Managing Quality Improvement in Managed Care

The health sector has always been recognized as one of the most
fundamental pillars to the growth and stability of any nation. Indeed,
an enormous chunk of many countries’ budget is dedicated to enhancing
the quality of health in the country as it is well acknowledged that
health determines the wealth-creating capacity and productivity of the
country as only healthy people would be able to create wealth.
Unfortunately, healthcare costs have been increasing year-in year-out
thereby decreasing its affordability to a large number of people
(Colamery, 2003). This was the basis for the crafting of the managed
healthcare, which outlines varied techniques that are aimed at lowering
the cost of offering health benefits and enhancing the quality of care
for organization that make use of those managed care techniques, or even
provide them as services to other institutions, or even describe the
systems of delivering and financing healthcare to enrollees that are
organized around the techniques and concepts of managed care (Pipes,
2010). While varied managed care strategies have been devised in the
past, none comes out as more conspicuous than Medicare. Nevertheless,
the sustainability of Medicare has been jeopardized by varied forces, in
which case only comprehensive strategies would ensure it survives.
Medicare outlines a national social insurance program that is under the
administration of the Federal Government, guaranteeing health insurance
access for individuals above 65-years of age or younger people who have
disabilities or end stage renal disease (Marmor, 2000). In essence, the
program spreads the financial risk that comes with illness so as to
protect all people, in which case it comes with a relatively different
social role from that of for-profit insurers that manage their risk
portfolio through making adjustments to their pricing in line with the
perceived risks (Russell & Cohn, 2012). Recent times have, however, seen
an increase in the controversy surrounding Medicare especially with
regard to its sustainability in the long-term. As a percentage of the
Gross Domestic Product, it is projected that the expenditure on Medicare
will increase to 6.73% by 2086 up from 3.67 per cent in 2011. When
expressed as a proportion of the total federal spending, Medicare was
15.1 per cent in 2010, while economists projected that the proportion
would increase to 17.4 per cent in 2020 (Matthews & Berman, 2010).
Needless to say, this is extremely unsustainable especially considering
other programs such as Medicaid represented about 8 percent in 2010,
almost a half of what Medicare took up (Matthews & Berman, 2010).
The unsustainability of Medicare can be contrasted with that of
Medicaid, Obamacare and even Social Security. Scholars have underlined
the difficulty of fixing Medicare noting that deficits in Social
Security trust funds may be offset through gradual increase in the
retirement age of future generations, altering the path for growth of
benefits from an index that is based on growth of wage to one that is
based on the growth of price, as well as means-testing benefits (Turner,
2011). On the same note, Medicaid has had its growth in varied states
successfully lowered through competition and personal accounts. However,
the same cannot be said of Medicare, which in case the projected cuts in
Medicare as outlined in Affordable Care Act are implemented (something
that may never happen at least going by history), Medicare expenditures
would be increasing from 3.7% of GDP in 2012 to about 7.7% in 2050, and
10% by 2080. Spending cuts, however, would lower this proportion to 6.7%
of the gross domestic product by 2080 (Matthews & Berman, 2010).
On the same note, Medicare has found itself on the receiving end in
instances where there are political punches to be made, with its
revenues being plundered and channeled to other sources (Russell & Cohn,
2012). As at 1st January 2013, Medicare tax, under Affordable Care Act,
was to be imposed on capital and income, an action that would result in
a decrease in investment and incentives to work (Russell & Cohn, 2012).
On the same note, singles who make more than $200k and joint filers
making more than $250k would have their Medicare tax increasing from
1.45% to 2.35%, not to mention that they would be remitting a new 3.8%
on any unearned income (Russell & Cohn, 2012). However, the surprising
bit is that the increased receipts would not be used in shoring up
Medicare and ensuring its sustainability in the future, rather they
would be used in paying for health insurance subsidies for individuals
that are below 400% of the country’s poverty line (Pipes, 2010). On
the same note, the next decade will see “savings” of up to $500
billion, which will not be spent in enhancing Medicare but on a new
program. Testament to this action is the fact that rather than enhancing
the success and solvency of Medicare for present day’s over 50 million
beneficiaries, as well as future generations, a total of $716 billion
has been diverted from the Medicare and channeled to the financing of
single largest expansion project for Medicaid in the history, not to
mention the creation of another entitlement program (Pipes, 2010).
Researchers have noted that the $716 billion channeled from Medicare
could worsen the existing challenges for beneficiaries especially with
regard to access to health care providers of their choice (Russell &
Cohn, 2012). On the same note, they note that the raid would result in
the weakening of private Medicare options including the Medicare
Advantage program that today covers over 14 million Americans.
Meanwhile, reimbursements pertaining to Medicare are considerably lower
than a large number of insurance plans, a situation that sees a large
number of doctors refuse to offer their services to Medicare patients.
