Fixing Medicare

Through payroll deduction, we pay for Medicare Part A our whole working lives.  Still, the revenue stream is insufficient for Medicare Part A (the hospital side, which is growing faster than any other part of Medicare besides prescription drugs). Medicare Part A has the power to negotiate price as well (but recently its ability to negotiate price for drugs was constrained by wording in Medicare Part D.) There are many other factors contributing to Part A problems, including for-profit medicine, fraud, abuse and others.  Books have been written about how to improve hospital care, so I will not belabor that here.

Medicare Part B (generally for doctors, x-rays and lab work) has the infusion of premium dollars AND the benefit of negotiated price.  For Part B the better off among seniors also pay more.  There is also Part C, Medicare Advantage Plans, which have notoriously been overcompensated by Congress with subsidies they do not need.  These subsidies have been subtracted from other parts of Medicare.  By design, this was intended to defund regular Medicare and drive patients into privatized plans.  It’s done the opposite.  Patients aren’t all that happy with their private plans.  Some plans fold.  And many seniors try to get back in, but have to wait until the annual enrollment period (thus having a potential gap in coverage) and they pay a higher price than had they stayed with regular Medicare all along.

Medicare Part D (prescription drug benefit) is the individual prescription drug program.  It can still burden financially with the so-called do-nut hole, even while “covering” the patient. But the Congress does not allow negotiation for price for medications used for hospitalized patients under Part A or prescribed to individual patients under Part D.  So, for example, a patient in the do-nut hole would pay full price (often $350 per month for a widely sued asthma inhaler) and hospital patients can be charged ridiculous prices for  single pill costing far, far less.  It doesn’t have to be that way. The Congress also enabled pharmaceutical firms to extend the length of time for their patents. This hurts both Part D recipients and Part A recipients.  There are so many ways to improve Medicare Part A, which I have not mentioned. To help cost cut Medicare Part A (the portion most needing fixing) and relieve individuals covered under Part D would require permitting price negotiation, outcome-based treatments, reduction of off-label uses, improved oversight for fraud, better research, and improved education about how to take medications.