the increasing demands on the Federal budget as the number of beneficiaries and the per capita healthcare costs increase each year [5]. Uncompensated care refers to uninsured patients who receive care upon hospital emergency room admissions but not ever paying the hospital bill after discharge or death. Uncompensated care is the kryptonite of hospital financing because it is unpredictable and can easily destabilize the monies that hospitals depend on to cover overhead expenses. Nationwide, hospitals protect themselves against the uncertainty of uncompensated care by drastically overcharging prices to different patients receiving the same or similar medical procedures at the very same hospital locations. For all intents and purposes, the creation of Obamacare failed to address this kryptonite. However, it is a fact that the legal system places limitations upon what the federal government can do to deal with this Achilles’ heel of the American healthcare system. State governments truly hold the power to effect change towards the future of healthcare in 2030, both private healthcare and government-sponsored healthcare. Since 1970, one state has proactively protected its statewide healthcare system against the dangers of uncompensated care: Maryland. It is the only state in the entire nation to receive a federal waiver from the U.S. Centers for Medicare & Medicaid Services (CMS) because their specific design for accounting for a plethora of poor patients. This effort started with a group of hospital administrators meeting for coffee on a consistent basis to brainstorm the solution from their collective hospitals. Driven by the pride to help their communities, their involvement with the Maryland government led to the creation of the Maryland Health Services Cost Review Commission (Maryland HSCRC). This impartial government institution is backed by Maryland law that gives it the necessary legal powers to set stated singular hospital prices for all services statewide; these prices include the adjustments for uncompensated medical care that is distributed among all stakeholders equally.
Medicare: Intentions, Effects, and Politics
Journal of Health Politics, Policy and Law, 2001
To rephrase a lyric by the Grateful Dead, what a short, strange trip it's been. Just six years ago the combination of the apparent immediate fiscal crisis in the trust fund for Part A of Medicare, anticipation of the Baby Boom's approaching retirement, and the largely unexpected arrival of active, conservative Republican majorities in Congress shot fundamental restructuring of Medicare to the top of the nation's political and legislative agendas. That theme carried through the often contentious work of the National Bipartisan Commission on the Future of Medicare, which in 1999 fell just one vote short of the supermajority required to recommend formally shifting from providing a package of defined benefits to giving checks to beneficiaries ("premium support") toward purchase of their choice of a qualified private health insurance plan in competition with "traditional Medicare." Many pages of this journal and others, as well as various special edited books, were devoted to assessments of the relative merits of different market-based models for Medicare. However, thanks to a continuing robust economy, the resulting welcome surge in revenues, and the surprisingly effective financial restraints imposed on Medicare provider payments by the bipartisan Balanced Budget Act of 1997, what looked like looming deficits for the health insurance trust fund starting as soon as next year has been pushed back more than two decades, according to the most recent report of the Medicare trustees (Board of Trustees 2000).