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Why Were Changes to Medicare Deemed Necessary

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In November 2003 the U.S. Congress passed a controversial health policy bill that President George W. Bush signed into law. The new legislation makes the most far-reaching changes to Medicare since the program was created in 1965. Please address the following questions:

- Why were changes to Medicare deemed necessary?
- What are the main provisions of the new legislation? Do you think they accomplish the desired goals?
-Who was involved in setting the agenda for this policy change? Discuss the roles and interests of specific agenda setters and their influence on the development of the legislation.
- Why was the legislation controversial? Discuss the claims of the law's supporters and detractors. Who will benefit from the changes?

Do you think having electronically stored data (such as costs and access to ndividual patient files) played a role in the decision-making process?

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Solution Preview

See the links at the end of this response for starters.

1. Why were changes to Medicare deemed necessary?

The changes to Medicare were deemed necessary for several reasons.

a. Rising costs predicted to bankrupt the present system. The steady rise in reported costs due to technology and an aging population deemed it necessary to make changes to Medicare.

b. Health care benefits were a hot issue in labor negotiations, and it has put pressure on Congress to reach agreement on adding a drug benefit to Medicare. Therefore, it was about the changing demographic of the health care consumers, with the aging population. This is because the aging population means a greater strain on the health care system in terms of both cost and capacity. However, the government points out that is more about providing the seniors with a choice of drug plans versus pushing them out of the system. For example, one reporter says this:

This past week, the Trojan Horse galloped off the pages of ancient mythology and into the United States Congress, in the form of a deeply flawed Medicare bill. Congressional Republicans, unable to succeed in past efforts to cause Medicare to "wither on the vine," in the words of Newt Gingrich, were finally able to pass legislation that may spell the end of the entire Medicare program. How did they do it? By concealing it inside a long-overdue measure to provide America's 41 million seniors with prescription drug coverage. (Source: http://dodd.senate.gov/index.php?q=node/3298).

c. Need for a more flexible system. Argued that the need for a new modern Medicare system is about putting patients and doctors in charge of the Medicare system (Bush). In other words, it was about having a more flexible system, where the providers and consumers have more choices in how they receive their care and the new types of treatment that modern medicine offers: drug therapies, new medical devices, disease screening, and preventative care. It is also about providing equal access to these advantages for all seniors and disabled citizens on Medicare (Source: http://www.whitehouse.gov/news/releases/2003/03/20030304-5.html).

d. Need a new Medicare system to address the increased number of uninsured Americans. For example, a new Medicare system would address the increased number of uninsured Americans through various tax credits and other measures (Source: http://www.tommydouglas.ca/articles/articles-aug03.htm).

2. What are the main provisions of the new legislation? Do you think they accomplish the desired goals?

The entitlement for prescription drugs is the biggest change, through tax breaks and subsidies. Since Medicare's creation in 1965, the role of prescription drugs in U.S. patient care has significantly increased. Although increased drug therapy could have to do with the aging population, perhaps it is the pharmaceutical companies that are really in control and reaping in the financial benefits at the expense of our Seniors. It is argued that as new and expensive drugs have come into use, patients, particularly senior citizens for whom Medicare was designed, have found prescriptions harder to afford. The Medicare Prescription Drug, Improvement, and Modernization Act (MMA), is meant to address this problem (Source: http://en.wikipedia.org/wiki/Medicare_Prescription_Drug,_Improvement,_and_Modernization_Act).

The main provisions are:

- Prescription drug coverage that enables seniors to get the medicines they need, without the government dictating their drug choices.
- Choice of an individual health care plan that best fits their needs-just like Members of Congress and other federal employees enjoy.
- Choice of the doctor, hospital, or place they want for the treatment and care they need.
- Full coverage for disease prevention such as screenings for cancer, diabetes and osteoporosis.
- Protection from high out-of-pocket costs that threaten to rob seniors of their savings. (President Bush, http://www.whitehouse.gov/news/releases/2003/03/20030304-5.html for further details).

Were these goals accomplished or is it still too soon to tell? This part calls for your personal opinion. It seems that most of them were addressed although perhaps not in full.

From another source:

The complex legislation also changed Medicare (supporters) in the following ways:

- it mandates a six-city trial of a partly-privatized Medicare system (by 2010);
- it gives an extra $25 billion to rural hospitals (at the request of congressional representatives in the rural West);
- it requires higher fees from wealthier seniors; and
- it adds a pretax health savings account for ...

Solution Summary

This solution responds to questions of medicare e.g. why the changes to Medicare deemed necessary, legislation, why was it controversial, etc. It looks at both sides of the controversy in depth. It also discusses how having electronically stored data (such as costs and access to individual patient files) played a role in the decision-making process.

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