For those of you who are not regular readers of the New York Times, it is worth reading Bill Keller's op-ed column, published on July 29, on baby boomers and the need for entitlement reform. The column unleashed a brouhaha garnering over 450 comments, and so he continued the discussion on a blog post, generating an additional 250 comments: the topic hit a nerve. Mr Keller posits that something must be done to address the looming insolvency crises facing both social security and Medicare (Medicaid is noticeably absent from the discussion) and that baby boomers are the ones to do it. He exhorts:
FELLOW boomers, we have done more than our share to make this mess. It’s not our fault that there are a lot of us, but we have resisted any move to fix the system. We should make a sensible reform of entitlements our generation’s cause. We should stiffen the spines of our politicians, and push lobby groups like A.A.R.P. to climb out of the bunker and lead.
In all fairness to Mr. Keller, I think his call to action is a needed reminder that these problems will not fix themselves, but there are facts missing from his analysis which, if not considered, would impede the ability of the body politic to discuss the concept of reform, let alone devise a plan. Additionally, his concern regarding the solvency of Social Security, although justified, does not inform the debate about what troubles Medicare. The problems are significantly different and combining the topics only serves to rankle extremists on both sides of the political aisle and occludes the possibility of any solutions from being considered.
So where to begin:
The problem of Medicare insovlency is not new. As I've written before, it has been around almost since the program began 47 years ago. A just released report, authored by Patricia Davis for the Congressional Research Service, notes that the insolvency date (currently predicted to occur in 2024) has been postponed a number of times, primarily due to legislative changes that have had the effect of restraining growth on program spending. One such method has been periodic adjustments over the years by Congress to the payroll tax rate. Additionally, other legislative changes (like the Balanced Budget Act of 1997) had the effect of lower expenditures and thus postponing the insolvency date. Although these strategies were sufficient in the past, the current challenges to Medicare solvency, presented by the growing number of beneficiaries and increased health care costs, requires a fresh approach.
If we are truly going to consider the problem of Medicare insolvency, then we must include in the analysis the dysfunctional relationship between Medicare and Medicaid (the nation's chief funding mechanism for long term care services and supports (LTSS)). Because Medicare (generally) pays for medical care and Medicaid pays for long term care (i.e. nursing homes) there is no true coordination of care and services: these are different programs with different agendas. The inefficiencies which result are legendary.
For example, as I posted previously, 9 million Americans are dual-eligibles (both Medicare and Medicaid enrollees) and Medicaid's role focuses overwhelmingly on long term care services and states (traditionally) have lacked the expertise to manage dual-eligibles medical care. Yet, Medicare (i.e. the federal government) has also paid scant attention to the medical care of this population even though it funds 80 percent of the cost of care ($258 billion in 2011) for this population. The dual eligible population accounts for (about) half of Medicare beneficiaries with chronic conditions. Medicare must begin to pay attention to the cost and care of people with chronic conditions.Also, the Older Americans Act and its singular role in the organization and delivery of social and nutrition services to older adults and their caregivers needs to be incorporated into the discussion. How we can bring the necessary services to older adults to maintain their health and dignity, while permitting them to live in the lowest cost setting will require greater coordination between these three programs.
Finally, the demise of the federal CLASS Act should spur efforts to consider an alternative. Perhaps the time has come to consider a premium supported benefit like Medicare Part B and Part D to address the long term care needs of older adults within the Medicare system and thus avoiding the unnecessary barriers to coordinating services. It's worth considering: sooner rather then later.
First, Thomas Friedman frets in his column about Medicare and then, a week later Mr. Keller explores the same territory in his. I welcome the dialogue, but wonder what is going on at the New York Times that provoked both these columns? What are your thoughts? Learn more on Twitter @aginginchicago.