Trendspotter: Medicare as a Political Football

April 7, 2011

With the looming lockout of the National Football League, keeping tabs on what is happening with Medicare may be enough drama and intrigue to tide us all over through a cold winter if our favorite pro teams decide to sit on the sidelines rather than take to the fields.

With the looming lockout of the National Football League, keeping tabs on what is happening with Medicare may be enough drama and intrigue to tide us all over through a cold winter if our favorite pro teams decide to sit on the sidelines rather than take to the fields.

First, it appears the federal program will avoid making headlines if a government shutdown becomes a reality. Payments for Medicare, Medicaid, and Social Security will all go out as planned, unless the dollars tug-of-war in Washington, D.C. continues for a longer period of time. So - at least for now - Medicare escapes that national stage.

But Medicare was front and center this week as Rep. Paul Ryan (R-Wisc.) unveiled the "Path to Prosperity," a FY 2012 budget resolution on behalf of the U.S. House Budget Committee, of which he serves as chairman. The document contains lots of cuts to federal programs and "crosses the third rail," so to speak by taking on some of the nation's most dangerous political topics, such as Medicare.

In a nutshell, the proposal would first outright repeal the Affordable Care Act, rendering most of the impact on Medicare for the years to come useless. Notably, the proposed Independent Payment Advisory Board, a 15-member panel to investigate extending the life of Medicare and lower costs, would not convene at all. Ryan notes in his proposal that any savings generated by streamlining Medicare should stay in the program, and not "pay for new entitlements" under federal reform.

The plan also ensures that today's retirees (and near-retirees) access the program as it exists today, but in the future today's younger workers would access a new and improved Medicare. According to Ryan's plan, come 2022, Medicare beneficiaries would be enrolled in the same kind of healthcare program as members of Congress - given a choice of a list of coverage options to choose what is best for them.

Ryan dispels the notion that this is a "voucher program," saying instead, it is "a premium –support model," where a payment is paid by Medicare to the plan selected by the beneficiary. He likens it to the way the Medicare prescription drug program works today and also says that those earning more would receive a lower subsidy, with more help for those with lower incomes. The goal, he says, is financial stability for the program.

Seniors who are currently enrolled or becoming eligible in the next decade could also opt in to this program if they wanted.

And yes, the plan also addresses the dreaded sustainable growth rate (SGR) in payments to physicians. The same program that delayed double-digit cuts in reimbursements in Dec. 2010 until a solution is hopefully generated by this December, Ryan says it is time for a long-term solution to what is becoming a year-to-year problem.

The budget proposal would "fix" the physician payment formula for the next decade, ensuring Medicare beneficiaries get the care they need with the doctors they prefer and also "fairly compensates physicians who treat Medicare beneficiaries while providing incentives to improve quality and efficiency," according to the text of the proposal. Details are forthcoming, one would believe, on how this is to be done.

The bottom line, however, is a question that has come up several times during the ongoing debate over reforming the SGR: Will physicians keep participating in the Medicare program during a wave of political promises and short-term solutions?

Leading up to December's extension, we saw and heard numerous tales of physicians freezing their Medicare rosters or outright dropping patients given the uncertainty of future reimbursements. Others said they found it unethical to stop treating Medicare beneficiaries who rely on the program for their care.

So much like the looming lockout in professional football, you have two sides arguing over money and a whole nation of others screaming "Hey, don't forget about us," during the debate. While potentially life-saving care is not even close to a Super Bowl, professional athletes, team owners, lawmakers, and others need to realize that the games they play matter to millions who are often left out of the discussions, but are subject to the rhetoric and blame game.

Stay tuned to see what the coming weeks bring in the Medicare Showdown and the talks over the future of the National Football League. Both could lose a lot of support without a decent resolution.