State of the Union: MedicareAEI on the HillJanuary 29, 2013Joseph R. Antos, Ph.D.Wilson H. Taylor Scholar in Health Care  ...
Slower Per Capita Medicare Spending in Last 3 Years   6.0%             5.3%   5.0%                                 4.3%   ...
3
Federal spending as a percentage of GDP, Alternative Fiscal Scenario* 18                                                  ...
   Better choices for seniors     Better incentives for providers     More effective competition among      health plan...
   Simplify and improve Medicare’s benefit      ◦ Combine Part A + Part B; single deductible; catastrophic        limit  ...
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AEI State of the Union series: Medicare

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A presentation on Medicare by Joseph Antos at the AEI State of the Union series health care event.

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AEI State of the Union series: Medicare

  1. 1. State of the Union: MedicareAEI on the HillJanuary 29, 2013Joseph R. Antos, Ph.D.Wilson H. Taylor Scholar in Health Care and Retirement PolicyAmerican Enterprise Institute
  2. 2. Slower Per Capita Medicare Spending in Last 3 Years 6.0% 5.3% 5.0% 4.3% 3.6% 4.0% 2.9% 3.2% 3.0% 1.8% 2.0% 0.9% Medicare 1.0% GDP 0.0% -1.0% 2008 2009 2010 2011 -2.0% -3.0% -4.0% -3.1% Comparable growth rates for total spending and GDP: 8.0% 1.9% 6.9% -2.2% 4.3% 3.8% 6.2% 4.0% Total Medicare spending continues to grow significantly faster than the economy— Is GDP + ½% feasible?AEI 2
  3. 3. 3
  4. 4. Federal spending as a percentage of GDP, Alternative Fiscal Scenario* 18 17.2 16 14 Assumes aging accounts for 52% of 12 growth in health spending and 68% 11.6 in health and Social Security 10 9.6 9.5 7.7 8 6.7 6.2 6 5.0 3.7 3.7 4 1.7 1.4 2 0 Social Security Medicare Medicaid, CHIP, ExchangeOther Spending Interest Deficit 2012 2037 *Assumes Medicare physician fees held at 2012 level, IPAB does not take effect, current law reductions in per-person exchange subsidies notAEI enforced, other automatic spending reductions not enforced. 4
  5. 5.  Better choices for seniors  Better incentives for providers  More effective competition among health plans  Greater security for beneficiaries, today and tomorrowAEI 5
  6. 6.  Simplify and improve Medicare’s benefit ◦ Combine Part A + Part B; single deductible; catastrophic limit  Reform Medigap ◦ Limit first dollar coverage  Promote fair competition ◦ Similar to Part D: Plan bids determine risk-adjusted payment, better information for seniors to choose traditional Medicare or private plan  Reform payment policies ◦ Permanently resolve physician payment  Align eligibility age with longevityAEI 6

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