Stuart Guterman, assistant vice president and director of the Program on Payment System Reform at the Commonwealth Fund, spoke about "Medicare's evolution” at the Healthcare Financial Management Association’s recent ANI conference in Las Vegas.
"When you're around long enough - you get to see some things," Guterman said, which is a bit of an understatement in his case.
Guterman’s past positions include director of the Office of Research, Development, and Information at the Centers for Medicare and Medicaid Services; senior analyst at the Congressional Budget Office; deputy director of the Medicare Payment Advisory Commission; and chief of institutional studies for the Office of Research at CMS's predecessor, the Health Care Financing Administration.
"Medicare has always been a social and innovation center," Guterman said. When Medicare began in 1965, half of Americans age 65 and older had no health insurance. Medicare was designed to help seniors face unexpected hospital bills. As a by-product, Medicare was responsible for ending racial segregation in American hospitals.
More recently, with the passage of healthcare reform legislation, Medicare will have a new focus, he said, which is to implement innovative ways of lowering chronic care expenses.
Medicare gets a lot of attention, Guterman conceded, but for good reason.
"It has a particularly important place in the minds of lawmakers because it is part of the federal budget,” he said. "Medicare's problems are problems it shares with the rest of the healthcare system."
The biggest problem is that too much money is going out, and not enough money is coming in. Something has to be done, but Americans are uncomfortable with raising taxes or cutting back on healthcare spending, at least when it impacts their own healthcare.
People say 30 percent of Medicare spending is a waste. “But which 30 percent?” Guterman asked.
This is the question that remains to be answered, and is perhaps why Congress has yet to permanently fix the Medicare physician payment formula.
Here’s the short version of Guterman's conclusions: Medicare needs better incentives, better chronic care coordination and better quality of care data. Most of these are under way – or are slated to be addressed – under the Affordable Care Act.
Here's hoping Don Berwick, the newly appointed head of CMS, is caught up on his sleep. He's going to need it.