Financial Sustainability of Medicare
User Rating: 0 / 5
- Details
- Hits: 18205
Financial Sustainability of Medicare
Medicare is national social insurance by the federal government in the United States since 1966, with private insurance companies administering the plan to the beneficiaries (Medicare, 2010). Medicare covers those over the age of 65 years and young people with a disability or those with diseases and conditions that other providers do not cover. Some of the diseases covered under the plan are end stage renal disease and amyotrophic lateral sclerosis. With the growing number of people covered, it is clear that the number of those under coverage is growing, and, therefore, there is a need to rethink the way of doing things and on financing.
The cover has become a mega-primary payer for inpatient services hitting close to 50% of the total aggregated pay with those covered standing at over 50 million people with about 80% being those above the age of 65. The federal government is the primary source of finance for Medicare program generating funds through tax (Medicare, 2010). The enrollees pay a set amount of premium depending on the level of the cover a person chooses, and the service provided (Newhouse, 2010). As individuals share costs under the program depending on the degree of care provided to them, the current situation of finance in health is sustainable.
Deductibles and premium are not the same for individuals and can vary each year as the amounts are usually published by the agency administering the plans before the financial period ends. Those over the age of 65 citizens or legal residence for over five years with themselves or their spouse having paid Medicare taxes for ten years or more are the ones who qualify for the cover (Newhouse, 2010). Those who qualify for the social security disability insurance or with conditions qualifying for the plan are also eligible as long as they are beneficiaries of the policy. This means that even as the plan provides cover for those who had not previously paid for the Medicare tax, the contribution to their protection comes from another party.
Current Financial Health and Future Projection on Financial Sustainability of Medicare
It is worth noting that private insurers on the instruction of the agency administering the system implement the Medicare system. Such companies get reimbursement on the amount they incur in administering the plans or get some allocations for the administrations (Medicare, 2010). Such companies have been facing cuts on the amounts of their reimbursement for the services in the past, and as the trend shifts, there is a need to refocus on quality (Newhouse, 2010). The Affordable Care Act of the United States focuses on the provision of higher quality of care at the most affordable rate, rewarding those who maximizes on quality and minimizes the cost.
Even as the sources of the program may not match, the stability of financing comes with the plan that the government has in place to generate funds for the systems through taxing the working groups. This amount of money is sure and has a continual flow to the pool to care for the sick at the advanced age (Harrison, & Zarabozo, 2009). Other than those that are not eligible because of age or payment, the system offers cover on the qualification of health funds by other agencies that sponsor the health of that individual. The partitioning of the plan into groups also gives the agency responsible for the cover to regulate the amount spent depending on the contribution and the ability to share the cost of care within the set amount.
The payment policy and some penalties individuals are subjected to for some reasons are also a source of funds for the plan (Medicare, 2010). Even as the government gets to supplement the funds for the services, it is sure that if properly coordinated, the funds can suffice their use and for all those under the cover considering the base of the contributors. The enrollment to the program is exceedingly growing, and the plan can have sufficient amounts to cater for all those under the cover considering the pool. The system is sustainable because it is a property of the government and because of the stringent measures of control.
Initiatives that Government Might Take to Preserve Medicare
Everyone requires a cover irrespective of the age, and by the fact that the government does not have a universal plan for everyone, opening a cover for eligibility to everyone without limiting in terms of age can be a better option. Given that the cover already exists in categories, it would be better to have groups of the people with the services they require, gender or age other than their ability to pay. It is important to reconsider and reconstitute the plan into one or only two groups, like for group A and C and include category D in both other than having the categories with fragmented services (Harrison, & Zarabozo, 2009).
Even if the cover remains as it is, it is important for the government to concentrate on quality within the minimal amount possible. Concentrating on quality saves from the risk of double charges or the readmission of an individual that would cost the plan more (Newhouse, 2010). Even as the number under the care is growing, it is important that technology in place should be used to ensure adequate service delivery to beneficiaries without any hitch. Policies should be geared towards financial neutrality to generate premium while reducing payment under the plans. It is, therefore, essential to set benchmarks that are more accurate for the deployment of the policy and its contributions (Harrison, & Zarabozo, 2009).