The economic situation has left much business in shambles, but the consequences of the recession may strike at those who rely on government programs like Social Security and Medicare. With more and more people leaving the workforce, these programs will eventually become so encumbered that they will collapse.
Congress has recently been mulling over proposals to fix the forthcoming crisis situation for Social Security and Medicare. One of these plans of action is to create a bipartisan commission that will preemptively tackle the problems facing government benefit programs. This commission would then assemble a package of adjustments for Congress to approve, …read more

The government warned on Tuesday that Social Security and Medicare will be insolvent sooner than previously expected. The trustees’ annual report revealed that Social Security will be paying out more money than it receives by 2016 (a year sooner than prior projections). Medicare is already doing the same.
Unless changes are made, the Social Security retirement fund will be depleted by 2037 and the Medicare trust fund will be insolvent in 2017. Additionally, Social Security recipients are not expected to get cost-of-living increases in 2010 or 2011. Cost-of-living increases have happened each year since 1975.
“We should neither be casual nor hysterical …read more

Now’s the time to double check your Medicare benefits and make any changes. The open enrollment period for individuals who are enrolled in Medicare plans to make final changes to their 2009 benefits ends Tuesday, March 31. Seniors and their caregivers have just a few days to take one more look, consider one more change before they can no longer switch to a new Medicare plan. The next opportunity to change will be in November for a January 1, 2010 effective date.

“By now, seniors should have had some experience with their current benefit packages, whether seeing physicians, filling prescriptions, or …read more

A new report out on the financial health of the nation’s leading hospitals and the prognosis is not good.

According to the report released today by Thomson Reuters, half of all U.S. hospitals are unprofitable. A lot of the downturn is the result of declines in non-operating revenues. Would that be investment income?
The study applied two dozen key financial indicators to the balance sheets of over 400 hospitals nationwide, including small, medium and large community hospitals, and major teaching hospitals.
The median profit margin among 439 hospitals in the study was 0% in the third quarter of 2008 and approximately 50% of hospitals …read more

Forbes magazine’s medicare piece on how medical costs increase due to corporate lobbying for CT scanning coverage that drives equipment sales, reveals the market’s reaction:
Congress: “…tried to rope in runaway Medicare costs by dramatically cutting imaging payments in outpatient settings…”
Private Insurers: “…Companies like CareCore Radiology, American Imaging Management and National Imaging Associates cropped up to do the dirty work of reviewing and rejecting imaging orders on behalf of insurance companies…CareCore’s research shows a doctor who owns his own machine is four times as likely to order a scan as a doctor who doesn’t.”
GE:”…a lot of the arguments against imaging are …read more

Forbes magazine’s medical industry piece “Cranking Up the Volume” comments on GE’s lobbying efforts for medicare coverage for CT scans enabling sales of CT scanning equipment:
“The party has gone on too long”.
Apparently, excessive coverage for CT scans has led to over doing and “over” covering the scans, thus increasing medical costs:
“Radiologist David Gruen used to spend millions of dollars to replace his General Electric (nyse: GE – news – people ) MRI and CT scanners every three years. It was money well spent because the machines were always busy.”
The economics of this is very interesting: more money for allowable scans …read more

Forbes magazine recently wrote about the medical industry in “Cranking Up the Volume“. Presumably, higher “volume” means more visibility into the processes behind medicare, medical equipment, and diagnosis. My contention is that our medical costs will go down if we can increase competition. Competition usually comes into play when information becomes available- information about services, prices, and costs of providing services. A useful comparison dealing with understanding costs of providing services is in the auto sales area; a few years ago information about dealer costs and margins made available on the internet enabled competition by allowing buyers to shop around …read more