We can’t wait any longer to reform health care entitlements

With the political split in Washington, you would think prospects for anything serious on the future sustainability of health care would be a long shot. That is very likely so, but there is some hope coming out of the recent national debt limit compromise.

Battling a right-wing insurrection, House Speaker Kevin McCarthy (R-Calif.) plans on proposing a commission to look at the entire budget, including healthcare and other entitlements. In the Senate, a bipartisan group of senators have re-introduced the TRUST Act, which would give a rescue committee 180 days to recommend ways to stabilize various trust funds.

Politicians generally dodge entitlement reform, for fear of being booted at the ballot box by a supposedly unsophisticated electorate susceptible to misleading and inaccurate political ads. But as the Kaiser Family Foundation shows, the public is far more sophisticated than we give voters credit for. The American public is ready for a true debate on healthcare’s future.

Kaiser’s Health Tracking Poll found that the public is very concerned about Medicare’s long-term sustainability but sees the current debate as largely political. Overall, Democrats, independents and Republicans polled had similar views — over 80 percent believe Medicare will not be able to provide the same level of benefits in the future. More than 70 percent think changes need to be made to ensure its future, and almost 80 percent see politics at play in Washington on the issue.

Over 80 percent of those polled view Medicare positively. Interestingly, more than three-quarters view Medicaid positively, including two-thirds of Republicans. About 70 percent think Medicaid is working well and about two-thirds have some connection to or know someone connected to Medicaid.

What do we know about the status of our healthcare programs? Today we spend about 18 percent of our gross domestic product (GDP) on healthcare. That number is forecasted to rise considerably. Medicaid and Medicare will see huge increases in their costs as well; this means that both Medicaid and Medicare will take up ever-increasing shares of the federal and state budgets.

At the same time, we know that both programs are critical to our healthcare future. The number of Medicare recipients is growing, due to the aging demographic. Medicaid will be relied on increasingly as America ages and to reduce the number of uninsured. Today, Medicaid covers almost half of all births in America and financially supports most of long-term care.

Both Medicare and Medicaid must be put on a solid financial footing for the future. There are myriad ideas that Congress and policymakers can take to help Medicare’s long-term stability. They include:

• Means testing the program or having wealthier folks pay more for premiums and cost-sharing
• Looking at the eligibility age
• Refining the Medicare payment system for medical services and drugs
• Re-examining the benefit structure, such as augmenting in some areas and deprioritizing others
• Reining in fraud, waste, and abuse
• Reining in myriad reform pilots in traditional Medicare in hopes of gaining traction on lowering costs and improving quality
• Fostering additional growth in Medicare Advantage as well as a delinking of the rate structure from inefficient traditional fee-for-service
• Enhancing how dual eligible populations are overseen, especially integrating medical and long-term care between Medicare and Medicaid
• Allowing people to opt out of Medicare with a premium subsidy from the federal government that they could take somewhere else to obtain coverage
• Some changes in taxation to balance benefit and other cost savings

Possible reforms in Medicaid include:

• Look at the rich benefit and onerous mandates
• Consider scaled premiums and cost-sharing based on income
• Reform the entitlement nature of the program, with a middle-ground generous and flexible per-capita cap program (sensitive to regional cost, economic, inflationary and other winds)
• Refine federal matching rates, including reimbursing only to a certain level of benefits and income
• Address low provider reimbursement so as to improve network access, establish medical homes, boost quality, and alleviate pressure on the commercial and Medicare worlds
• Institute reasonable personal responsibility measures to change behaviors
• Create a national aging plan, including a buy-in strategy to long-term care services

In the exchanges, we must:

• Ensure the program’s financial stability and stop the political brinksmanship on its future
• Come to some middle-ground accommodation on enhanced premium subsidies, including better help for middle-income earners

Over time, we need to come together to endorse coverage as a social good, as other developed countries do. We should consider one single social-safety net program — anyone without affordable access to employer coverage would receive income-based support in this program. This would reduce inefficiency and fracture in the system and save on administrative costs.

Marc S. Ryan is a veteran health plan and healthcare technology executive. He is author of “The Healthcare Labyrinth.”