Preserving Medicare: A Practical Approach to Controlling Spending, Coursework Example

Introduction

The privatization of Medicare is a complex process that requires significant consideration and evaluation from a financial perspective. Medicare is a comprehensive federally funded system that requires significant consideration because it continues to cause significant financial concern for the government because it is draining resources significantly across many areas. Therefore, this program must be explored more fully in order to determine how to best overcome its lack of financial stability and its inability to provide a cohesive level of coverage for patients in a cost effective manner. It is important to identify specific areas that will benefit from Medicare expansion and possible privatization in order to alleviate federal spending and subsequent taxpayer dollars to support this program, to also improve the cost efficiency of the program for those who qualify.

Body

Medicare privatization requires a level of commitment that is not always available through private insurers because they may lack the leverage that is required to ensure that spending is reduced for this population group (Berenson & Holahan, 2011). Medicare patients are older adults who typically require increased service levels and therefore, drain the costs of the system on a continuous basis (Afendulis, Landrum, & Chernew, 2012). In this capacity, Medicare in the public sector continues to be a significant burden on the taxpayer in order to fund the system and its millions of participants over the age of 65 (Afendulis et.al, 2012). These issues create considerable strife for the federal government and inspire discussions regarding privatization in order to place much of the financial burden on private organizations and to remove this burden from the government realm and to provide other tools that will privatize this system for older adults who require these services (Afendulis et.al, 2012).

The Affordable Care Act (ACA) has shifted the manner in which many view Medicare and its viability in its current state; therefore, other alternatives must be considered that will have a lasting impact on this program and its utilization by older adults (Afendulis et.al, 2012). For example, the privatization of Medicare must be explored as a viable opportunity to ensure that coverage for seniors is viable with programs such as Medicare Advantage, a private program that bypasses the traditional Medicare offering as provided by the federal government (Cabral, Geruso, & Mahoney, 2014). In this context, it is observed that organizations will continue to explore Medicare alternatives to reduce costs, but that insurers continue to dominate the market and to govern the decisions that are made in the market (Cabral et.al, 2014).

Most importantly, privatizing Medicare requires an effective understanding of the different elements that govern decision-making in this capacity and the ability to overcome specific challenges that dominate the market in many ways. Many experts argue that the privatization of Medicare contributes to new challenges that will limit outcomes potential and will encourage some private insurers to not fund the program over time, depending on its level of utilization (Miller, 2014). Through the movement of customers from traditional Medicare to privatized plans, it is likely that some consumers will experience the brunt of this change and will contribute to a lasting impact on the welfare state when Medicare in a privatized form becomes unaffordable to use (Miller, 2014). As a result, it is necessary to evaluate these circumstances in different ways and to be proactive in supporting a framework that will create new opportunities for success within the current state, given the differences that Medicare plans offer to the affected populations (Miller, 2014). There are considerable challenges related to the development of programs that will have a lasting impact on outcomes and that will essentially govern the welfare state when Medicare privatization becomes even less desirable than the traditional publicly-funded format (Miller, 2014). Organizations must be prepared to handle both sides of the argument and to be effective in sharing their views regarding the state of Medicare and how it might benefit from a change in ownership and funding from the private sector in order to accomplish the expected goals and objectives (Miller, 2014).

Conclusion

For the traditional Medicare system, the burden that it incurs for the federal government is far too significant to ignore and creates even greater challenges for the end users, those who require insurance coverage as a means of survival. In this context, it is important to identify specific areas whereby Medicare in a privatized form might be an effective tool in shaping the direction of healthcare practice for older adults. Nonetheless, the arguments to maintain traditional Medicare as funded by the federal government are many and continue to revolve around maintaining funding for the program at this level but in reducing spending through different programs that will have lasting benefits for the consumer population, and by extension, the traditional taxpayer. These efforts require those who lead the Medicare system to consider other alternatives that will enable the system to remain viable and to also consider other alternatives that will support a viable and lasting impact on operations and utilization for the foreseeable future. Although the strict privatization of Medicare is not on the horizon in the very near future, it is nonetheless a possibility, particularly when there are limited opportunities to fund the current system and to enable it to be viable for the foreseeable future. This is a difficult task to achieve and requires a delicate balance between different interests and funding resources so that the system is able to provide the desired level of service to its customers, both now and for the foreseeable future.

References

Afendulis, C. C., Landrum, M. B., & Chernew, M. E. (2012). The impact of the affordable care act on Medicare advantage plan availability and enrollment. Health services research, 47(6), 2339-2352.

Berenson, R. A., & Holahan, J. (2011). Preserving Medicare: a practical approach to controlling spending. Urban Institute.

Cabral, M., Geruso, M., & Mahoney, N. (2014). Does Privatized Medicare Benefit Patients or Producers? Evidence from the Benefits Improvement and Protection Act.

Miller, K. (2014). Do private Medicare firms have lower costs?.