How to fix the Medicare problem? We reported last week that Medicare Part A is running low on funds. The Medicare Trustees reported that the Medicare hospital insurance trust fund will run out by 2026 and Social Security will become insolvent by 2034. However, Medicare will continue to pay your benefits.
How to fix the Medicare problem?
In light of the recent Medicare Trustees report, what are some ideas to fix Medicare and Social Security? Here are some of the top ideas for how to fix the Medicare problem.
Reduce improper billing
One big way to save Medicare money would be to reduce the billions of wasted dollars incurred with improper billing. In the past five years, Medicare has wasted over $200 billion in tax dollars due to billing errors that could have been prevented. Each year, providers bill Medicare for services that are medically unnecessary, lack documentation, or are improperly coded. Medicare pays 99.5% of claims without reviewing them for accuracy.
In 2009, the Recovery Audit Contractor (RAC) program was launched to review Medicare claims, identify errors, and return funds to Medicare. This program has been scaled back. According to Kristin Walter of The Council for Medicare Integrity, Congress should authorize CMS to review Medicare claims before paying them, and expand the RAC.
Raise Medicare taxes
Another way to “fix” the Medicare problem would be to raise Medicare taxes. This is undoubtedly an unpopular option due to the strain on individuals’ funds. However, it would help the cash flow problem in Medicare.
Another solution to the Medicare problem would be means testing. Means testing would mean evaluating whether someone actually needed Medicare financially based on their income level, and then removing wealthier individuals and couples from Medicare. Alternatively, wealthier Americans could be charged premiums, copays, and deductibles, while other Americans would not.
Allow the government to negotiate drug prices
Trump promised in his presidential campaign to allow the federal government to negotiate drug prices, but his recent blueprint for lowering drug costs does not include this provision. Allowing the government to negotiate price would bring drug prices down, but might also hurt innovation in U.S. drug companies.
Increase virtual medicine
Increasing the use of digital technology and telemedicine to perform virtual doctor visits could save a lot of time and money for both Medicare and its beneficiaries. The downside is that doctors could misdiagnose ailments because they are not seeing the patient in person.
Each possible fix to Medicare comes with its own positives and pitfalls. What are your suggestions for fixing Medicare? Follow us on facebook and let us know your thoughts.