One of the obvious targets to try to control government spending is Medicare.\u00a0 The expected cost for 2011-2012 will be $483 billion.<\/p>\n
How realistic is it to think that we could cut $400 billion (75%) of the budget of Medicare by getting rid of useless medical procedures and medications?<\/p>\n
First some basics, for those who haven’t yet concerned themselves with what Medicare is (or isn’t).\u00a0\u00a0\u00a0\u00a0 Medicare doesn’t pay for long term nursing care – that’s the patient’s responsibility, or State Medicaid if the person is poor (or some lawyer strips the assets away from the parent to give it to the children)<\/p>\n
Medicare Part A pays in-patient hospital bills.\u00a0\u00a0 Part A is paid entirely out of the trust fund.\u00a0\u00a0 There is no premium paid by the patient.\u00a0\u00a0 It will also pay for short term skilled nursing care following a hospital stay, and hospice care for those with a terminal illness, and home health care visits.<\/p>\n
\u00a0Medicare Part B pays for medical care done by the doctor\u00a0 – doctor fees, surgeon’s fees, tests, wheelchairs, physical therapy, oxygen, and services done in as an outpatient.<\/p>\n
Medicare Part B is optional – paid for partly by a monthly premium.\u00a0\u00a0 If you decide not to pay for Part B, you can only then get coverage during the annual enrollment period (Jan-Mar) and you will be charged a higher premium than if you had coverage all along.\u00a0\u00a0 For 2011, the standard Part B premium is $115.40 a month (less if you have it deducted from your social security check) and more if you’re a “rich” person – up to a maximum of $369 a month.<\/p>\n
Medicare Part D (thanks GW!) covers medications that you take yourself (Part B covers medications if they require a trained medical person to administer).\u00a0\u00a0 What Part D costs is very complex – you pay a premium to an insurance company (typically $35 a month), and that covers you up to around the first $2800 per year (with a $310 deductible) – then you hit the “donut hole” – the next $2000 is entirely paid by the patient – unless they accept generic brands, in which case they only pay 50%…\u00a0 Beyond $4550\/yr, you’re in the Catastrophic part D portion, that covers most of the drug costs\u00a0for the expensive \/ exotic drugs.<\/p>\n
Keep in mind that Medicare is also available to people on Social Security Disability younger than 65.\u00a0\u00a0 Disability coverage begins 6 months after the point in time\u00a0at which Social Security says your inability to work began.\u00a0\u00a0 Note that for children (like with “autism”), the ability to perform work doesn’t apply – only that there is a diagnosis.\u00a0<\/p>\n
Medicare Part C is called Medicare Advantage – basically an HMO\/PPO type plan that covers Parts A, B and D in a single plan.\u00a0\u00a0 Medicare pays a part of the costs, and you pay whatever the monthly fee and deductible is that the plan you choose requires.\u00a0\u00a0 Each January, you have the option to switch back to “original” Medicare A\/B\/D<\/p>\n
Here is the Trustee’s spending report for 2011<\/p>\n
https:\/\/www.cms.gov\/ReportsTrustFunds\/downloads\/tr2011.pdf<\/a><\/p>\n Not surprisingly, the numbers don’t quite match up – keep in mind the Budget spending number is a “net” spending – part of the income paying for Medicare is the Part B Premiums.<\/p>\n The total expenditures of Medicare in 2010 was $522 billion.\u00a0\u00a0\u00a0 $116 billion of that was paid for the people who “Opted out” of Original Medicare and use a Part C plan administered by an insurance company.<\/p>\n Part A – Hospital coverage<\/strong><\/span><\/p>\n Number of people covered:\u00a0 47.1 million\u00a0\u00a0 (7.9 million are disabled) Who pays for it?<\/strong> Part B – Medical Services<\/strong><\/span><\/p>\n Number of people covered:\u00a0 43.8 million\u00a0 (7.1 on Disability) Who pays for it?<\/strong><\/p>\n General fund:\u00a0\u00a0 $153 billion\u00a0\u00a0 (Income tax \/ borrowing) Since Part B is not funded by\u00a0a dedicated tax, it is “pay as you go” – the general fund pays 3\/4 of the cost, the patients pay the remaining part through their premium.\u00a0\u00a0\u00a0 People receiving\u00a0Part B never “Paid into” Medicare.\u00a0 It’s 75% a gift paid from current taxes paid by\u00a0the people not yet on Social Security.<\/p>\n Part D – Prescription Drugs<\/strong><\/span><\/p>\n People covered:\u00a0 34.5 million Who pays for it?<\/strong><\/p>\n General Fund:\u00a0\u00a0 $51 billion\u00a0\u00a0\u00a0\u00a0 (thanks, GW!) Average annual benefit paid per enrollee (A+B+D):\u00a0\u00a0\u00a0 $11,762\u00a0 <\/strong> Now, before we start whacking out 80% of these expenses, keep two things in mind.\u00a0\u00a0 There are 47 million voters getting this benefit.\u00a0\u00a0 Those 47 million people also have relatives who will either have to pay for their parent’s medical care, see\u00a0the size of their\u00a0“estate” shrink, take care of their own parents or watch their parents die.\u00a0\u00a0\u00a0 We are all socialists now.<\/p>\n If we cut out 80% of the benefits paid by Part B, then it is probable that people would no longer be willing to pay 25% of the cost of the program.<\/p>\n So put your cost cutting axe to this program, and let me know where you find the savings.<\/p>\n By the way, how much will the GDP of the economy go down when half\u00a0of the people working today in health care are unemployed and they no longer pay taxes, can’t pay their mortgage…?\u00a0 and all the universities and medical training schools that no longer are in business since there is no demand for medically trained people….<\/p>\n","protected":false},"excerpt":{"rendered":" One of the obvious targets to try to control government spending is Medicare.\u00a0 The expected cost for 2011-2012 will be $483 billion. How realistic is it to think that we could cut $400 billion (75%) of the budget of Medicare … Continue reading
\nHospital Bills:\u00a0 $136 billion
\nSkilled Nursing:\u00a0 $29 billion
\nHome Health Care:\u00a0 $7 billion
\nMedicare Advantage premiums:\u00a0 $61 billion
\nAdministrative:\u00a0 $3.5 billion\u00a0
\n\u00a0 — total expenses:\u00a0 $247.9 billion<\/p>\n
\nPayroll Taxes:\u00a0\u00a0 $182 billion
\nTrust Fund Interest:\u00a0\u00a0\u00a0 $13.8 billion
\nTaxes on benefits paid to the “rich”:\u00a0\u00a0 $13 billion
\nPremiums:\u00a0 $3 Billion\u00a0\u00a0 (todo:\u00a0 Who can “buy into” Part A coverage?)<\/p>\n
\nHospital bills (outpatient):\u00a0 $32 billion
\nHome Health Care:\u00a0\u00a0 $12 billion
\nDoctors:\u00a0\u00a0\u00a0\u00a0 $64.5 billion
\nPart C premiums:\u00a0\u00a0 $55\u00a0 billion
\nOther:\u00a0\u00a0 $46 billion\u00a0\u00a0\u00a0 (testing procedures, 2nd opinions)
\nAdministration:\u00a0 $3.2 billion
\n\u00a0 — total expenses:\u00a0\u00a0\u00a0 $212.9<\/p>\n
\nPatient Premiums:\u00a0\u00a0 $52 billion<\/p>\n
\nExpenditures:\u00a0\u00a0 $61 billion\u00a0 ($1,789 per person per year)<\/p>\n
\nPremiums:\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 $6.5 billion<\/p>\n
\n(About 15% of which is paid by enrollees through their premiums)<\/p>\n