FREE ESSAY ON HEALTH CARE REFORM

HEALTH CARE REFORM

9:15
Due to the upcoming presidential election, the two major political parties, and their
candidates, have been focusing on the primary problems that the nation will face. Chief
among those problems is the future of Medicare, the national health-insurance plan.
Medicare was enacted in 1965, under the administration of Lyndon B. Johnson, in order to
provide health insurance for retired citizens and the disabled (Ryan). The Medicare
program covers most people aged 65 or older, as well as handicapped people who enroll in
the program, and consists of two health plans: a hospital insurance plan (part A) and a
medical insurance plan (part B) (Marmor 22). Before Medicare, many Americans didn't have
health insurance coverage, but since its inception the program has enrolled almost 40
million beneficiaries, who jointly fund the insurance program along with the national
government (Carnegie). 
According to Dr. Don McCanne, a member of the Board of Directors of Physicians for a
National Health Program, Before the passage of Medicare in 1965, only 52% of persons age
65 and over had hospital insurance and less than 15% had adequate health insurance
(McCanne). The Medicare program has improved access to healthcare and improved the
quality of life for millions of elderly members, and has provided insurance for millions
of persons with disabilities. By reducing the burden of large medical bills, Medicare
also has improved the economic status of the elderly. As Dorothy Price points out Over
its 33 year history, Medicare has channeled billions of dollars into the health care
system, helping to foster enormous improvements in health care technology and medical
education (Carnegie). Unfortunately though, the program is now facing two major problems:
beneficiaries are still having trouble in finding affordable care, and the Medicare
program itself is not properly funded. As a result of these problems, the program could
cease to exist unless a solution is found.
One of the problems of Medicare itself is that it doesn't cover the costs of prescription
drugs for its members; this has led to one of the major reasons that the program is in
danger. A great deal of personal healthcare relies on the use of drugs, and since the
program doesn't cover these costs, the individual must bear them. According to the AARP,
in 1999 out-of-pocket costs for prescription drugs were estimated to be $450 per person
each year (AARP). Obviously, members have joined the program to defray their medical
costs, but these figures indicate that they still have large costs to pay. The other
problem faced by the Medicare program is that it is also suffering from a lack of funds.
According to Governor George W. Bush, the financial health of Medicare is in serious
jeopardy and might face deficit as soon as 2010 (Bush). As a result of these major
problems, one might wonder why the plan isn't scrapped for another program; well
according to polls done by the Public Agenda, an Internet public policy site, American
citizens are strongly in favor of Medicare, and would rather see the problems ironed out
(Public Agenda). Therefore it is necessary to come up with a solution, so that the
Medicare program remains intact.
The most favorable solution for these problems is for the national government to
alleviate the out-of-pocket costs (such as the costs for drugs) of the beneficiaries by
funding the Medicare program through the use of the national budget surplus. As of now,
funding for Medicare has been provided through payroll taxes and social security taxes
paid by enrolled members and their employers, and also through general revenues provided
by the government. In fact, statistics provided by the United States Senate and Senator
William Frist (R-Tenn.) indicate that Medicare members fund 25% (about $45/month), and
the government covers the other 75% of Medicare costs (Frist). However, using revenue
from the budget surplus would take the pressure off the beneficiaries and the government
as well, by steadily lowering payroll and social security taxes. 
Another important reason that makes this proposal worthy is the fact that the national
budget surplus will continue to increase beyond 2010. In fact, according to George W.
Bush, the budget surplus is expected to grow well past $5 trillion over the next 10 years
(Bush). Considering the fact that Medicare expenditures project to cost around $452.2
billion over that same period (Bush), there will be plenty of money still available for
military, education, and other government expenditures. Obviously, if the budget surplus
were to decrease or remain stagnant over this time, it would be very costly to maintain
Medicare under this proposal, but due to the budget's optimistic (to say the least)
outlook, the proposal is very sensible and effective.
Perhaps the only other alternative to Medicare itself would be for the government to
adopt a centralized form of healthcare, similar to the one employed in Canada. In that
program, every citizen would be entitled to the same benefits regardless of age,
disability, or unemployment. Although this program seems like it would be for the best,
it would take many years to implement the system. Legislation for a major issue such as
healthcare normally spans several years (Frist), and is one reason that the government
and neither party has ever brought the idea to the forefront. Furthermore, the financing
for a public healthcare plan would shift more to the people since the government would be
realizing all of the costs. Although still in use in Canada, the public healthcare system
caused quite a scandal in the late 1980's in the province of Alberta. In order to make up
for the enormous costs accrued by the program, restrictions were placed on the amount of
drugs that were to be prescribed by physicians (Marmor 97). This raised many concerns
over the program and its lack of medical ethics. In fact, many organizations in Canada
have formed coalitions to prevent incidents like this from occurring. One such coalition,
the Friends of Medicare, was instrumental in helping pass the Canada Health Act in 1994
(Marmor). The Act is designed to ensure that Canadians receive comprehensive medical care
at no cost.
