The population of the elders is increasing in the US. About three percent of the population or three million individuals belonged to this segment, in the 1900. The population and proportion of this group has increased significantly. In the year 2000, 35 million or 12.4 percent of the population belonged to this group (Rubinstein, H. G., 2005). Such an increase is mainly attributed to a general increase in the life-span of humans. Healthcare costs have risen sharply in the last few years, even several times more than the rate of inflation. Between 1980 and 1997, health expenditure for elders increased by 80 % and expenditure on drugs increased by about 169% (Diener, J., 2003). The present Medicare Insurance System does not seem to be providing much relief to this population (as they do not cover prescription drugs). The Medicare system was framed in the 1960’s, when it was considered that provision of just basic health facilities for elders and retirees was enough (Diener, J., 2003). Medicare at that time did not predict the effect of an increasing life-span, and rising healthcare costs. Many senior citizens are subscribing to supplementary insurance schemes that can help them to bear the costs of prescription drugs. However, they end up paying heavily for such insurance packages as they do not seem to be having many choices. The insurance companies are trying to cut down the insurance expenditure and return additional expenditure to the customers. Hence, several of these insurance schemes are becoming increasing unaffordable to the senior citizens.
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Many elders who retire before the age of 65 years, may not be able to avail post-retirement Medicare benefits for themselves and their dependents. Some individuals may in fact join their jobs back in order to be eligible for health insurance schemes from their employers. Employer-sponsored healthcare benefits may provide health insurance packages for about 3.8 million retirees (between the age of 55 to 64 years), and an additional 12 million benefit through supplemental insurance (Pallarito, P., 2006). The sheer number and increasing healthcare costs have made employers to seriously cut down healthcare benefits. The numbers of employers who offer healthcare benefits have serious reduced by about 50% in the last few years due to these developments (Pallarito, P., 2006).
The situation is even more serious in hospitalization and oral healthcare. A study conducted by Kozek et al demonstrated that there has been a significant increase in the rates of hospitalization from 99.2 per 10000 in 1980, to 133.8 in 1998 (Kane, N. M., 2002). The rates for hospitalization had risen sharply in elders compared in younger individuals. In spite of several advancements in the field of medical sciences, this increase occurred. Some people feel that this may be attributed to poor coverage of prescription drugs by insurance packages. The hospitalization in children in fact had significantly reduced due to utilization of vaccination and use of antibiotics. Many states in the US do not provide comprehensive oral Medical insurance covers for the elderly population (Rubinstein, H. G., 2005). Some states may only provide cover for emergency treatment. Even retirement benefit packages do not cover dental treatment. Studies suggest that less than one-sixth of the elderly population have access to dental insurance (Rubinstein, H. G., 2005).
Several options have been suggested to provide healthcare benefits to the senior citizens. Medical saving accounts can help to cover medical and dental insurance. The individual creates and controls funds that can be used to cover medical and dental costs. Money that is saved during one year can be utilized for the next year. Any unsaved portion will return back to the account holder. However, federal tax rules permit only limited participation of non-insurance schemes, especially for uninsured individuals who belong to a risk category.
The Health Reimbursement Arrangement (HRA) is package covers only low-cost services and infrequent high-cost services. The remaining portion, which is usually affordable, has to be paid by the participant (Rubinstein, H. G., 2005). Money that remains in an individual’s account is carried over to the next year. The participants also have the option of using saved funds to improve healthcare coverage or passing on their funds to their dependents. However, the amount that has to be paid for HRA is significantly higher, and many people may be having excessive expenditure such that they are unable to bear the costs of such a scheme.
One of the options that seem ideal for providing healthcare services at an affordable cost for senior citizens is ‘managed care’ (health maintenance organizations or ‘HMO’). In this healthcare package, all the healthcare services are integrated, and provided under a single roof to the customer (Kyomen, H. H., 2005). It aims to provide cost-effective healthcare options. All unnecessary expenditures, diagnostic tests, and duplication of interventions are prevented. Efforts are also on in providing preventive measures. Patients are not hospitalized for long periods. Managed care is ideal for senior citizens because several medical facilities such as preventive check-ups, hospitalization, general medical care, mental healthcare and drugs are all integrated at provided at an affordable rate (Sauber, R. S., 1997). Unlike Medicare, managed care does not turn the costs of prescription drugs and spectacles (lenses) over to the customer (Henry J Foundation, 2006).
The rising costs of healthcare for elders can be controlled to some extend by managed care. Studies have shown that elders who avail HMO packages spend much lesser on prescription drugs and other forms of medical expenditure, compared to those covered by Medicare. The expenditure on healthcare can be better predicted, and unexpected costs can be reduced through HMO. Managed care offers various options and packages for their customers which can suit their needs. In these ways managed care could help senior citizens to be more self-dependable and lead a life with respect.
Diener, J. (2003). Long-Term Study of Health Care Costs For Seniors Shows Sharp Increase in Expenditures. Retrieved December 28, 2006, from University of Missouri.
Henry J. Kaiser Family Foundation. (2006). Medicare Advantage Plans. Retrieved December 28, 2006, from Elder Options of Texas University of Missouri. Website: http://www.elderoptionsoftexas.com/article_medicare_advantage_plans.htm
Kane, N. M., & Siegrist, Jr., R. B. (2002). Understanding Rising Hospital Inpatient Costs:Key Components of Cost and The Impact of Poor Quality. Retrieved December 28, 2006, from Blue Cross Blue Shield Association.
Kyomen, H. H., & Gottlieb, G. L. (2005). Financial Issues in the Delivery of Geriatric Psychiatric Care, In. Sadock, B. J., & Sadock, V. A. (Ed), Kaplan’s and Sadock’s: Comprehensive Textbook of Psychiatry. Philadelphia: Lippincott Williams and Wilkins.
Pallarito, P. (2006). Retirees' Share of Health Tab Creeps Higher. Retrieved December 28, 2006, from Medicine Net.
Rubinstein, H. G. (2005). “Access to Oral Health Care for Elders: Mere Words or Action?” J Dent Educ. 69(9), 1051-1057. http://www.jdentaled.org/cgi/content/full/69/9/1051
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