At issue: America's health-care system

November 1, 2008

Medicare is one of several health-policy decisions that many physicians, including ophthalmologists, hope to see addressed by the next president-elect.

Key Points

Regardless of which presidential candidate America elects to fill the Oval Office, not surprisingly, Medicare is one of several "hot button" health-policy issues that many physicians-including those in ophthalmology-hope to see addressed.

Sen. John McCain (R-AZ) and Sen. Barack Obama (D-IL) generally are in agreement that the next administration should work toward reducing health-care costs, delivering high-quality patient care, placing an increased emphasis on prevention, and providing coverage for an estimated 46 million uninsured Americans.

Moreover, many in the medical community are looking to the next president-elect to inspire systemic changes that will remove the obstacles that hinder quality patient care.

Those five issues-either solo or in combination-adversely are affecting patient care in the United States. The biggest white elephant in the room, Medicare, has garnered little attention from either candidate.

As the nation's 75 million baby boomers begin to reach retirement age in 2010, physicians operating under Medicare find themselves facing steady financial pressure to balance patient care and their ledgers.

Payment cuts

This summer, 600,000 physicians who treat Medicare patients dodged a 10.6% pay cut, which is based on Medicare's cumulative pay formula, the sustainable growth rate (Ophthalmology Times, July 15, 2008, Pages 1 and 10). Under the formula, cuts of about 5% are projected annually over the next few years.

In July, Sen. Obama joined 68 other senators to vote for a bill to prevent the pay cut. A few days later, the Senate voted 70-26 to override President Bush's veto of the measure.

Sen. McCain missed the votes on the Medicare legislation. He will have yet another chance to review the issue when a projected pay reduction of roughly 20% is scheduled for 2010.

The payment cuts likely would have both immediate and long-term effects on access to proper elder health care. According to an MGMA survey released in March, nearly half of more than 1,000 responding practices reported that the 10.6% cut in Medicare physician payments inclined them to stop accepting or limit the number of beneficiaries they accept.

Also, half of the respondents said that they were considering reducing administrative and clinical staff and more than two-thirds indicated they would forgo or postpone investments in health information technology (HIT).

Regina Herzlinger, PhD, is the Nancy R. McPherson Professor of Business Administration Chair at Harvard Business School, Boston, and specializes in health-care issues. During her past 30 years at Harvard, she has seen the number of experienced physicians seeking an MBA to pursue another career grow exponentially.

Although righting the Medicare ship is needed sooner rather than later, Josie R. Williams, MD, said it's too difficult to determine where the subject might rank among the new president's priorities, considering the war in the Middle East and the economic downturn in the United States.

Dr. Williams is president of the 47,000-member Texas Medical Association, the largest state medical group in the nation. Medicare reform does not appear to be a top concern of lawmakers at the moment, according to Dr. Williams.

"I don't think Congress has the political will to deal with [Medicare reform]," she said.

Observers contend that while Medicare has some shortcomings, the overall success of the program is proof that further expansion into universal health-care coverage is the most viable solution for the problem of uninsured Americans.

But, at what cost?

Even with recommended pay cuts for physicians, there is no fiscal silver bullet to cure the long-term ills of Medicare, which will cost an estimated $500 billion to administer this year, said Laurence J. Kotlikoff, PhD, professor of economics, Boston University, who studies health care.

"[The candidates] have no plans to contain the costs of Medicare or Medicaid, which are exploding and will surely bankrupt the country," Dr. Kotlikoff said.

Since the 1960s, spending on health care in the United States has been rising at a faster pace than spending in any other sector. In 2005, national health-care spending amounted to about $2 trillion, or $6,697 per person, and 16% of the gross domestic product (GDP).

According to the New York-based nonprofit Commonwealth Fund, health-care spending, which includes the expense of hospital care, administration of public and private health insurance, and prescription drugs, is expected to double by 2015 to $4 trillion-20% of the GDP.

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