New Study Shows That American Public is Willing to Accept Major Reforms in Medicare Program
Source: Concord Coalition

Although Americans see Medicare as a key part of the country’s social contract and want to preserve it in some recognizable form, they are willing to consider significant changes in the program to hold down its costs as the U.S. population ages.

In day-long “Choice-Dialogues” in which Americans from all walks of life considered the pros and cons of a range of choices for reforming Medicare, common ground was found in several key areas:

• Allow Medicare to negotiate prices for prescription drugs (94 percent support).
• Encourage hospice care instead of heroic end-of-life measures (85 percent support).
• Only cover treatments that are scientifically proven to be effective (68 percent support).
• Emphasize preventive care and personal responsibility (89 percent consider preventive care very important or essential).
• Gradually increase the Medicare eligibility age from 65 to 67 (68 percent support).

If additional money is needed to maintain Medicare in a way that is familiar in the future, Americans would rather see the government raise taxes than increase the federal debt.

+ Medicare: It’s Not Just Another Program (PDF; 9.5 MB)

Controlling U.S. Health Care Spending — Separating Promising from Unpromising Approaches
Source: New England Journal of Medicine

High U.S. health care spending has been characterized not only as a barrier to affordable insurance but also as the preeminent long-term threat to the economy and the competitiveness of American business. The current policy discussion in Congress does not address this problem. The search for government savings with which to fund coverage expansions makes public programs the main targets for spending reductions; opportunities for private-sector savings are left out of the equation. We think it is useful to consider the cost-control options available to both the public and the private sectors.

Although there is no consensus on what should be the target for reducing spending, constraining increases in health care spending to the rate of growth in the gross domestic product (GDP) — and so devoting a fixed share of national income to health care — offers a reasonable goal. To achieve this goal, spending on health care over the next decade would have to be reduced by 6.2% from the amount the Centers for Medicare and Medicaid Services estimates the country would otherwise spend. This proposed reduction provides a framework for evaluating the options now under consideration.

We recently produced quantitative estimates of the likely impact of 12 policy options for reducing health care spending in Massachusetts, and we have extrapolated from that work to produce estimates for the country as a whole. We identified 8 options that evidence suggests have the potential to reduce spending and are broadly applicable to the United States. For these options, we developed high and low estimates of cumulative cost savings over 10 years. The graph lists the options, ranked according to their savings potential, and shows the percentage change in spending that we estimate could be achieved if that policy alone were implemented. If our most optimistic assumptions are reasonable, health care spending can be reduced, but the lower-bound estimates are far more pessimistic, and the substantial spread between the two indicates that the effects are highly uncertain.