How Does Medicare and Medicaid Differ? Please Provide Three Main Points. What Changers in Each Would You Recommend to Improve the Outcomes of Their Original Missions?
Medicaid and Medicare are two different programs run by the government. Both programs were created in the year 1965 to respond to the inability of low-income and older Americans to purchase private health insurance (Holahan & McMorrow, 2012). The two programs were part of President Lyndon vision of a general social commitment to meeting the needs of individuals’ health care. Therefore, Medicaid and Medicare are social insurance programs that allow the financial burdens of sickness to be shared among the sick and healthy individuals, as well as among the low-income and the affluent families. However, both programs differ in dimensions and structures.
To begin with, Medicare is a federal insurance program while Medicaid is a state and federal finance program (Holahan & McMorrow, 2012). Since Medicare is run by the federal government, the rules and regulations governing eligibility and the kind of services offered are similar across all states. Given that Medicaid program is run jointly by the state and the federal government, eligibility requirements, rules, and regulations vary depending on the state where one lives. In Medicaid program, the federal government only sets the minimum threshold and each state establishes its own rules such as eligibility, payment, duration, among other legislations.
Eligibility for both programs differs depending on the income, age, and physical conditions of an individual. Medicaid is a financial help program meant for the low income people. Thus, Medicaid is based on social welfare and need. Accordingly, eligibility depends on the personal income of an individual. Medical bills are paid from local, state, and federal tax funds. The program serves individuals across all ages, provided their income is low enough in a way that makes them unable to access health facilities. Medicare covers people who are aged 65 years. In addition, it usually covers people with disabilities, pregnant women, children, and parents of eligible children (Holahan & McMorrow, 2012). Though poverty is still used to determine the eligibility of an individual in Medicare, a person must fall within one of the coverage groups and also be poor in order to qualify for the program.
The other difference arises as to what participants pay. For Medicare, participants pay monthly premiums, deductibles, copayments, and coinsurance. Participants can also purchase Medicare Supplement Insurance, commonly referred to as Medigap. The policy is sold to private companies to enable them pay health care costs that Medicare did not originally cover. However, participants in Medicaid do not have any out of pocket costs. Generally, a small co-payment may be required, though on rare occasions, which is determined by the state.
There are several ways in which both Medicare and Medicaid can be improved. Both health programs are currently fiscally unsustainable and reforms must be implemented. These reforms need to be positive for both the taxpayers and the beneficiaries. In fact, there are several ideas that can be implemented to attain efficiency.
To improve Medicare, policy makers should find a bipartisan solution that offers long term services and supports financing (Alley, Asomugha, Conway, & Sanghavi, 2016). Currently, most people mistakenly believe that Medicare covers these services. However, the option is only available for some individuals and too expensive for most. The number of Americas who will be in need of long term supports and services is likely to double in the coming few decades, affecting more than 27 million Americans by the year 2050 (Alley, Asomugha, Conway, & Sanghavi, 2016). Therefore, Medicare needs to find a solution to long-term support and services financing through private and public collaborations so that it can offer options that are affordable to individuals. Moreover, low income people with Medicare should be allowed to access benefits that make health care affordable.
Currently, the median income for Medicare beneficiaries is just $23,500. Although substantial strides have been made in the past few decades to increase eligibility, more efforts need to be done to enroll more eligible people to the program. With an ageing senior population, there is a need for support and expansion programs to assist and enroll individuals who are eligible for Medicare program (Alley, Asomugha, Conway, & Sanghavi, 2016). In an effort to address this problem, the Congress recently made Medicare’s Qualifying Individual assistance program permanent, enabling it to offer help for most low income individuals. However, half of the people eligible for such a program have not yet received it. Lastly, Medicare needs to increase access to preventive programs and services. More efforts need to be focused on promoting access to chronic disease self-management awareness for millions of Africans currently infected by multiple chronic conditions. An evidence-based research on the impact of chronic disease self-management and prevention program has proven that it reduces emergency and hospital costs, and improves health.
For Medicaid to serve its purpose effectively, several improvements need to be implemented. To begin with, eligibility rules and processes need to be modernized. Currently, a quarter of all uninsured persons and three quarter of the children are eligible for Medicaid but remain unenrolled. Most of these individuals are unaware that they are qualified for the program due to its complicated eligibility rules. Moreover, administrative barriers such as face to face interviews and burdensome documentation requirements have prevented eligible families from enrolling for the program. Therefore, eligibility rules and processes need to be simplified to increase effectiveness in outreach and enrolment efforts. In addition, uncertainty over who is eligible or not should be eliminated to allow more people to enroll into the program (Alley, Asomugha, Conway, & Sanghavi, 2016). Moreover, there is an increasing need that Medicaid increases its provider payments.
