Medicare deficit looming
2/8/09 | 14 comments

Medicare deficit looming


Funds shortfall could hit as early as this year
By Mal Leary
Capitol News Service

AUGUSTA, Maine — Most Maine seniors depend on the federal Medicare program to pay for part of their health care. Former Gov. Angus King, who served as vice-chairman of a national commission that studied the program, says Congress needs to shore up the program that could run short of funding as early as this year.

“Medicare is part of the Social Security system,” King said in an interview. “A huge expansion was passed five years ago, the prescription drug benefit, without a dime of funding. Medicare goes cash negative in the next year or so — in other words it will be spending more than it takes in from its underlying tax. That’s where the big problem is going to be, and that’s what no one is paying much attention to right now.”

Medicare and Social Security are funded from a payroll tax, paid by both workers and employers. While Social Security funds are adequate, King says the increasing costs of health care and the increasing number of seniors are putting great pressure on the system.

Medicare accounts for more than one-fifth of all health care spending in the nation and totaled $426 billion in 2007.

“It’s a big issue that needs to be addressed by Congress, even with all the other huge issues they are facing,” he said.

Sen. Olympia Snowe, R-Maine, agreed with King. She serves on the Senate Finance Committee that has jurisdiction over Medicaid, Medicare and Social Security. She said there are several proposals under consideration to improve health care overall that would help with the Medicare problem.

“For example, there is a study that says if we fully deploy health technology so all records are electronic, it would save the health care system $500 billion,” she said. “That would save money for Medicaid and Medicare.”

Snowe said many of the cost issues plaguing Medicare are also problems for the entire health care system. She said any improvements to the system will help the problems facing Medicare.

“But there is no question we are facing a serious problem that we will need to resolve,” she said. “It is a looming issue that we will have to address.”

Maine’s Democratic 1st District Rep. Chellie Pingree said Congress will have to deal with the Medicare problem and agreed with Snowe that at least part of the solution will be improving the nation’s health care system.

“I think that President Obama has made it clear that we need a new national health care system and that it will be a priority of his administration,” she said. “I think creating a better national system will help solve the problems we are facing in Medicare.”

Pingree said she wants to be involved with the effort to create a new health care system as she was involved in health issues when she served in the Maine Legislature.

“I think we have the opportunity to take a fresh look at what we are doing and what we can do better,” she said.

Sen. Susan Collins, R-Maine, said the country is facing a “serious” challenge with rising health care costs affecting many federal budget areas, not just Medicare, as well as the budgets of individuals and families.

“Without significant reform, our spending on these programs is on an unsustainable path, and our aging population only exacerbates the problem,” Collins said. “While the attention of Congress and the new administration is currently focused on the economic crisis, the looming Medicare shortfall is a new crisis in the making that cannot be ignored.”

Second District Rep. Mike Michaud, a Democrat, said he is very concerned about both the short-term fiscal impact and the long-term problems posed by Medicare. He and other members of the conservative Blue Dog caucus plan to meet with President Obama on the issue later this week.

“The solvency of Medicare is something that we cannot continue to ignore,” he said. “Kicking the ball down the field each year is only going to make our fiscal challenges worse.”

Michaud said one reason he bucked his party leaders last month and voted against the rules for writing this year’s federal budget was the elimination of the requirement that a plan be developed to address the long-term funding of entitlement programs, such as Medicare.

“The Obama administration has signaled that they want to get costly entitlement spending under control, but it is going to require reforms and some tough decisions,” Michaud said. “I’m disappointed that leaders on Capitol Hill don’t seem as committed.”

King acknowledges Congress has a “full plate” with all of the financial issues facing the nation, but said the potential size of the Medicare problem is also a serious financial problem for the nation. He said the federal budget deficit is already huge and growing and adding what was once unthinkable sums to the national debt.

“The question is: How big is our kids’ credit card?” he said.

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Comments
14 comments on this item
On 2/8/09 at 11:25 PM, captainandy wrote:         Repeated separate thumbs down will cause comment to be hidden

Dirigo Health Care - FAILURE

Medicare - FAILING

Medicaid - FAILING

Based on this track record, why would any citizen trust inept, corrupt, government bureaucrats to "fix" the healthcare system?

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On 2/8/09 at 11:27 PM, captainandy wrote:         Repeated separate thumbs down will cause comment to be hidden

Ask your local hospital how many millions they are owed from the above programs for services provided 2,3, and 4 years ago!

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On 2/9/09 at 5:14 AM, bumpinroad wrote:         Repeated separate thumbs down will cause comment to be hidden

maybe we should give more to the rich......remember they will take care of the poor....after they purchase a few more yatchs, and a few more mansions...etc. etc....

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On 2/9/09 at 6:35 AM, Tikitorch wrote:         Repeated separate thumbs down will cause comment to be hidden

Medicare and Social Security are nothing but a Govt run Ponzi scheme!

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On 2/9/09 at 7:21 AM, downbeat wrote:         Repeated separate thumbs down will cause comment to be hidden

Our country cannot sustain all the social programs they have started....it has ruined our work ethic and we all think goverment can solve our problems...we have to solve our own problems and not look to politicians to do it... it is very apparent how inept they all are..

