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MEMBER DIARY

Entitlement Recommendation Going Forward

Here is a position paper on Entitlements in general and medical entitlements in specific.

 

This year I turned 65 and in accordance with my former company’s policy, my health care transferred to Medicare from what was a top flight private program.  Am I happy about this?  Well, yes in a way and no in another way.

 

Yes:  the cost of the Medicare program to me dropped dramatically. I assume this is because of the taxes I paid during my working career and just as likely, because the taxes that other people have paid and are still paying.  My old private care – which was low co-pay and see any private specialist that I wished – cost $1000 per month.  The new coverage cost $153 per month and $ 250 per month for prescription and gap coverage. I still can see any doctor that I wish without a referral.  So the cost out of pocket has declined.  I have yet to establish the level of c o-pay but I would assume it will be about the same.  In other words, the level of care seems to be about the same but the cost has dropped.  (I do note that physicals are no longer covered, but my friends say the doctors simply see you and do blood work and don’t call it a physical.)

 

No: the concern here is that the government is not running the program at the break even level.  We are setting aside debts that some future tax payer will have to shoulder and this is wrong.  It does not matter whether you are a democrat and believe everyone should have the same level of health care or you are a republican and believe that health care should depend on the decisions made over a life time, such as how much money to make, how much to save, and what level of insurance one purchases.  The problem is that the current program is no fair in a generational sense. 

 

So I am looking at a proposal provided by Bach and Pearson:

http://content.healthaffairs.org/cgi/content/abstract/29/10/1796

Here is a short summary of the idea.

 

It is from far the most radical out there. The full costs of treatments would be covered for three years, which would still give companies an incentive to innovate.

After three years, absent evidence that a treatment was better, Medicare would pay no more than it paid for equally effective treatments. Only $10,000 of the bill for proton therapy, for instance, would be covered. The blank checks would not go on forever. New treatments would bring a windfall only if they improved health.

 

 

So I look at the levels of care for prostate cancer, Radiation at $10,000, $42,000, or $50,000 and I notice that surgery is not noted but in general costs about the same when hospital and all associated costs are combined.  What should the government program pay?  And, how should it be implemented?  In the case of prostate cancer treatment, the cheapest treatment option would be covered by Medicare.

 

Pay: 

One approach to keep the government from bankrupting the U.S. treasury would be to establish specific limits for various treatments.  This appeals to me because I firmly believe we should be responsible for our own care.  If a set payment were provided and established by some system that ended up not bankrupting the Treasury, then I would support it.  However, there is a caveat.  The person electing treatment should be allowed to pay for the remainder of the cost if a higher cost treatment is selected.  This is contrary to most health care proposals in existence today.  In fact, there seems to be a rule that does not permit health care professionals from even mentioning treatments outside the limits of the individual’s health care formulation.  If this provision is not included I would not be in favor of the proposal.

 

Implementation:

If this was implemented, the first thing wealthy persons would do is form an insurance company to cover the higher cost treatments over and above the Medicare set limits.  Then people with means would in effect be buying a supplemental plan that covered the things not covered by Medicare.  This sounds a lot like private insurance for the elderly.  It appeals to me, because the person without means is covered at a level that will not break the bank (presumably) and a person with additional means could buy a supplemental policy to cover higher costs – presumably because of specialist care in specialist locations.  In other words, the wealthy would have a better level of care.  It certainly is a break from the original Medicare concept but it is time that an approach such as this be implemented.

 

 

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