The Future of Medicare, Post Great Societyand Post Plus-Choice: Legaland Policy Issues--Foreword

Medicare is many things to many people. To liberals, it is the great success story of the Great Society, a social insurance program that has brought health security to America's elderly and disabled. To conservatives, it is a bloated government program, verging on collapse and threatening the financial future of our children and grandchildren. To politicians, it is (with Social Security), the third rail of American politics, a tempting-but very dangeroustarget for budget cuts or for contracting or expanding the role of government. For providers it is a vital source of income, but also a terrifyingly complex program where coding mistakes can result in substantial penalties. For beneficiaries, Medicare provides an essential safety net, but one that is far from secure and full of substantial gaps.By any measure, however, Medicare is vitally important to Americans. Medicare covers thirty-five million elderly and six million disabled Americans.1 Forty percent of these Medicare beneficiaries have incomes below 200% of the federal poverty level, and 40% have less than $12,000 in assets.2 Medicare is the primary reason that many of these Americans have access to essential health care. Medicare is also very important to providers. Medicare accounts, for example, for nearly 30% of hospital and 29% of home health payments.3 But, Medicare is also very costly. Medicare is expected to pay out $271 billion in 2003, accounting for 13% of the federal budget and 19% of total national personal health services spending.4 Any serious attempt to control federal spending must, therefore, look carefully at the Medicare program.To those of us in the Academy, however, Medicare is an endlessly fascinating subject for research and analysis. In the spring of 2003, a renowned group of scholars gathered at the Washington and Lee University Law School in Lexington, Virginia, to share their thoughts about Medicare. This distinguished group represented a wide variety of disciplinary perspectivespolitical scientists, policy experts, legal academics, and economists. It included faculty from law, public health, medical, and business and management schools, as well as scholars from independent research institutes. Among its members were a former Administrator of the Health Care Financing Administration (HCFA), which once administered the Medicare program; a former director of HCFA's Center for Health Plans and Providers; a former member of the Medicare Trust Fund Board of Trustees; and a former member of the Provider Reimbursement Review Board. This group represented the full range of political perspectives on the program.This Symposium issue of the Washington and Lee Law Review represents the fruit ofthat conference. As this Issue goes to press in the winter of 2004, Congress has just adopted legislation making major changes in the Medicare program. This legislation partially fills one of the most significant gaps in the Medicare program: its lack of coverage for outpatient prescription drugs. But, these changes still leave many gaps in drug coverage and are certain to be a grave disappointment to many Medicare beneficiaries. Under the legislation, for example, a beneficiary is responsible for the first $250 of drug costs, twenty-five percent of the next $2000 in costs, and then must spend $2850 more out of pocket before catastrophic coverage becomes available.5 This legislation includes broad changes to the Medicare Program that would greatly expand subsidies for the Medicare managed care program (renamed Medicare Advantage) and create a demonstration project that would put traditional Medicare in direct competition with managed care plans.6 This legislation is likely to provoke further intense debate about the future of the Medicare program. Though it was too late to revise the articles in this Symposium by the time Congress finally took action on the prescription drug legislation, each author was given the opportunity to add a postscript to his or her article addressing this legislation and how it affects the topic of his or her article. …