In some cases, Medicare patients have to combat with long waits for
appointments with doctors, as well as shortages in doctors (Pipes,
2010). Physicians and doctors note that with the potential reductions in
the rates of Medicare reimbursements, there is no logic or incentive in
catering for Medicare patients. On the same note, a large number of
private insurance companies calculate the rates of reimbursements from
Medicare, in which case they will decrease as well (Turner, 2011). In
addition, healthcare professionals note that the Medicare guidelines and
policies are completely flawed. They note that the new guidelines
require that the doctors are paid on the basis of outcomes, in which
case his incentive will lie in focusing on patients that are healthy
while excluding the sick ones (Colamery, 2003). On the same note,
Medicare uses the number of patients that a doctor sees as a measure, in
which case seeing a large number of patients leaves the doctor with
reduced time to serve the existing patients (Turner, 2011). In case he
or she causes a medical error as a result of rushing through too many
patients in a single day, the physician is not provided with any
protection by Medicaid against lawsuits.
Needless to say, the current structure of the Medicare program is not
only unsustainable in the long-term and short-term but it also threatens
the health security of the current beneficiaries. Scholars have outlined
the importance of allowing for an increase in the plan options that are
offered under Medicare program providing seniors with the same Medicare
benefits that they are currently receiving, while lowering the costs and
enhancing the quality of healthcare (Turner, 2011). In enhancing the
quality of Medicare, it is imperative that short-term, measured steps
are taken to strengthen Medicare through concentrating on policies that
incorporate long-standing bipartisan support from varied economists,
health experts and policymakers.
First, it is imperative that the Medicare physician payment system
undergoes an overhaul so as to allow seniors to see the doctor of their
choice. Indeed, scholars have stated that a fundamental step in
enhancing the quality and sustainability of Medicare for beneficiaries
would revolve around eliminating the uncertainty that emanates from the
Sustainable Growth Rate (SGR) formula used in calculating Medicare
physician payments (Pipes, 2010). There has been continued uncertainty
for more than a decade as congress averts draconian reductions in
Medicare payment that have resulted from the outdated and immensely
flawed SGR formula. Indeed, this is one the key reasons as to why
physicians have been declining to take Medicare patients (Kronenfeld,
2011). This underlines the importance of scrapping off the SGR and
having it replaced with a reform that is fiscally responsible pertaining
to the physician payment of Medicare that allows the elderly and
individuals with disabilities to see their own doctors using the
Medicare cards (Colamery, 2003).
In addition, it is imperative that the transition into Medicare is
smoothened as much as possible. Beneficiaries have had immense anxiety
and confusion due to the structures of the varied components of Medicare
(Kronenfeld, 2011). The division pitting Medicare Part A or Hospital
Insurance and Part B (Medical Insurance) is a reflection of an outdated
health insurance system, with a large number of Americans being
unfamiliar with the system. In essence, it is imperative that seniors
are not provided with an outdated health insurance product since they
are not offered outdated healthcare services (Kronenfeld, 2011). It is
proposed that a contemporary insurance design is provided through
streamlining the cost-sharing structure of the program. In this regard,
Medicare parts A & B’s deductibles would be streamlined, thereby
eliminating the necessity for supplemental coverage thereby simplifying
the healthcare coverage.
In addition, it is imperative that subsidies for high-income earners
are reduced so as to enhance the sustainability and solvency of the
program. Needless to say, Medicare programs make up a significant part
of retirement security. However, it is undeniable that the program is
moving towards insolvency if no improvements are done. In this case, it
is imperative that policymakers examine the effects of the present-day
means testing framework on seniors, as well as determine whether extra
steps should be taken so as to concentrate resources on seniors that
have the greatest need, as well as re-evaluate the voluntary nature of
the program so as to determine the possibility of extra flexibility.
On the same note, the sickest beneficiaries must be protected from
bankruptcy in case of enormous out-of pocket charges. Scholars have
noted that Medicare comes with unpredictable out-of-pocket costs that,
when combined with the fear or experience of the unlimited medical
charges (Kronenfeld, 2011). Indeed, the confusion and fear may be
eliminated by limiting Medicare expenditure thereby protecting seniors
from bankruptcy as the cost of healthcare remains uncertain.
In addition, waste, fraud and abuse should be eliminated to as to
safeguard the Medicare dollar and allow it to enhance its sustainability
and reach the people that it was aimed to reach. Scholars note that in a
large number of occasions Medicare financial resources are lost as the
federal government refuses to take steps that would ensure that the
funds are not abused, wasted on unnecessary projects. As much as the
congress has always outlined its efforts to eliminate wastage, fraud and
abuse, there has been little effectiveness especially considering that
the problem still exists.
