You know that highly efficient program they call Medicare😜

Did you ever wonder why Medicare is touted as being so much more efficient than private insurance carriers? Well, in large part Medicare does not do the things private insurers do to manage costs, claims or administration. Hence Medicare’s lower administration costs. 😳

Now as part of the deal to avoid cuts in physician payments under Medicare, there is also a big change in administration. Social Security numbers will no longer be allowed as beneficiary ID numbers and will not be shown on Medicare cards. That’s a good thing, of course.

What is frustrating is that government audits (the Government Accountability Office, an investigative arm of Congress urged the change in 2004), have called for this change for over ten years because of the security risk and bureaucrats ignored the warnings.

Now it will cost $320 million over four years; all of it to be taken from the Medicare Trust Fund. [NOTE1]. In addition, it will take eight years to fully implement the change. If the phase-in had started when recommended, it would be complete by now…and no doubt cost less as well 👀

[NOTE1]  The estimated depletion date for the HI trust fund is 2030, 4 years later than was shown in last year’s report. As in past years, the Trustees have determined that the fund is not adequately financed over the next 10 years. HI taxable earnings in 2013 were slightly higher than last year’s estimate; after 2013, however, projections of earnings throughout the period are lower mostly due to lower GDP based on lower assumptions for the GDP deflator and real GDP.

HI expenditures in 2013 were significantly lower than the previous estimate, and through 2016 the projected level grows more slowly than shown in last year’s report largely due to reductions in utilization assumptions, reflecting recent trends. HI expenditures have exceeded income annually since 2008 and are projected to continue doing so through 2014. The Trustees project slight surpluses in 2015 through 2022, with a return to deficits thereafter until the fund becomes depleted in 2030. Source: 2014 Medicare Trustees Report