Troubled Medicare Troubles Many
Dr. Robert Moffit, Director
Center for Health Policy Studies, The Heritage Foundation
special to AgeVenture News Service 06-13-03
Senate Minority Leader Tom Daschle, D-S.D., recently wrote in a letter to President Bush that
he wants the president to "put aside" his proposal to "privatize Medicare."
It would be too expensive, Daschle says, citing a recent study that found that private plans pay 15
percent more than Medicare does for the same medical services.
Daschle doesn't note that Medicare's payments don't come close to covering the full bill or that the
average Medicare patient pays roughly $2,000 per year to cover the shortfalls. He doesn't talk
about the crisis situations that have erupted in some cities because doctors refuse to take on
new Medicare patients.
Yet this problem has reached a breaking point, particularly in Denver and Seattle. In Denver,
only a third of the doctors say they will accept new Medicare patients. That's down from 52
percent in 2001, a rate of decrease that Kathy Lindquist-Kliessler, executive director of the
Denver Medical Society, calls "alarming." In Seattle, the percentage of doctors who accept new
Medicare patients fell from 71 percent to 55 percent in four years, according to the
Washington-based Center for Studying Health System Change.
Gaining access to doctors, particularly specialists, has become increasingly difficult for
seniors. Another report by the Center for Studying Health System Change indicates seniors are
waiting far longer to see doctors for checkups and even for specific illnesses, that the
proportion of physicians who accept all new Medicare patients is falling (from 74.6 percent to
71.1 percent in just four years) and that the percentage of surgeons willing to operate on new
Medicare patients is falling faster still -- from 81.5 percent to 73 percent in the same
period.
Medicare controls its costs by limiting benefits and setting artificially low fee
schedules for the services it does cover. Last year, for example, Medicare unilaterally cut
physician payments 5.4 percent. And doctors, who have seen the costs of operating a medical
practice increase 60 percent in the last decade, can't and won't take such hits much longer.
The American College of Physicians, the source of the 60 percent figure, had to revise its
guidelines recently to accommodate doctors who want to recover some of these rising costs by
charging for phone consultations, filling out forms for patients and handling non-emergency
matters during their off hours.
Senator Daschle and others erroneously charge that President Bush wants to remedy the situation by
"privatizing" Medicare, a measure they say would require seniors to join HMOs to receive their
prescription-drug benefit. But President Bush proposes only that seniors be offered a benefits program broadly similar to
that enjoyed by Senator Daschle and his staff, as well as 9 million other federal employees,
dependents and retirees. It's called the Federal Employees Health Benefits Program (FEHBP).
FEHBP is a government program that offers beneficiaries a variety of plans with different
features. Enrollees can choose, for instance, to keep their doctors.
What takes the cake is that Senator Daschle says President Bush's plan "doesn't work," when
what clearly doesn't work is Medicare. It doesn't work for doctors or hospitals, which are
fed up with its slow reimbursement, more than 111,000 pages of rules and paperwork and a
nearly indecipherable price-control system.
Increasingly, Medicare doesn't work for patients, who are finding it harder and harder to
locate a doctor. It doesn't work for all seniors, who pay more than half of their health-care
costs out of pocket because Medicare has such big gaps in coverage.
The point is: Medicare is in trouble. Meanwhile, the federal employees' health program provides
a blueprint for a more affordable way to add a prescription-drug benefit for seniors, fully
integrated into a health-insurance package. This is a system in which patients choose, private
companies respond and taxpayers save. Which is a lot more than Senator Daschle, or anyone else,
can say for Medicare.
See related articles in the AgeVenture archives.
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