Last week, Democratic presidential candidate Hillary Clinton made a surprising tweak to her position on healthcare.
After arguing that the Medicare-for-all plan outlined by fellow Democratic candidate Bernie Sanders "just doesn't add up," Clinton took a definitive step in his direction. While stopping short of a Medicare-for-all policy, she advocated for a smaller expansion, allowing individuals to buy into Medicare starting at 50 or 55.
The "Medicare-for-more" policy--as it's referred to by the New York Times--was originally proposed by Bill Clinton in a 1998 State of the Union address. It regained traction in 2009 as Democrats and Republicans were squaring off over what would become the Affordable Care Act. Originally, the law included a public option--government-run insurance plans that were offered on the exchanges (a policy that Clinton has also endorsed).
When the public option faltered, Democrats pushed for Medicare buy-in, but that was also left on the cutting room floor.
Support for Sanders--who has vowed to remain in the race despite trailing significantly--has probably nudged Clinton in this direction. But it's also not a wildly unpopular idea. According to a poll of likely 2016 voters conducted in January 2015 by the Progressive Change Institute, 71 percent of respondents were supportive of a Medicare buy-in program.
Proponents of a buy-in program have argued that Medicare's purchasing power would drive down healthcare costs, which would translate to lower premiums for consumers and increased competition among private insurers. Opponents argue providers would bear the financial brunt of the policy by absorbing a sizeable paycut.
Lost in these policy discussions is whether or not Medicare could adequately handle a sizeable expansion when the program's improper payment rate sits at more than 12 percent.
The government has a long history of demonstrating its inability to limit improper payments in nearly all its healthcare programs, but Medicare has been particularly burdensome. The Government Accountability Office (GAO) has included Medicare on its list of programs at risk for more than 25 years. In 2015, Medicare Fee for Service was responsible for $43 billion in improper payments, up 43 percent since 2010. Add in Medicare Advantage and Medicare Part D, and that amount jumps to nearly $60 billion.
This week an audit of the HHS showed that CMS failed to get Medicare improper payment rates under its target of 10 percent--a target that some might argue is woefully inadequate in and of itself. In its other healthcare programs--Medicare Advantage, Medicaid, and the Children's Health Insurance Program (CHIP)--HHS exceeded its target improper payment rate by more than three percentage points in some cases.
In certain industries, like durable medical equipment and home health, more than half of claims are improper.
At times, the Centers for Medicare and Medicaid Services has struggled to implement even the most basic interventions, such as removing Social Security Numbers from Medicare cards, a GAO recommendation since 2004. Furthermore, CMS has been slow to adopt automated prepayment edits that could prevent billions of payments from going out the door, and struggled to organize data in a way that could streamline post-payment reviews.
Presumably, adding a new cohort of beneficiaries through a Medicare buy in program would place additional strain on the system that is already audibly creaking under the existing pressure.
All of this doesn't necessarily elminate a Medicare-for-more program from consideration, particularly as policy makers are searching for ways to cover the remaining uninsured population. Rather--and I know this is reaching--there should be a concurrent discussion about how to provide CMS with the resources necessary to effectively manage its current improper payment rate.
It's possible to have the best of both worlds--to expand the Medicare program while also controlling unnecessary costs. But it requires a distinct shift away from the government's traditionally passive approach, in which fraud, waste, and abuse interventions are merely an afterthought. - Evan (@HealthPayer)