FindingSolutionsforSocialSecurity,MedicareandMedicaid

ByKevinBoyd,CandidateforCongress,IndianasThirdDistrict

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 INTRODUCTION TherearesignificantchallengesthatfacetheAmericanpeople.Apieceoftheproblemisthebasic disconnectbetweentheservicespeopleexpectfromgovernmentandtherevenuespeoplearewillingto sendtothegovernmenttofinancethoseservices. Yetbeyondthisbasicdisconnect,thereareunderlyingfinancialchallengesthatmustbesolvedto protecttheelderly,thepoor,thedisabledandotherswhodependonallofusworkingtogetherto providecareandsupportforoneanother. Thegoodnewsisthesechallengesarenotinsurmountable.Ifweworktogether,addressingtheissues withoutdoingharmtothoseinthemostneed,wecanreachsolutions.

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 SOCIALSECURITY Themajorityofbeneficiarieshavelittlesignificantincomefromothersources,sotheirSocialSecurity paymentsareanecessity.RecentprojectionsprovidethattheSocialSecurityprogramwillremain solventthrough2033,butthatmustnotdriveustocomplacency.Byaddressingtheissuesina reasonablewaytodaywecanassuretheprotectionofSocialSecurityintothe22ndcentury. Atpresent,SocialSecurityhasataxableincomebaseof$110,000.Thisisthemaximumamounton whichaworkersearningsaresubjecttothepayrolltax.Thisamountalsoprovidesthebenefitcap,the maximumamountusedtocalculatebenefits. AreportfromtheCongressionalResearchService,SocialSecurity:RaisingorEliminatingtheTaxable EarningsBase,saysthat,Raisingorremovingthetaxableearningsbasecouldreduceoreliminatethe longtermSocialSecuritydeficit.1 ToeliminatethelongtermdeficitandprotectSocialSecuritybeyondthiscentury: 1) Phaseinoverfiveyearsaneliminationofthetaxableearningsbase,thusmakingallearnings subjecttotheSocialSecuritypayrolltax.Thisalsoeliminatestheeffectsofrisingincome inequalityandaprojectedlowerportionofallpayrollmakingcontributions. 2) Decreasethepayrolltaxtoa12.12%rate.Eliminatingthetaxableearningsbaseallowsustoalso decreasetheoverallpayrolltaxrateforSocialSecurity. 3) Maintainthegrowthinthemaximumbaseonwhichbenefitsarepaidaccordingtothecurrent baseandtheformulacontainedincurrentlaw. ThesethreecommonsensestepscansaveSocialSecurityforthisandfuturegenerationsofAmericans.

SocialSecurity:RaisingorEliminatingtheTaxableEarningsBase,JanemarieMulvey,SpecialistinAgingand IncomeSecurity,CongressionalResearchService,September24,2010,p.8

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 MEDICARE Medicareconsistsoffourparts: PartAHospitalInsurance,financedthroughpayrolltaxes PartBSupplementalMedicalInsurance,financedthroughgeneralrevenuesandmonthly premiums PartCMedicareAdvantage,atypeofMedicarehealthplanofferedbyaprivatecompanythat contractswithMedicaretoprovidePartAandPartBbenefits.Medicarepaysafixedamountto theMedicareAdvantagePlanandeachplancanchargedifferentoutofpocketcostsandhave differentrulesonhowservicesareprovided. PartDOutpatientprescriptiondrugbenefits,financedbygeneralrevenue,statecontributions, andbeneficiarypremiums. Thesefourprogramsfundsaremaintainedintwogovernmenttrustfunds,theHospital InsuranceTrustFund(whichcanproduceannualsurplusesorshortfalls)andtheSupplemental MedicalInsuranceTrustFund(whichisadjustedannuallytoeliminatesurplusanddeficit).Itis criticaltoaddressbothofthesefundsandtheoverallprogramtoprovidesolutionstotherising costofMedicarewhilemaintainingbasichealthcareservices. ToaddressthechallengesfacedbyMedicare: 1) MaintainthecommitmenttotheAffordableCareActanditsprojectionsofoverallsavingsin healthcare.AbasicnecessityincontrollingMedicarecostsistocontroloverallhealthcare spending. 2) EliminateMedicareAdvantageandenrollallMedicareeligiblepersonsinoriginalMedicare. MedicareAdvantagewasoriginallyenvisionedasacostsavingsprogrambuthasprovento betheopposite. 3) InstitutechangesendorsedbytheMedicarePaymentAdvisoryCommissiontomake changesinhowservicesaredelivered,howprovidersarepaid,andtoinstitutegreater efficiencytotheprogram.Thesechangesinclude: a. Bundlingpaymentsforinpatienthospitalandpostacutecareservices b. Modifyingpaymentsforpreventablehospitalreadmissions c. Tyingpaymenttoperformanceonqualitymeasures d. Bettermanagementofcareforthechronicallyill e. Incentivepaymentstoproviderswhomeetefficiencyandqualitygoals 4) IncreaseeffortstofindandprosecuteMedicarefraudandupcodingofpatientservicesto padtheinvoicessubmittedtoMedicare. ThesecommonsenseactionswillhelpprolongthelifeofMedicare,willimproveandprotectthe necessaryservicestobeneficiaries,andallowtimetocontinueaddressingthehealthcarechallenges facingAmerica. PAIDFORANDAUTHORIZEDBYBOYDFORCONGRESS3

