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Klobuchar & Walz Say Medicare Reform Must Aim for "Best Care at Best Price"

Medicare Shortchanges High-Quality, Low-Cost State Like Minnesota

August 18, 2008

Rochester/Mankato, MN – At forums in Rochester and Mankato with health care leaders and senior advocates, U.S. Senator Amy Klobuchar and U.S. Representative Tim Walz said that reform of the Medicare system must aim for “the best care at the best price” by paying health care providers according to the actual quality of care they deliver rather than the volume of procedures they perform.

Created in 1965, Medicare provides health coverage to nearly 44 million Americans, including about 37 million people age 65 and older and another 7 million adults with permanent disabilities.  Medicare’s annual spending is over $400 billion and accounts for about 14 percent of the federal budget.

“Sooner rather than later, Medicare requires fundamental reforms to promote better-quality care for patient and to control costs,” said Klobuchar.  “The current Medicare payment system isn’t doing right by our seniors, our taxpayers or our health care providers.  And it’s not doing right by Minnesota, either.”

“Minnesota has consistently been ranked as one of healthiest states in the nation, due in large part to the quality of our physician care,” said Congressman Walz. “It is unfair that Medicare penalizes Minnesota doctors for doing their job better than nearly every other state.”

Klobuchar noted that the average senior in Miami costs Medicare about twice as much per year as a senior in Minnesota.  Yet, Medicare’s own reports show that the quality of care is significantly higher in Minnesota.  (Demographic and cost-of-living differences account for only a portion of the geographic disparity.)

“Instead of rewarding doctors and hospitals for quality care,” Klobuchar said, “Medicare is making payments based on the sheer volume of services, regardless of need or outcomes.  As a result, states with traditionally high utilization of services but poor quality outcomes get reimbursed at a higher rate.  A high-quality, low-cost state like Minnesota gets shortchanged, especially in our smaller communities and rural areas.”

Klobuchar said the solution is for Medicare to tie its spending to quality care and medical outcomes.  

Klobuchar and Walz acknowledged that there will be no action this year to reform Medicare.  But, they said, the momentum for reform will be strong in 2009, with a new president who must answer to the public’s demand for change.  In addition, the financial pressures on Medicare will only get more severe because of the aging Baby Boom population.

The forum at the University of Minnesota Rochester featured a discussion with former U.S. Senator David Durenberger, founder and chair of the National Institute for Health Policy; Dr. Denis Cortese, President and CEO of the Mayo Clinic; Dr. Jennifer Lundblad, CEO of Stratis Health (Minnesota’s Quality Improvement Organization for Medicare); and Lee Graczyk, Issues Director for the Minnesota Senior Federation.

The forum at Mankato’s Summit Center featured  Dr. Paul Matson, a Mankato surgeon who is past president of the Minnesota Medical Association; Dr. Jennifer Lundblad, CEO of Stratis Health (Minnesota’s Quality Improvement Organization for Medicare); and Lee Graczyk, Issues Director for the Minnesota Senior Federation.

 
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