When asked about Medicare reform this afternoon in the Capitol, Senator Scott Brown (R-Mass.) said, "We need to stop playing games and we need to come up with some solutions." What solutions might those be? "I already laid it out yesterday," Brown told me, referring to an op-ed he published in Politico and declining further comment.
Brown wrote yesterday that Medicare reform must come by making "improvements to the traditional Medicare plan," not by the sort of reform outlined in the House Republicans' budget passed in April. He suggested cutting "waste, fraud, or abuse" could go a long way to making Medicare solvent:
The Government Accountability Office has estimated that nearly 10 percent, or $47 billion, of annual Medicare spending is nothing but waste, fraud or abuse. Attorney General Eric Holder has put the number higher — at $60 billion. We need Medicare administrators to work to prevent these improper payments — instead of the existing “pay and chase” model that makes the system so susceptible to fraud.
We can also find savings by increasing congressional oversight of how Medicare reimburses providers; as well as improving the quality of medical care to seniors.
I’d also institute tort reform to limit frivolous lawsuits. There are other ideas from members of both parties that can be incorporated into a bipartisan plan — which has a good chance of passing Congress.
According to this year's Medicare Trustees' report, Medicare costs for 2010 were approximately 3.6 percent of GDP, which amounts to nearly $530 billion. Taking out all $60 billion of projected waste brings spending down to $470 billion. That's an 11 percent reduction in costs for one year, assuming all of that waste can actually be prevented. But Medicare is also expected grow exponentially: the Trustees' report predicts spending on the program will jump to 5.5 percent of GDP in 2035. That's a bigger percentage of what will hopefully be a larger economy. And that same report predicts that Medicare "as we know it" will have its trust fund run dry in 2024. Will 11 percent reductions in annual spending be enough to stop the deluge as more Baby Boomers become eligible?
Brown also wrote in his op-ed that Congress must "get started now and, where appropriate, phase changes in over time." The Ryan Medicare reform plan does not even begin for 10 years and would only affect those citizens currently 54 and younger. Brown's spokesman has not replied to a request for comment on how the Massachusetts senator would like to phase changes in over time.