Feb. 13—In his State of the Union address, President Barack Obama laid out a vision of modest Medicare reform as one tool to control government spending.
The president said that the “biggest driver of our long-term debt is the rising cost of health care for an aging population” and that modest reforms were needed. He set a target of reforms whose savings would match the savings proposed by the Simpson-Bowles commission.
More specifically, the president proposed the following:
- Changing the payment system to reward quality rather than volume
- Reducing taxpayer subsidies to prescription drug companies
- Requiring greater contribution from the wealthiest seniors
The president said he was open to further reforms that did not “violate the guarantee of a secure retirement.”
HFMA Analysis: The president identified a change in the Medicare payment system to reward quality rather than volume among the “modest” reforms needed to reduce the Medicare program’s impact on our nation’s long-term debt. As HFMA members know, this change will have more than modest effects within their organizations, with significant implications for both finance and administrative functions and the delivery of care. HFMA’s Value Project can help your organization better understand and prepare for the transition from volume to value.
Publication Date: Wednesday, February 13, 2013