The Future of Medicare?

It’s no secret that Medicare is in trouble. The government will have to spend less on the beneficiaries at some point. It’s likely there will be some form of rationing or reduction in care. There are three ways that could be implemented. One way is to put the onus on the patient or consumer to decide which medical care is really essential or desirable. The Paul Ryan Medicare reform plan is one form of that. A second way is to put more of the choice on the Medicare provider. Medicare Advantage plans and their variations over the years are examples of that. The third way is for Medicare to decide it’s not going to pay for certain procedures and treatments. In a recent New York Times article a researcher listed several medicare procedures that are performed routinely and reimbursed by Medicare yet appear to have no real benefits.

This article goes into some detail about that article but also asserts that Medicare will have to go a step further and stop paying for procedures that might improve a person’s quality of life but have no affect on health or longevity.

We have approximately 47 million enrollees on Medicare and knee replacements are done at a rate of 8.6 per thousand, one of the most frequent hospital admissions for the federal insurance program. That works out to more than 400,000 knee replacements each year. At a rate of 17 median taxpayers for each procedure, that suggests we need the entire Medicare payroll contributions of 6.8 million Americans, or 5% of the total number of US taxpayers (138 million), just to fund knee replacements. As you can see we run out of taxpayers pretty quickly.