What is the current state of affairs on Medicare and Medicaid? What has been accomplished and what still needs to be done?

Expert Answers
maxseijo eNotes educator| Certified Educator

The last major change to the American healthcare system occurred in 2010 after the passage of the Affordable Care Act (Obamacare). 

Here are some of the changes that were made:

Medicare: 

Obamacare changed Medicare in one clear way. All those earning an annual income of $85,000 or more are now paying slightly more for their Medicare Part D prescription drug coverage.

Overall, Medicare was mostly unchanged.

Medicaid:

Obamacare greatly expanded the requirements for Medicaid services. It is now 133% of the poverty line. However, the Supreme Court made this expansion opt-in only. This means that states can choose not to expand the program. Many conservative states have done this in opposition to the law.

In the states that have expanded, the federal government will fund 100% of the excess cost until the end of 2016, after which this funding gradually phases down to 90% by 2020.

Overall outlook

As a general rule right now, politicians and policy analysts disagree about the long term ability for the federal government to sustain our national healthcare programs.

Here are some commonly proposed changes:

Medicare:

Raising the eligibility age - as American life expectancy continues to rise, some propose raising the eligibility age from 65 to 67. This would certainly reduce costs, but others fear it would leave vulnerable Americans without the insurance that they need.

Raise premiums - this would also reduce costs, but some fear it could possibly price out the poorest seniors.

Raise payroll taxes - the generation of new revenue via an increase in payroll taxes would help fund Medicare into the future, but some worry that increasing taxes on income will be unpopular and discourage work.

Medicaid:

Complete expansion - if all of the states were to pass the Medicaid under Obamacare, it would significantly reduce the amount of Americans without health insurance. Due to political opposition to the law, this task will remain difficult for some time to come.

Local fixes - as Medicaid is a joint federal/state program, there are a wide variety of issues and solutions that need to come from state-level regulation and budgetary processes. As a result, besides stemming the rise of medical costs, there isn't a "one size fits all" solution to the program's challenges.

Conclusion:

Medical spending in America is dissimilar from other developed areas of the world. We have unique challenges, but also positive incentives.

The main challenge in the American healthcare system is costs. Medical costs have been rising for decades. And with an aging baby boomer population, the rising costs will continue to put burdens on our budget. 

There is debate as to what should be done about these future problems, but as these programs remain quite popular (specifically Medicare), it is quite hard to cut people's benefits.