Americans Can Look for Serious Problems in Medicare, Medicaid and Prescription Drug Prices in 2009

While the bailout of the banks and the Big Three automakers is taking center stage in the nation’s economic crisis, the three-headed health care issue – Medicaid, Medicare and drug prices – could hit American consumers even harder next year.

“Throughout the presidential debates, much focus was devoted to the 47 million Americans who are currently uninsured and the additional 20 million that are underinsured, or do not have sufficient coverage for costly health care services,” says Dr. Marilyn Whitman, director of the healthcare management program at the Culverhouse College of Commerce and Business Administration at The University of Alabama.

“President-elect Obama has proposed reducing the cost of health care by investing in electronic health records, disease prevention, and coordination of care and providing affordable coverage to all Americans,” Whitman says.

“But, given the economic downturn and recent confirmation of a recession, the plan to expand coverage may be delayed. Priority will initially be given to state Medicaid programs which are currently struggling. In order to curb rising costs, many states have drastically cut Medicaid reimbursement to health care providers and halted enrollment,” she says.

Whitman points out that the economic crisis also threatens to hasten Medicare’s insolvency.

“Coupled with the increase in individuals suffering from chronic illnesses, Medicare will increasingly be challenged with retiring baby boomers who are living longer, but living sicklier, and a much smaller generation of workers to help cover the cost,” she says.

Whitman says one possible quick, short-term solution may be to allow Medicare to negotiate with pharmaceutical companies for cheaper drug prices and negotiating lower subsidies to private health plans for Part C, also known as Medicare Advantage.

But Whitman says 2009 may bring the largest number ever of people who don’t have health insurance.

“The loss of jobs this year will result in an increase in the number of uninsured individuals, because the majority of Americans obtain health insurance through their employer. We may witness a record number of individuals lacking health insurance in 2009. As a result, more states will follow Massachusetts’ lead in developing programs aimed at achieving universal coverage.”