Tuesday, September 16, 2014

Issue 419 Combine Medicare A and C September 16, 2014



Similar to yesterday’s article there can be savings by fusing Parts A and C of Medicare.  Part A deals with hospital visits and other aspects of doctor visits.  Medicare part C does similar but resembles part D in how it teams up with private companies to aid in providing health insurance coverage (albeit not in the same way).  But there is merit to reform and Ill discuss that here.

The Idea:  Part C (while cost efficient) of Medicare can be altered to work in the exact same manner as part D with little effort for better savings potential.  This will provide cost savings across the board.  Part A can then be fused into Part C so as to save money without burdening the system, but with a difference.  Part A health coverage is the only part of Medicare that is paid for using our contributions from the taxes we pay toward Medicare.  Parts B, C and D do not have any contributions from the payroll tax (our contributions) that we pay throughout our life to fund Medicare Part A and Social Security.  So the major advantage of combining these in the system is that our own money which we contributed can actually be used to provide coverage for ourselves using part C modified to work more efficiently like part D.

Impact:  With money from part A benefits (our contributions) the government will not be over budget with respect to trying to provide health coverage as the money we contributed will already be there to pay for it with the government only stepping in when the amount of contributions goes down too much that it cannot meet demand.  However, by using the part C model to replace the original part A that possibility becomes a lot less likely.  As such, Medicare will be saved from self-destruction and we will not have to pay premiums (with certain exceptions to the rich) to get coverage for doctors’ visits or emergency room treatment.


Conclusion:  This idea is cheaper and more effective than yesterday’s idea as it uses the contributions we already pay into the system rather than it being budgeted like the current parts B, C, and D of Medicare.  The government will hence save money and we will get cheaper health in the long run.

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