About the Author

James C. Capretta

James C. Capretta

New Atlantis Contributing Editor James C. Capretta is an expert on health care and entitlement policy, with years of experience in both the executive and legislative branches of government. E-mail: jcapretta@aei.org.


James C. Capretta’s Latest New Atlantis Articles

 Health Care with a Conscience” (Fall 2008) 

 Health Care 2008: A Political Primer” (Spring 2008) 

 The Clipboard of the Future” (Winter 2008)


 More on James C. Capretta

Text Patterns - by Alan JacobsFuturisms - Critiquing the project to reengineer humanity

Wednesday, June 11, 2008

Medicare Reform and Health Care Reform 

Medicare’s stark financial problems are well known but worth repeating often. Promised benefits are expected to exceed dedicated financing for the program by $36 trillion over the next seventy-five years (measured in present value terms). Between 1975 and 2005, annual program spending growth per beneficiary outpaced per capita GDP growth by an average of 2.4 percentage points annually.

In the latest Weekly Standard, I discuss Medicare’s immense financing challenge, covering fairly familiar ground for those familiar with the program. But I also argue that a central assumption of conventional health policy thinking in Washington is wrong. That is, most analysts argue that Medicare cost escalation is simply a function of system-wide cost pressures, and that Medicare spending growth will slow only with effective health care reform covering all payers.

This kind of thinking ignores Medicare’s dominant role in today’s marketplace. Medicare fee-for-service insurance is the number one reason today’s delivery system is fragmented, disorganized, and inefficient. Reforming Medicare, therefore, is central to encouraging more efficient hospital and physician arrangements. In other words, to slow health care costs down for everyone, a crucial first step is reforming how Medicare buys health care services.

The full article can be found here.

posted by James C. Capretta | 9:33 am
File As: Health Care