Medicare and Medicaid - Essay Example

"Medicare and Medicaid" is a perfect example of a paper on the health system.
Following turbulent early years in the healthcare industry, various programs and policies such as Medicaid and Medicare have been developed to ensure that there is managed care and that there is a reduced cost of care, high quality of care, and improved access of care. During the past decade, both Medicare and Medicaid have made an enormous commitment to contributing to managed care. These programs have made huge impacts in improving the healthcare system; however, they are faced with various challenges which must be addressed as quickly as possible to ensure success in the programs. This paper is going to elaborate in detail on the Medicare and Medicaid programs with relation to managed care and explain the challenges faced by each program in delivering healthcare services.

Medicaid and managed care

 Managed care is a system of health care delivery organized to achieve quality, utilization, and cost. Medicaid managed care enables the delivery of health benefits from Medicaid as well as additional services by contracting managed care organizations and state Medicaid agencies that give these services in exchange for a monthly payment per member (Rowland, & Garfield, 2000). States can reduce the cost of the Medicaid programs and ensure better management and utilization of healthcare services by contracting different managed care organizations to offer Medicaid health care services to its beneficiaries. The primary objectives of Medicaid managed care are to improve outcomes, quality of healthcare, and health plan performance (Gold, 1999). Various range of policies has been implemented by multiple states to integrate and coordinate healthcare beyond the ordinary and traditional managed care. These initiatives are aimed at building accountability for a high quality of care, aligning payment incentives accompanied by performance goals, and improving care for people with complex and chronic conditions.

Challenges

 First, the Medicaid program evaluates every plan of treatment. Still, it does not cover a particular procedure that is viewed as experimental or unnecessary, thus leading to issues for the physicians and affecting the patient's health. There will be little or no choice for the doctor and her patient because the program refuses to cover the expenses of specific procedures (Rowland, 2003). Additionally, Medicaid has made a policy to ensure that cost of care is down as compared to what is charged by the doctors. These low rates have discouraged doctors from accepting to work with patients with Medicaid. Apart from low prices, reimbursements in Medicaid take a long time, that is, 37 to 155 days. This aspect makes it difficult for smaller medical practices that need to operate in cash (Gold, 1999). Lastly, Medicaid patients usually face discrimination, particularly in nursing homes. Reports indicate that older people are prone to be transferred to different settings once they switch to Medicaid from private pay (Perkins, 2002). Other reports also suggest that Medicaid patients usually face refusal to admit or accept in nursing homes. These challenges, in one way or another, eventually result in difficulty in accessing care and low quality of care for the given patients.

Medicare and managed care

In simple terms, Medicare is a health insurance program implemented by the federal for particular younger people who have disabilities, people above 65 years, and people with End-stage renal disease. Medicare consists of various parts which help in covering certain services. Medicare Part A covers hospice care, care within a skilled nursing organization, inpatient hospital stays, and some home healthcare (Piccini et al., 2012). Medicare part B covers preventive services, medical supplies, outpatient care, and particular services from doctors. On the other hand, Medicare part D covers prescription drugs. Managed care has been used to help in ensuring low cost, high quality, and easy access to care across the United States. 

Challenges

 First, the out-of-pocket cost is projected to rise for the beneficiaries. There are financial difficulties faced in the Medicare system, thus making Medicare beneficiaries face higher costs. Reports show that nowadays, Medicare beneficiaries pay approximately 30% of the total healthcare cost directly from their pockets (Fyke, 2001). Secondly, in 2008, Medicare went broke. The Balanced Budget Act of 1997 facilitated the solvency of Medicare's trust funds for the next decade. The trust fund would go bankrupt in 2008 if no reform were done.

Additionally, nearly 77 million baby boomers were expected to enter Medicare in 2011. Therefore, Medicare must be improved and strengthened to handle the high population demand (Cohen, & Wilson, 2009). Lastly, there will be difficulty in funding Medicare because of fewer workers per retiree. These challenges have contributed to the high cost of care and low quality of care (Clark, & Hulbert, 1998).

Conclusion

Going into the future, the main areas of focus for state Medicaid agencies include proper oversight of managed Medicaid programs. States should increasingly seek affordable and integrated solutions, therefore, integrating the services and population into managed care programs. Additionally, managed Medicaid programs have other changes such as social determinants of health, innovation, technology and modernization, and cost management, which must be adequately maintained to ensure a successful system of healthcare. On the other hand, Medicare is expected to enroll more beneficiaries because baby boomers are expected to reach 65 years by 2030. However, Medicare innovatively uses value-based care, thus enabling better quality and better cost of care that ensures delivery of better health outcomes.