It is essential for Medicaid to raise payment rates to levels that are sufficient to encourage more providers to participate actively in the program. Currently, the program pays health care providers lower rates than Medicare or private insurance. Medicaid also needs an adequate and reliable source of funds that allows the program to adapt to the changing needs and economic conditions without putting the services or the beneficiaries at risk. Since Medicaid enrolment is increasing, the federal government must ensure it provides adequate resources to carry the program in both tough and good economic times. One way of achieving this goal is by increasing federal matching rate for all states or shifting more of Medicaid financial obligations to individuals who are eligible for both Medicaid and Medicare.
What is the Meaning of Managed Care?
Managed care is the current prevalent system through which health care services are being provided (Kongstvedt, 2012). This system provides a broad range of insurance products that are available to consumers. In particular, it integrates the payment and delivery of products and services in health care to consumers in an effort aimed at delivering the highest quality services at the minimum cost possible.
Hospitals, laboratories, physicians, and clinics comprise the organization of managed care. Center of Excellence is an assigned designation by organizations in managed care, a hospital, and in some instances networks of hospitals. The Center of Excellence are selected to provide patients with managed care plans and specific set of medical or clinical services such as organ transplants. Ordinarily, the hospitals designated as Centers of Excellence are chosen when they meet a criteria developed by the plan. The criteria comprises among other requirements, the ability to offer high quality services at competitive prices (Kongstvedt, 2012). Noteworthy, the Centers of Excellence requires physicians that are certified by the board to oversee its programs. Therefore, the board conducts a regular review of the performance status of the provider’s hospital. These centers also require that specific credentials be met by the hospital, the support services such as pharmacy or laboratory, and the personnel. To maintain the centers designation, periodic re-examination of the facility, its programs, and personnel should be carried out by the management board of Managed Care. In this case, the board sends representatives whose role is to perform inspections and evaluations in such Centers of Excellence.
The managed care system of delivering health care services is a change from the initial indemnity plans (Kongstvedt, 2012). The indemnity plan offered health insurance cover to members of the nation before the emergence of managed care plans. Also, it required that members prepaid a premium in exchange for an amount of monetary coverage that was specified, in the event of an accident or illness. However, managed care system utilizes fee-for-service procedure, which is a reimbursement that is based on specific services given to the plan member. In this kind of system, the physician, or any other service provider is paid a specific amount for services rendered, as stipulated in the fee-for-service plan. This plan may at times result to a patient being billed for the difference between fee-for-service amount paid to the service provider by the managed care plan and the bill charges amount incurred for the provision of the services.
There are various kinds of managed care plans. The first one is the Health Maintenance Organization, which offers prepaid, comprehensive health coverage for hospital and physician services. HMOs contract with health care service providers such as hospitals, physicians, and health professionals. Generally, a beneficiary obtains a referral from a primary care physician for services offered and must obtain services from a participating service provider. Reimbursement occurs only when the member obtains pre-authorization from the primary care physician and care from a participating provider.
Secondly, there is Preferred Provider Organization, which is also referred to as an open-ended HMO. The plan does not require the member to have a primary care provider or physician. Moreover, subscribers are allowed to access treatment outside the network but at higher deductibles and co-payments than the individuals utilizing network physicians. Moreover, there is a Point of Service Plan that offers a good deal of choice and flexibility regarding service providers and facilities. Such types offer reimbursement at a certain percentage regardless of the provider who renders the care. Beneficiaries are exempted from seeking the services of primary care physician. In addition to that, there exists Exclusive Provider Organization. This program consists of a network of providers who have agreed to offer services to members at a discounted fee. Members do not need referrals for the services offered by the network providers, including the specialists. However, should the patient choose to seek medical care outside the network of providers, they are not reimbursed.
The last three programs are not well developed but are still operational. Physician-Hospital Organization is a contracted agreement arrangement between hospitals and physicians, in which PHO enter into contracts to provide services to the insurer’s subscribers. Individual Practice Association is another type of managed care under development. The organization comprises of physicians and other medical services providers who enter into contractual agreement with employers or health plans to provide certain services or benefits. Finally, there is Managed Indemnity Program, where the insurer makes payment for the covered services, after the services have been offered and various methods used to monitor cost effectiveness. Such methods of measuring effectiveness include second surgical opinion, pre-certification, utilization review, and case management services.
Alley, D. E., Asomugha, C. N., Conway, P. H., & Sanghavi, D. M. (2016). Accountable health communities—addressing social needs through Medicare and Medicaid. N Engl J Med, 374(1), 8-11.
Holahan, J., & McMorrow, S. (2012). Medicare and Medicaid spending trends and the deficit debate. New England Journal of Medicine, 367(5), 393-395.
Kongstvedt, P. R. (2012). Essentials of managed health care. Burlington, MA: Jones & Bartlett Publishers.