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No Health Reform Plan Features Major Medicare Changes

Janice Simmons, for HealthLeaders Media, August 21, 2009

Whether in the halls of Congress or in town hall meetings, the debate should not be whether Congress keeps its hands off Medicare, but how it should regulate Medicare—and do it in the way that provides the maximum benefits to the public, said Eugene Steuerle, vice president with the Peter G. Peterson Foundation, at a conference held Thursday by the journal Health Affairs to address healthcare reform.

The fact remains that "Medicare and health spending are on an unsustainable path," said Steuerle, an economist. However, no major Medicare reform currently is on the table as part of healthcare reform—nor is it really likely to appear during 2009.

For the most part, Medicare reforms that are being discussed under healthcare reform are "fairly modest," with most of them relating to providing information that might be to control costs later, he said. However, next year may be a different story when Congress realizes it is going to have to start addressing these deficit issues, he said.

What is fact is that the tax rate that's required to support Medicare is creeping up, Steuerle said. For instance, in 1975, the rate was about 2%, and in 1990 it was 4%. By 2010, it will reach 7%, and in another 20 years, it could jump to about 14% at current rates. With no changes by Congress, that would mean that it would take almost the entire Social Security tax rate (now 15%) just to pay for Medicare alone.

On another note, in the midst of the healthcare debate, "you hear so many people correctly say: 'This looks more like a sick care system than a healthcare system,'" said Darrell Kirch, MD, president and CEO of the Association of American Medical Colleges in Washington, DC.

"The colleagues that I speak with know that being paid to intervene when illnesses have gone too far is not what they went to medical school to do," Kirch said.

Many of these colleagues say that they are ready to consider alternative payment method and to start focusing on value and outcomes—as opposed by volume. However, this is "unfortunately being talked about only peripherally in this debate," he said.

One issue that has become controversial in the healthcare debate is end-of-life care. Christine Cassel, MD, president and CEO of the American Board of Internal Medicine, has found this ironic in a way.

Through working with patients, Cassel has found that many people want to have a sense of control and dignity and they are concerned about being burdens on a family--both financially and emotionally.

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