USA Today
One thing I think we need to be careful about in the health care/reform/policy debate is to be clear on what's happening in the real world. When we argue about what Congress and the WH are doing about entitlements, we don't want Medicare ended as we know it, or gutted, or privatized. We want it supported so it will function. But reforms (including funding and price reforms) are needed. Why?
This is why:
Medicare and Medicaid spending rose 10% in the second quarter from a year earlier to a combined annual rate of almost $992 billion, according to new data from the Bureau of Economic Analysis (BEA). The two programs are on track to rise $90 billion in 2011 and crack the $1 trillion milestone for the first time.
The jump in health care spending is the biggest since the Medicare prescription drug benefit was added five years ago and ends a brief lull in the spending increases that occurred during the economic downturn.
The debt limit and spending package approved by Congress and Obama don't restrict costs of Medicare, Medicaid and other entitlement programs. The rapidly escalating costs of the health care programs will challenge lawmakers seeking to rein in federal spending in the future, especially in 2014, when coverage expands to people who are uninsured now.
As people age, they use more services. As people lose their jobs and lose health insurance, they use more government services.
The latest spending surge in federal health care is driven by more people getting more treatment, not by price increases. Health care inflation is at its lowest level in more than a decade — a 1.7% annual rate — but the aging population and the weak economy are sending more patients to government-financed care.
Back in 2008, I wrote about some of
the effects of recession on the health care safety net, and the issue of losing insurance and taking years to get it back is still with us. The health care safety net is crucial but also expensive.
One way to keep costs down is making sure money isn't wasted on advertising and excess profit.
Some of the most popular prescription drugs are about to get a lot cheaper. According to the mail-order pharmacy Medco, at least 22 prescribed medications may be available as generics in the next year...
Drugs becoming available as generics can save patients a great deal of money. CNN called local pharmacies across the country to get an idea of how much a 30-day supply of some of these brand-name prescriptions cost.
20mg Lipitor is nearly $186, 75mg Plavix runs $215 dollars, 10mg Singulair is $182 dollars and Zyprexa runs more than $400 dollars for a 30-day supply of the 5 milligram dosage.
There’s no clear indication how much cheaper the generic versions of the drugs will be, but for comparison the well-known depression drug Prozac became generic 10 years ago. Now it sells for less than $16 dollars for a one-month supply.
Another way to save money is to
cut back on payment to providers (I'm a pediatrician and don't treat Medicare patients, but I see plenty of patients with no insurance, underinsurance and Medicaid).
But the budget cutting may end up hurting some of the neediest seniors as the federal cuts take a disproportionate toll on family physicians with many elderly patients and on hospitals that serve them.
Medicare is among many government programs, including the military, that could face significant cutbacks as a result of the debt compromise.
Just a reminder that there are no simple solutions, and that we need to stay on top of those that are being proposed ... for all sorts of reasons. And when we say "don't touch entitlements" that's shorthand for "yes, reforms are needed but ye who are not trusted to do reforms right, hands off."
Update: HeyMikey added a terrific link from Austin Frakt (The Incidental Economist) on some ideas for bringing costs down.