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Timely proposals to reform medicare

September 21, 1982



By considering changes in funding methods for the medicare program, the Reagan administration finds itself caught in a political thicket. Eugene Eidenberg, director of the Democratic National Committee, for example, has said that just one of the proposals now being studied - a possible means test to determine who would be eligible to receive medicare benefits - will generate ''a firestorm of reaction.'' Mr. Eidenberg has suggested that Democrats will campaign on the medicare issue in upcoming congressional elections.

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Surely what is not needed at this point is turning the whole knotty medicare funding problem into just another campaign issue subject to demagogy from all sides of the political spectrum. What is needed - and long overdue - is a hard-headed and sober assessment of a major social security program that will cost $50 billion this year, and unless reformed by Congress, close to $100 billion by 1987. The Reagan administration deserves plaudits for a willingness to weigh options for a reform of the program that meets health-care costs for some 29 million Americans.

Among the changes now being considered for medicare: raising basic costs to recipients, such as requiring larger deductibles; requiring beneficiaries to pay a fixed percentage of hospital charges under the Part A coverage, which would, in effect, be similiar to what is now required under the Part B coverage; introduction of a possible means test to determine levels of support to elderly persons above certain income levels; turning medicare into a form of ''catastrophic'' coverage that would begin above outlays of, say, $3,000. Supplemental coverage below such levels, however, would be available at a special premium.

If a means test were to be instituted, according to preliminary thinking within the administration, then low-income persons would be given supplemental coverage under the medicaid program.

Granted, each of the proposals will trigger criticism from many recipients. And some proposals, such as changing medicare into just a ''catastrophic'' program, look less politically likely than others, such as instituting a modest hike in deductibles. But a number of fiscal and demographic realities must not be overlooked in the discussion:

* Medicare costs have been rising sharply in recent years because of the high rate of increases in hospital costs.

* Despite rising costs, the program is not selective; i.e., it is not aimed at those persons most needing financial help. Rather, it applies indiscriminately to all elderly Americans, including middle- and upper-income persons.

* That portion of the population that is ''elderly'' has been rising steadily during recent years and will post a sharp jump around the end of the century when the ''baby boom'' generation reaches maturity. That alone will put enormous financial strain on transfer programs such as medicare.

Congress has already taken steps to shave medicare costs by making changes in reimbursement levels for hospitals beginning Oct.1. That action will save up to objective should be to make the system as cost-efficient as possible, while not overlooking that the program remains vital for millions of persons. The task for lawmakers will be to use the administration proposals - when they are finally sent to Congress - as a jumping off point for an unemotional, clear-sighted reform of the program.