Medicare on the table

Health care reform supporters participate in a sit-in inside the lobby of a building where Aetna insurance offices are located September 29, 2009 in New York City. The protesters were eventually arrested by NYPD.

Tess Vigeland: In addition to taxes and spending, the president had something to say about Medicare.

Barack Obama: We will slow the growth of Medicare costs by strengthening an independent commission of doctors, nurses, medical experts and consumers who will look at all the evidence and recommend the best ways to reduce unnecessary spending while protecting access to the services that seniors need.

It's that last part, about reducing the "unnecessary" spending, that always hangs up the discussion. As we know, one person's "unnecessary" could be another person's death panel. As Gregory Warner reports from our health care desk at WHYY in Philadelphia, it's hard to talk about saving money on Medicare without talking about the way we die. And no one wants to have that conversation.


Gregory Warner: About one-third of the money Medicare spends on a person's care is spent in the last year of life. So here's one of the most popular proposals to cut those costs: Instead of paying separately for every doctor's visit and every test the person might get, Medicare will pay a lump sum to one agency that coordinates care with the patient.

Shawn Bloom: I believe its very cost-effective because we're not ordering tests that the individual may not need or want.

Shawn Bloom is CEO of the National PACE Association. It's a group of 75 not-for-profit care facilities in 29 states.

Bloom: We were able to focus on the individual's preferences regarding end-of-life care, which makes the allocation of our resources much more efficient.

Warner: How much more efficient?

Bloom: I can't answer that. That's a highly hypothetical kind of question.

Warner: It's also highly controversial, isn't it?

Bloom: Yeah it's very controversial, correct.

Joel Hay is a health economist at the University of Southern California.

Joel Hay: You're not going to be popular in the marketplace if you say, 'We are the most cost-effective health system around' because people associate higher cost with better quality.

And he says recent studies show that giving patients more say in their care does not save money for Medicare. As people get sicker, they or their families demand more treatment.

Hay: Eventually you're gonna reach a point where there's very little you can do except for spend lots of money.

He says that still leaves the tough question of how that money gets spent. And who decides where to spend it.

In Philadelphia, I'm Gregory Warner for Marketplace.

About the author

Gregory Warner is a senior reporter covering the economics and business of healthcare for the entire Marketplace portfolio.

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