Thursday, November 5, 2009

Further Thoughts on Medicare

From way back when, I proposed a "medicare for all" type program for health care reform. Many people have said that medicare spends too much money and the government-run agency is in the red.  How could I possibly advocate adding to the deficit and rewarding the bureacracy and high costs that medicare pays for services?  I often reply that private insurance costs and profits total about 30% and that medicare with all it's administrative costs total about 6-7%.

I read an article today entitled Congress often blocks Medicare changes that would cut costs McClatchy:
In it, they point out that it is often congress and the health care industry itself that seems to be averse to any money-saving ideas.
"Consider the case of a 1990s pilot project that earned the support of a president, several key legislators and successive Medicare leaders from BOTH PARTIES. A five-year test showed that lumping together payments for doctors and hospitals for some heart surgeries encouraged them to be more efficient and reduced Medicare's cost by 10 percent. The project ran into relentless opposition from doctors and hospitals, however. The result: Congress has never approved the change for widespread Medicare use, and Medicare continues to study the issue."

Medicare has conducted hundreds of tests, called pilots or demonstration projects, since the mid-1970s, but it can't apply them to the entire system without congressional approval. Lawmakers have made other important changes to Medicare, but pilot projects rarely have been the catalyst.

Still, in the overhaul legislation that's working its way through Congress, lawmakers have added provisions that they hope can improve the odds for implementing successful demonstrations. One measure seeks to circumvent the difficulties of getting congressional approval for changes. It would give the secretary of health and human services the authority to expand demonstrations that work; Congress' permission wouldn't be needed.

Another would create an "innovation center" that would allow Medicare to pursue promising ideas more quickly. Yet another would set up an independent commission to recommend savings that would be implemented if Congress didn't act.

In 1997, Congress instructed Medicare to test a plan under which suppliers of durable medical equipment — oxygen tanks, diabetes supplies and wheelchairs — would submit bids. Medicare would use the bids to generate a range of prices that it would pay and would require suppliers who wished to sell to its patients to meet those prices. After the demonstration showed a 20 percent savings, legislators in 2003 ordered Medicare officials to expand the program.

However, by 2008, medical supply companies, worried that they'd lose money, pressured lawmakers to reconsider details of the program. Congress came to share the suppliers' view that the bidding process was unfair to smaller companies and delayed the project until 2011.
Why wouldn't it make sense for companies that supply durable goods to which medicare often overpays, to bid on the process to lower our costs?  Why did President Bush refuse to allow us to negotiate with drug companies participating in the huge expansion of medicare part D that he signed?  Why would he not allow cheaper drugs from Canada to be imported?

These are all questions that must be asked.  The President, Congress, and medical service suppliers must be part of the solution, not the problem.  Please don't say "That will never happen."  I say, if a politician isn't on board, vote him out, Democrat or Republican.  If the medical suppliers won't negotiate, don't negotiate with them.

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