Big anniversaries provide the opportunity to reflect on the past and look toward the future knowing what worked, what didn’t, and what can be done to make the future even better. Fifty years ago, our nation made a promise to seniors that they would have the healthcare coverage they have earned. It was called Medicare, and it is a program and promise we, as Americans, hold dear.
Before President Lyndon B. Johnson signed Medicare into law on July 30, 1965, roughly half of Americans 65 and older were uninsured. A quarter of seniors were estimated to have gone without care because of concerns about medical costs. Now, thanks to Medicare, older Americans know they can count on Medicare to provide coverage for their health care needs.
To meet that promise, Medicare coverage expanded over the years to include not only hospitalizations, but outpatient care, preventive services, as well as new tests and treatments. Physician visits and prescription drugs, some with co-pays, are now all included. As a result, seniors are healthier and living longer.
But, there are new challenges ahead, both in the increasing number of new seniors and in the advances in modern medicine.
In 1965, 19 million seniors were eligible for Medicare. Today, Medicare covers more than 46 million people over 65 and an additional 9 million people with permanent disabilities. In the next 25 years, the number of people over 65 eligible for Medicare will more than double. Forty million new seniors — all those baby boomers — will swell the numbers of people covered by Medicare.
Just as the number of people enrolled in Medicare grows, our health care system is changing, as well. There are new cures and therapies, advances in pharmaceuticals, and new technologies that improve health status and lead to longer life expectancy. And Medicare has changed along the way, responding to these advances and ensuring that Medicare met its goal to offer health needs of seniors.
To keep pace with future changes in health care and the many new seniors, we need to be even smarter about the way care is paid for and provided.
We need to change financial incentives to focus on prevention and primary care, to better coordinate care, and to improve care for those with chronic conditions. We need to be sure people get the care they need, in the right setting. We have to reduce overutilization of tests and interventions that don’t improve health and focus our resources on what works.
With 75 percent of all spending on health care due to chronic diseases, we need to do more to identify risk and to intervene early to save lives and to save dollars.
For most of the last 50 years, Medicare has paid providers on a fee-for-service basis, which means doctors and hospitals were paid each time a patient went to see them for any reason. While this made sense in an era of acute illnesses and infrequent visits, this system rewards quantity over quality care. To change this, we need to modernize the financing of health services to ensure better quality and reward value not volume of care. By shifting payment and delivery strategies, we can encourage primary care teams, incentivize care coordination and continuity of care, and require attention to providing care to people, over time.
The good news is that there is already a model in Medicare for these best practices. It is called Medicare Advantage, and every day, seniors enrolled in Medicare Advantage plans across the country see the benefits of early intervention, coordinated care, and continuity of providers offered by MA plans.
Nationwide, more than 30 percent — almost 17 million people — who are eligible for Medicare have chosen Medicare Advantage plans. That number will grow, as half of newly enrolled Medicare beneficiaries are choosing Medicare Advantage. They value the enhanced benefits, the affordability, and the simplicity.
As Americans live longer, as the number of seniors increase, and as medicine advances, it will take the these kinds of changes to keep the promise that our nation made 50 years ago to seniors to ensure access to affordable, high quality health care. We can keep that promise for seniors today and tomorrow, if we implement the innovative changes in financing and care delivery that are already helping to keep Medicare the successful and valued program it has been for 50 years.
We should take pride in Medicare’s history and use this anniversary to commit to ensuring its future.
Allyson Y. Schwartz is President and CEO of the Better Medicare Alliance.