For the first time in 4 decades the cost of health care’s growth has slowed. This is not bad news however caution must prevail.
“This is understandable given the fact that health care spending represents nearly 18 percent of the overall economy and the Medicare and Medicaid programs combined account for nearly a quarter of the federal budget.”
What factors affect the medical cost trend?
Read more: The Hill
However, despite this good news, or perhaps because of it, it is important that we make a point to emphasize the real and continued need for Medicare reform.
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Much of the slow-down in spending growth can be attributed to the recession, which inevitably slows spending patterns across the board. In addition, the imminent implementation of Affordable Care Act subsidies and Medicaid expansions will further boost spending.
Medicare is projected to add 30 million new beneficiaries in the next 20 years – which will place significant added cost pressure on the program. This trend cannot be altered, nor avoided nor wished away. Adding 30 million people to the program will raise the cost of program and must be dealt with.
As important as program solvency and financial health are, finances are not the only reason to fix the Medicare program. Medicare was developed in the 1960s and, as such, no longer meets the needs of the Medicare patient today. Today’s beneficiaries have different demands; they are living longer with more chronic conditions, and are receiving care in a variety of settings. Medicare must be updated to adapt to these changing demands so that patients can receive the best, most effective care.”
Physicians no longer practice 1964 medicine and in the 21st Century there will be further advances. The business and payment models and governance also must change. Currently we have 2013 autos running on 1940s roads. It is no wonder health costs have escalated. The old system has been inadequate.
In addition to reforming the SGR (sustainable growth rate for physician fees),
Policymakers should look past the narrow reforms and short-term cost trends to deliver to beneficiaries a program that better meets their needs.
The Future for Medicare:
What You Need to Know
There are four proposals currently before Congress to reform aspects of Medicare. The Medicare Board of Trustees' 2013 report projects the Hospital Insurance Fund would become insolvent after 2026.
This process is inextricably interwoven with current reforms including the Affordable Care Act, the formation of Accountable Care Organizations and major reimbursement reform (including conversion from ICD-9 to ICD-10 as well as health information technology, including electronic medical records, health information exchanges and health benefit exchanges come on line in 2014.
The challenges for health care professionals is enormous.
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