Thursday, March 18, 2010

A Reality of Medicare

In one of my classes, the professor told us that one of the big reasons Medicare is so expensive is because it's set up to cover the sickest population. Think about it, Medicare covers people 65+, the disabled, and it even pays for some odd healthcare-related costs like residency training programs (thank you for that, by the way). Therefore, it makes a lot of sense that Medicare wouldn't be a beacon of cheap healthcare. And yet I always hear people saying that Medicare is ridiculously expensive, wasteful, and prone to abuse that can waste millions or billions or zillions of dollars! I'm hoping that over the next few days, I can address some of these concerns.

According to a 2009 report by the Centers for Medicare and Medicaid Services, Medicare covered 45.2 million people in 2008: 37.8 million 65+ and 7.4 million disabled. This cost $468 million. Yes, Medicare costs a lot, but it's also covering a higher risk population that deals with a higher incidence of high cost conditions like diabetes, hypertension, cancer, Alzheimer's Disease, etc.

I'm curious as to how Medicare's efficiency in covering a higher risk population compares to other countries with national healthcare coverage similar to that of Medicare.  Do European countries cover a similarly high-risk population at a comparable cost, or do they spend much more or much less in doing so? Initial searches brought up precisely bupkis on the matter, but I'm hoping I can find some more information about this in the near future.

Politicians love to point out how much Medicare costs and how costs are so out of control, but considering Medicare covers a population that's at greater risk for higher cost conditions, does Medicare really cost much more than it should be expected to?  I don't know, but if I find any information that sheds light on this subject, I'll be sure to let you know.  In the meantime, if you hear a politician or someone in the media bitching about how much Medicare costs, keep in mind that its high cost is largely due to the population it was set up to cover!

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