We find that when more seniors enroll in Medicare managed care, hospital costs decline for all seniors and for commercially insured younger populations. Greater managed care penetration is not associated with fewer hospitalizations, but is associated with lower costs and shorter stays per hospitalization. These spillovers are substantial ― offsetting more than 10% of increased payments to Medicare Advantage plans.
NBER paper by Katherine Baicker, Michael Chernew, Jacob Robbins.
Retired as a city worker, Sheila Pugach lives in a modest home on a quiet street in Albuquerque, N.M., and drives an 18-year-old Subaru.
Pugach doesn’t see herself as upper-income by any stretch, but President Barack Obama’s budget would raise her Medicare premiums and those of other comfortably retired seniors, adding to a surcharge that already costs some 2 million beneficiaries hundreds of dollars a year each.
More importantly, due to the creeping effects of inflation, 20 million Medicare beneficiaries would end up paying higher “income related” premiums for their outpatient and prescription coverage over time…
Currently only about 1 in 20 Medicare beneficiaries pays the higher income-based premiums, which start at incomes over $85,000 for individuals and $170,000 for couples. As a reference point, the median or midpoint U.S. household income is about $53,000…
The administration is proposing to extend a freeze on the income brackets at which seniors are liable for the higher premiums until 1 in 4 retirees has to pay. It wouldn’t be the top 5 percent anymore, but the top 25 percent.
This is from the Associated Press.
This is from Bryan Caplan. Full post is worth reading:
If you peruse this table, you’ll discover that total number of new M.D.s per year has been virtually flat for 30 years. During this period, population increased over 30%. As a result, the new M.D./population ratio has declined for decades.
If you’re not horrified, consider that the senior population ― doctors’ best customers ― increased by over 50%. As a result, new M.D.s per senior fell by about a third over the last three decades.
Full post is worth reading. Here are the conclusions:
- Raising Medicare’s retirement age increases the progressivity of government health benefits, and protects minorities ― the opposite of what opponents contend.
- Raising Medicare’s retirement age will significantly reduce federal spending and will also help reduce overall health spending.
- A naked increase of the retirement age would put more seniors on Medicaid, but allowing those seniors to enroll in the exchanges entirely solves that problem.
Between 1996 and 2003, the mean vintage of prescription drugs increased by 6.6 years. This is estimated to have increased life expectancy of elderly Americans by 0.41-0.47 years. This suggests that not less than two-thirds of the 0.6-year increase in the life expectancy of elderly Americans during 1996-2003 was due to the increase in drug vintage. The 1996-2003 increase in drug vintage is also estimated to have increased annual drug expenditure per elderly American by $207, and annual total medical expenditure per elderly American by $218. This implies that the incremental cost-effectiveness ratio (cost per life-year gained) of pharmaceutical innovation was about $12,900.