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It’s Time to Stop Demagogueing Medicare

By Harry S. Margolis

Everyone in Washington knows that the so-called “fiscal cliff” is nothing in comparison with the fiscal abyss awaiting us if we don’t reform Medicare, but they’re still playing politics with it.

According to the World Health Organization, we’re already spending more than 15 percent of our gross domestic product on health care with worse results for the population as a whole than any other industrialized nation. With millions of Baby Boomers joining the Medicare program every year, without major reforms it will bankrupt the nation.  Even before the downturn, the federal government was in deficit and the vast growth of the Medicare program has just begun.

There are many approaches proposed to rein in Medicare and health care spending in general, from market-based programs to capitated fixed payments to providers per patient. Rep. Robert Ryan has famously proposed giving each Medicare beneficiary a fixed amount to use to buy insurance. Others have proposed a combination of approaches, including:

  • Developing best practices to limit spending that does not further health.

  • Penalizing hospitals for costly and avoidable readmissions caused by insufficient after care.

  • Insurance pools, so that insurance companies will compete on price.

  • Changing payment structures so that providers will be better compensated for preventive health care and not so well paid for procedures.

  • Permitting the federal government to negotiate with pharmaceutical companies for lower prices for drugs.

  • Counseling patients and families about the true physical costs and potential effectiveness of treatments that are often tried at great expense at the end of life.

Some of these proposals have been incorporated into the Affordable Care Act (ACA) either as part of its policies or in grants to states and providers to test them out.  The ACA also includes an Independent Payment Advisory Board to monitor and reduce Medicare spending.

The House majority leader, Rep. Eric Cantor, has targeted thisRep. Eric Cantor board claiming that “it will ration care, disrupt doctor-patient relationships, and tell patients what treatments they can receive,” according to a recent editorial in The New York Times. The same editorial goes on to characterize these charges as

an outlandish way to describe a board that is prohibited by law from making any recommendations to ration care, raise premiums, increase cost-sharing, restrict benefits or limit eligibility.

The Congressional Budget Office has estimated that repeal of the board would cost taxpayers $3.1 billion over ten years.

Cantor’s strategy is consistent with the Republican charges that compensating doctors for talking with patients about end-of-life care decisions was somehow a “death panel” and charging that taking steps to cut the Medicare budget by $716 billion over ten years constituted taking money out of the pockets of seniors.

One can have a legitimate debate about which is more likely to be successful both in terms of cutting costs and improving care, the ACA approach or the Ryan approach, but to be dishonest about the ACA and to attempt to undercut its measures to rein in costs is the height of demagoguery and to the extent it contributes to deficits hurts all Americans. We deserve better from our elected leaders.

Click here to read the entire Times editorial.

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