Restructure Medicare & Medicaid: Variables in Restructuring Medicare &
Medicaid to Reduce Material Impact on USA Inc.’s Expenses
Mathematical Illustrations* Slide 273-274 1) Medicare benefits — reduce them by 53% (or cap them)? or
2) Medicare tax rate — increase it by 4 percentage points?
Policy Options Slide 275-328
1) Combination of mathematical illustrations — reduce benefits and/or increase taxes? and/or
2) Isolate and address the drivers of medical cost inflation? and 3) Improve efficiency / productivity of healthcare system? and 4) Reduce services for some Medicaid beneficiaries? and
5) Consider / implement CBO’s 26 policy options that could reduce annual budget deficit by up to 38%?** and/or
6) Consider / Implement National Commission on Fiscal Responsibility and Reform’s medium- and long-term policy options***
Note: *Each mathematical illustration would bring Medicare Part A into long-term (75-year) actuarial balance. There is no mathematical illustration for
Medicaid or Medicare Part B & D as there’s no ‘dedicated’ funding.
“See: CBO, “Budget Options, Volume 1: Health Care,” 12/2008.
KP ***See: National Commission on Fiscal Responsibility and Reform, “Co-Chairs’ Proposal,” 11/10/10. www.kpcb.com USA Inc. | What Might a Turnaround Expert Consider? 271
Restructure Medicare & Medicaid: Mathematical Illustrations*
Mathematical Illustrations* 1) Medicare benefits — reduce / cap them? or
2) Medicare tax rate — increase it?
Note: *For mathematical illustrations, we simply calculate how big a revenue increase AND / OR expense decrease each major entitlement program needs to reach financial break-even. These calculations are merely mechanical illustrations and are not meant to portray realistic solutions.
KP www.kpcb.com USA Inc. | What Might a Turnaround Expert Consider? 272
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