Tough Lawmaker Resolve Needed To Revamp The Medicare System

Armen Hareyan's picture

It has been 43 years since Medicare was signed into law by President Lyndon B. Johnson. Latest figures show that Medicare currently provides health care for 44 million seniors in the United States and the number is expected to grow sharply in the next coming years.

Whereas Medicare has done a great deal in helping the elderly Americans, the current conditions and principles behind Medicare have to be reviewed if America is not to backtrack on its commitment to providing health insurance to its seniors.

It’s now that bipartisan action is needed if Congress wants American workers not to suffer financial consequences of paying for the ever increasing costs of providing Medicare.

Recent figures show that Medicare spending has increased sharply in the last two years and there has been numerous talks directed at congress urging them to act first on the Medicare Issue before the problem matures. However, congress seems adamant and refuses to acknowledge that Medicare current woes need to be addressed sooner than later.

Last week, Congress again followed the trend they set back in February when they ignored a legislation sent to congress by president bush that attempted to address some of Medicare's troubles. In fact, Congress last week voted to ignore the very law that requires it to address Medicare solvency.


There is no doubt that the next generation will have to suffer the consequences by accepting financial liability. The health-care costs per beneficiary are increasing each day and yet the numbers of workers to support each beneficiary are decreasing each year.

For instance, the average cost per Medicare beneficiary has increased 16.6 times from 1970 to date. Figures show spending has increased from $40 billion in 1970 to $467 billion in 2008.Compared to other health costs, Medicare has quadrupled as a percentage of GDP whereas the other health costs have doubled as a percentage of GDP.

It even gets worse, household health care spending is expected to double in the next 20 years from 23 percent of total compensation to about 41 percent. It is expected that federal spending on Medicare will double from 13 percent to almost 23 percent which shows that the US will be spending even more on Medicare than on national defense.

The numbers of workers to pay for each beneficiary are dwindling with figures showing a reduction from four workers per beneficiary in 1970 to about three per beneficiary these days.

Congress needs to find ways of replacing replace volume of care with value of care and also make Medicare Parts A and B operate more like the Medicare Part D prescription drug benefit. It’s also very unfair to transfer the burden of one generation to the next.

Whatever the circumstances, all Americans must work together to see that this looming trouble is tackled at its infancy.