Of particular concern is the sustainability of the Medicare and its
solvency in the long-term. This, however, can be solved through ensuring
that any funds that are derived from the program should be used in
enhancing the quality and effectiveness of Medicare rather than having
the funds finance other projects that may not even be closely related to
Medicare. It is noteworthy that such an effort would ensure that the
sustainability of the program is enhanced by about nine years, thereby
allowing for the coverage of all Americans as they enter into the
category of senior citizens.
Lastly, it is imperative that the medical liability system is reformed
so as to eliminate the numerous cases that face medical practitioners
and physicians. Scholars have always underlined the rotten and broken
nature of the medical liability system of the United States. Indeed,
this has resulted in the prevention of the capacity of the patient to
access healthcare and imposed enormous costs on consumers, alongside the
United States’ federal healthcare programs such as Medicare
(Oberlander, 2003). It is worth noting that the broken medical liability
system has resulted in an exodus of a large number of doctors from the
practice, which has resulted in a large number of sites of care closing
down, including a large number of the trauma centers in the country
(Oberlander, 2003). Indeed, the medical liability system seems to
conflict the provisions of the guideline. Not only are doctors evaluated
on the basis of the number of patients that they can see in a single day
but they are also not protected from lawsuits in case of a medical
liability (Matthews & Berman, 2010). All the rushing and the tiredness
would undoubtedly increase the stress level and the likelihood that the
physician would make a mistake. This can only be remedied through a
complete overhaul of the medical liability system or at least protect
the physicians and doctors from litigation (Matthews & Berman, 2010). In
this regard, it is imperative that a comprehensive or all-inclusive
medical liability reform with regard to the federal healthcare programs
is enacted in line with the federal health care programs that would
enhance the seniors’ access to quality while lowering the cost of
Medicare (Oberlander, 2003).
In conclusion, healthcare has been considered as one of the fundamental
pillars of the nation especially considering its connection with the
economic health of the nation. This explains the increased financial
investment of many governments to the healthcare sector. However, there
has been an increase in the cost of healthcare, which governments have
strived to control through managed care programs such as Medicare. While
Medicare has been quite effective, there has been questions as to its
sustainability. This is especially considering its increasing costs with
scholars noting that as a percentage of the Gross Domestic Product, it
is projected that the expenditure on Medicare will increase to 6.73% by
2086 up from 3.67 per cent in 2011. In case the projected cuts in
Medicare as outlined in Affordable Care Act are implemented (something
that may never happen at least going by history), Medicare expenditures
would be increasing from 3.7% of GDP in 2012 to about 7.7% in 2050, and
10% by 2080. Spending cuts, however, would lower this proportion to 6.7%
of the gross domestic product by 2080. In addition, its resources and
funds saved have always been channeled to other programs thereby
affecting the sustainability of the Medicare. For example, as at 1st
January 2013, Medicare tax, under Affordable Care Act, was imposed on
capital and income, an action that would result in a decrease in
investment and incentives to work. On the same note, singles who make
more than $200k and joint filers making more than $250k would have their
Medicare tax increasing from 1.45% to 2.35%, not to mention that they
would be remitting a new 3.8% on any unearned income. However, the
surprising bit is that the increased receipts would not be used in
shoring up Medicare and ensuring its sustainability in the future,
rather they would be used in paying for health insurance subsidies for
individuals that are below 400% of the country’s poverty line (Marmor,
2000). However, sustainability of the Medicare would necessitate
comprehensive strategies that would eliminate the bottlenecks to its
applicability in the healthcare sector. These include medical liability
systems overhaul, reforming the payment systems of Medicare, and
ensuring that the funds made in or saved in Medicare are not channeled
to other programs rather they are used in enhancing the quality of
Medicare.
References
Colamery, S. N. (2003). Medicare: Current issues and background. New
York: Nova Science Pub.
Kronenfeld, J. J. (2011). Medicare. Santa Barbara, Calif: Greenwood.
Oberlander, J. (2003). Medicare and American politics: A fractured
consensus. Chicago: University of Chicago Press.
Matthews, J. L., & Berman, D. M. (2010). Social security, medicare &
government pensions: Get the most out of your retirement & medical
benefits. Berkeley, Calif: Nolo.
Marmor, T. R. (2000). The politics of medicare. New York: Aldine de
Gruyter.
Turner, G.-M. (2011). Why Obamacare is wrong for America: How the new
health care law drives up costs, puts government in charge of your
decisions, and threatens your constitutional rights. New York:
Broadside.
Pipes, S. (2010). The truth about Obamacare. Washington, DC: Regnery
Pub.
Russell, J & Cohn, R (2012). Patient protection and affordable care act.
S.l.: Book On Demand Ltd.
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