The selection of Representative of Paul Ryan as the presumptive Republican nominee for the office of Vice President, prompts me to repost this blog (originally posted in March) surveying Ryan's plans to deconstruct the existing Medicare and Medicaid programs. "
To understand the profound implications of the Ryan proposals to deconstruct Medicare and Medicaid, it bears repeating that these two federal programs together pays for 75% of the approximately 1.2 million residents living in a skilled nursing facility (SNF). Any proposal to redesign these programs will profoundly affect the lives of the program participants and reshape the entire long-term care services and supports industry. Features of Representative Ryan's proposal include:
- Gradually raise the eligibility age to 67 by 2034;
- Cap Medicare spending growth at GDP growth plus 0.5 percent;
- Turn Medicaid cover to the states in the form of a federal block grant (estimated cut to Medicaid spending by $810 billion over 10 years);
- Future Medicare beneficiaries would be provided a sum of money - those under the age of 55 - to purchase either a private health plan, or the traditional government-administered program through a newly created Medicare exchange beginning in 2023. This is a premium support/voucher model and its implementation would end the Medicare entitlement as it has existed since 1965.
When does quality matter?
Placing aside the obvious concerns regarding the Ryan proposal (i.e. where would average Americans find the financial resources to pay the gap between their voucher and their actual expense) I wonder how this reform would impact trends to place expand existing (and create new) community based services and supports along with a desire to improve outcomes? There is little talk about this concern from Rep. Ryan or from the think tanks which support the plan.
Interesting research presented by R. Tamara Konetzka PhD, associate professor at the University of Chicago, sheds light on the complicated relationship between reimbursement and quality outcomes. Recognizing that SNF Medicare revenues subsidize low Medicaid rates (Illinois rate is lowest in the nation) Professor Konetzka studied the impact of the Medicare prospective payment system (PPS) implemented on SNF's in 1998 on quality of care. Interestingly, although no impact could be found among the Medicare SNF population outcomes, the long-term stay residents (whose primary payment source is Medicaid) experienced a great risk of urinary tract infections as well as pressure sores. Apparently, SNF providers reduced staffing needed to care for long-term care residents rather then risking poorer outcomes among the "more important" Medicare patients. At the very least, any proposal to restructure Medicare and Medicaid needs to be viewed from through this prism in order to consider indirect effects.
It also occurs to me that this voucher proposal may only exacerbate a long standing deficiency of the current system. Historically, federal agencies have ignored the need to coordinate the provision (and payment) of services to older adults and only in the past couple of years have initiatives been implemented to improve efficiencies. Not only elder advocates, but the elder care industry has long desired greater coordination, and I wonder whether Rep. Ryan's plan would only further complicate matters? De-funding the current federal system in favor of "pushing down" planning to the state level may lead to greater inefficiencies and not less.
For a profile of older adults in America review this report by the U.S. Administration on Aging. Learn more on Twitter @aginginchicago.