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On 2/9/09 at 9:18 AM, safedman wrote:         Repeated separate thumbs down will cause comment to be hidden

Laziness has ruined our work ethic, not the government. Though they have made it easier to be a slug. It is ingrained in a good protion of our society that if you have kids you can sit home, drink beer and have your childrens father live there for free while the state pays for food, fuel and school.

Time to stop the gravy train. CALL YOUR SENATORS

It happenes every voting cycle. This State vortes the same lame back in. WHY???

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On 2/9/09 at 9:27 AM, JoyJessun wrote:         Repeated separate thumbs down will cause comment to be hidden

Our government throws money away like there is no tomorrow to be concerned about. The mental health system alone spends gross amounts of money on unnecessary, lavish foolishness. The state pays for homes that house only one or two individuals because they are "mentally ill" , which usually means they are on drugs or are a drunk, or are just plain lazy and manipulative. they then furnish these homes with big screen tvs, very nice furnishings which the ill ones pee on or smash when they have tantrums, (but that's ok because the state will replace any damaged items) They provide a new car or van for each home to cart around the MI because GOD FORBID they should be inconvenienced to have to use public transportation! The MI don't have to work one day of their lives and can freely live off the system while those of us who work, whether we feel like it or not, have to support them. I am not talking about those with MR who truly do need help, I am talking about the millions who claim to have ptsd because they were not breastfed,those who refuse to provide for themselves because they are useless and too lazy to work and society is more than happy to create a new label for them so they can gain more government funding. How many millions of people are receiving welfare because they are "depressed" or "bipolar"? What a huge bunch of crap. Our government system is bipolar and depressed and is procreating worthless, lazy welfare sucking bums for those of us who work to feed.I say shoot em, if they are too sick, drunk, drugged or stupid to care for themselves, put them to sleep so the rest of us can get on with our lives!

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On 2/9/09 at 9:35 AM, Louise wrote:         Repeated separate thumbs down will cause comment to be hidden

Joy----I worked with "mentally challenged" adults for quite a long time. I guess I never hit the right place, as according to you these people live like kings and queens off the state! Do you actually know anything at all about Bi-Polar disease? Lets hope that you never contract it and someone that has read your sickening comment dosen't decide to put You to sleep! What an ignorant remark!!

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On 2/9/09 at 10:14 AM, howbri wrote:         Repeated separate thumbs down will cause comment to be hidden

I want the same medical coverage that congress has given themselves!! So now the same government that screwed up SS and Medicare will screw up what's left of our health care system. Great!!

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On 2/9/09 at 10:42 AM, EmilyMichaud wrote:         Repeated separate thumbs down will cause comment to be hidden

Socialized medicine is the only answer. It works everywhere else. Vote the Republican senators OUT and anyone else who subscribes to bankrupt conservative ideas. They are dying as is their ideology. The government can be forced to be transparen.t but the insurance companies and drug companies can't. Only the rich can take advantage of our supposed advanced medical system. Government bureaucrats are NOTHING compared to the corruption of so-called private industry

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On 2/9/09 at 5:01 PM, alldressedinred wrote:         Repeated separate thumbs down will cause comment to be hidden

This is what we get for molding gererations of people into believeing that they would be taken care of in retirement instead of encouraging them to be selfsufficient and have them prepared for retirement. And also for not making health insurance companies more competitive thus lowering the cost of insurance, and then again for needlessly giving people millions of dollars out of hospital fund via insurance for a human being making a mistake. The next time my college prof messes up on grading a test, do I get to take him to the cleaners?

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On 2/9/09 at 5:13 PM, chersully2000 wrote:         Repeated separate thumbs down will cause comment to be hidden

Louise: You are so right. They should walk in another's shoes but have no understanding or compassion. They know not what they speak of. Some people, it is true, do take advantage of "the system" ...they could, with some willpower and self-worth, learn to take care of themselves and be independent. Unfortunately though, this is not the case for everyone.

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On 2/9/09 at 8:36 PM, eastmainer wrote:         Repeated separate thumbs down will cause comment to be hidden

A Social Security Pension and Medicare are NOT welfare. At least not for those of us who worked for 50 to 55 years and paid into these programs for all of those yesrs. Retired people pay a large sum for Medicare and also have to carry a supplimental insurance to be covered . These two medical payments add up to approximately $500 or more a month for a husband and wife. Does that sound like welfare to any of you ?

The Medicare Program is hurting because the healthcare providers are having their patients have office calls way more than necessary . Some people go to the emergency rooms at a hospital instead of the doctors office and they call for an ambulance so they won't have to wait for 5 or 6 hours to be seen. A lot of these aren't emergencies , but a elderly person living alone is scared when they feel sick and think they need immediate help. If doctors made house calls as they did years ago some of this problem would be solved

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On 2/11/09 at 9:28 AM, HillinDexter wrote:         Repeated separate thumbs down will cause comment to be hidden

EmilyMichaud's comment that socialized medicine works everywhere else is incorrect. In Britain, where there are +/- a million people awaiting non-emergent inpatient hospital admissions, 15% of the beds are empty and another 15% are filled with chronic patients whose ailments require nursing home care but no nursing home beds are available. The result is that acute care patients have to compete for the 70% of the beds remaining. That doesn't sound like a system that's working.

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