 MEDICAID MedicaidisthelargestpublichealthinsuranceprogramintheUnitedStates.Itcoversoversixtymillion lowincome,disabled,andelderlyindividualsmostofwhomwouldbeuninsuredwithoutthe protectionsMedicaidaffords.SixtypercentofthepeopleinnursinghomesdependonMedicaidfor theircontinuingcare.Infact,Medicarefinancesaboutseventeenpercentofallhealthcarespendingin theUnitedStates. TheRomneyRyansolutionistoturnMedicaidintoablockgranttostates.Thisdoesnotsolvethe problem.Rather,ittransfersthemajorityoftheproblemtothealreadystrugglingstatebudgets.Their proposalwillbedevastatingforseniorsandthosethatprovideservicestothemostneedyinoursociety. Medicaidhasabroadroleinourfragmentedhealthcaresystem.AbouthalfthoseenrolledinMedicaid arechildren,anotherquarterarenonelderlyadults,whilethefinalquarterareseniorsandpersonswith disabilities.Medicaidsmostuniqueandcostlyundertakingisprovidingpeoplewithdisabilitiesandlow incomeelderlypeoplewithbothmedicalandlongtermcareservices,dominatingabouttwothirdsof Medicaidspending. Thetruthis,however,thatMedicaidisinrealityalowcostprogramwhencomparedwithotherhealth carespending.SomeofthechallengesMedicaidfacescomefromthefactthatmanyofitsbeneficiaries haveamuchpoorerhealthstatusthanthegeneralpopulation.Thesearethesickestandneediest peopleinAmerica,themostvulnerableandthemostinneedofourassistance.Thusthesubstantial investmentoffederalandstatedollarsdoprovideaneffectivereturnoninvestmentintermsof improvinghealthcareaccessforourlowincomepopulation. MuchoftherapidincreaseinMedicaidspendinghasbeendrivenbyenrollmentincreasesdrivenbythe lossofincomeandprivateinsuranceduringthecurrenteconomicdownturnalongwiththeincreasing hospitalandprescriptioncosts,whichhaveaffectedtheentirehealthcaresystem. ThedauntingproblemforMedicaidis:Howdoweprovidethenecessarysafetynet,whichMedicaid providestoourmostvulnerablepopulationwithintheconstraintsoffederalandstatefinancing? Federalandstatebudgetconstraintsandthegrowingfederaldeficitmakethisachallenge.Itisa challengewemustmeetwithresponsibleproposalsthatassurethemostfrailandvulnerableamongus areprotectedandreceivethehealthandlongtermcareservicesthatarecriticaltotheirsurvival. ToaddressthechallengestoMedicaid: 1) Eliminatepaymentofemergencyroomservicesfornonemergencycare.Thisismeantto encourageMedicaideligiblepersonstoseekmorecosteffectivemedicalservicesfornon emergencytreatment. 2) AsprovidedintheAffordableCareAct,increasetheratesatwhichdoctorsarereimbursedfor MedicaidservicestomatchthelevelofMedicarereimbursement.Thiswillencouragemore physicianstotreatMedicarepatientsandhelpeliminatetheirturningtoemergencyroomcare forbasichealthservices. PAIDFORANDAUTHORIZEDBYBOYDFORCONGRESS3

 3) AsprovidedintheAffordableCareAct,makenewinvestmentsincommunityhealthcentersto providebasicandpreventativecaretotheMedicaideligiblepopulation. 4) Instituteaconsultationbetweenthefederalandstategovernmentsaimedatcreatingasingle sharedMedicaidprograminsteadoffiftyseparateMedicaidprograms.Goalsoftheconsultation wouldbetodefinebasicservicesprovided,establishareasonableandequitablecostsharingby thefederalandstategovernments,andtoestablishnationalguidelinesforeligibility. 5) Instituteamodest,meansbasedcopaymentforbasicservices.Thiswillhelpbeneficiarieswho areabletoparticipateresponsiblyintheirownhealthcare. 6) CreateacompetitivebiddingstructureforbasicservicesandsuppliesprovidedbyMedicaid, establishingmarketplacesavingsasawaytoholddownrisingcosts. ThecomplexityoftheMedicaidprogramandthevulnerablepopulationitprotectsmakeitthemost difficultandmostimportanttoaddressthechallengesitpresents.Beginningwiththepremisethatits basicmissionofbeingahealthinsuranceproviderforsingleparentswithdependentchildren,theaged, theblindanddisabledisavaluewecherishasAmericanswillhelpuscommittomakingthecourageous choicesnecessary.

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