As mentioned earlier, most Americans would rather see the Medicare program revamped
instead of replaced. One of the measures that the government took was the establishment
of the Medicare HMO (health maintenance organization). This program was designed to allow
HMO subscribers the ability to use any hospital or physician. Previously, patients who
contracted with HMOs were only allowed to use hospitals and physicians under contract
with that HMO provider (Marmor 192). As a result, many people feared that HMO's were more
worried about money, then the health of its subscriber. With the advent of Medicare HMO,
many more people subscribed to different providers. According to the Medicare HMO
Internet site, the total membership of HMO's has risen to over 7 million people as a
result of its partnership with the Medicare program (MCOL). The problem with the HMO is
that it is an even more private form of healthcare insurance then Medicare, and therefore
costs more to the individual. Whereas much of the spending for Medicare is provided by
payroll taxes, many employers do not even contract with health maintenance organizations
due to cost (Ryan). Therefore, subscribers must pay more in premiums each month, then the
estimated $45 monthly Medicare charge.
By using revenue from the budget surplus to cover Medicare costs, the national government
would be benefiting itself, as well as Medicare subscribers. As previously mentioned,
payroll taxes and social security taxes, current sources for Medicare funding, would be
considerably lower and more elderly and disabled persons would be able to enroll in the
program. The money from the budget surplus would be used primarily for out-of-pocket
expenditures, such as prescription drug costs, as wells as to finance hospitals and
medical technology. The government would benefit because of a stable national
health-insurance plan, and due to a rapidly increasing budget surplus which figures to
increase well over $5 trillion over the next ten years. This allows the government to
take care of other major problems areas such as education, crime, and the armed forces.
Although there are other alternatives such as switching to a more centralized form of
medical care or relying on a more private form of medical care, each has several
important problems. The time spent on legislation dealing with a public healthcare
system, combined with moral aspects of the system make it less appealing. Likewise, added
costs and insurance premiums for individuals, and the heavier financial burden on the
government make the private system less desirable as well. Based on these facts, the best
solution would be to reform the Medicare program through budget surplus financing.
Annotated Works Cited
AARP On Medicare Reform. AARP.org 3 March 2000. 21 October 2000
*http://www.aarp.org/election2000/medicare.html*. In this article, the AARP
(Association for the Advancement of Retired Persons) documents the history of
Medicare, and its success providing healthcare insurance to the elderly. However, 
the article also points out some of the problems that the program causes; for instance,
many of the program's beneficiaries must pay large out-of-pocket 
expenditures in addition to the monthly premiums they are charged.
Bush, George W. A Defining American Promise. georgewbush.com 15 May 2000.
20 October 2000 *http://www.georgewbush.com/News.asp?FormMode=SP
&ID=3. Presidential candidate George W. Bush outlines his agenda on the issues
of economic security and medical care for the elderly. If elected, Governor Bush
will not hesitate to use revenue from the national budget surplus to support social
security and Medicare reform. 
Carnegie, Wilson. Altman Discusses Medicare Problems. BrownDailyHerald.com 
6 December 1999. 22 October 2000 *http://www.browndailyherald.com/stories.
Cfm?S=O&ID=868*. This newspaper article featured an article with Stuart 
Altman, a professor of national healthy policy at Brandeis University. In it, 
Altman discusses the nation's need for proper Medicare funding. Currently, the 
Program is jointly funded by tax dollars and government revenue, but is in 
jeopardy of running a deficit in the future.
Frist, William R. Who is Eligible. Senate.gov 26 January 1998. 21 October 2000
*http://www.senate.gov/~frist/show_med/sld018.htm*. Senator William
Frist of Tennessee presents a slide show explaining how the Medicare program
Works. Frist describes the two parts of the Medicare plan, and also explains
who is eligible to enroll in Medicare. Furthermore, Frist discusses how Medicare
is funded, and the roles of various commissions in health care reform.
Marmor, Theodore. Understanding Health Care Reform. New Haven: Yale Univ. Pr,
1994. Theodore Marmor discusses the debate over President Clinton's health care 
reform bill, and its alternatives. He explains what we can and can't expect from the
bill, and also analyzes some proposed solutions regarding healthcare costs.
Marmor is a professor at Yale University, and has been called on by Congress several
times for policy proposals and debate. He is considered an expert on health care reform.
McCanne, Dr. Don. Rebuilding Medicare for the 21st Century. Medicare4All.org
11 February 2000. 21 October 2000 *http://www.medicare4all.org/report/med
4.html*. Dr. Don McCanne, a member of the Board of Directors of the
Physicians for a National Health Program, credits Medicare for giving millions
of elderly and disabled persons medical insurance coverage. However, he also
points out that the program is seriously under funded, and faces deficit problems
in the future. In McCanne's opinion, government funding is the best way to 
alleviate the rising costs of Medicare.