Medicare, Medicaid, & Social Security

Medicare, Medicaid, & Social Security


Roger Feldman, Bryan Dowd, Robert Coulam | Oct 08, 2015
A new study published by the Mercatus Center at George Mason University assesses the numerous problems with Medicare’s price calculations and looks at how they affect prices in commercial insurance policies. The study proposes an arrangement of competitive bidding on bundles of services as a promising alternative to Medicare’s price-fixing regime.
David E. Bernstein | Sep 30, 2015
A new study published by the Mercatus Center at George Mason University describes how such an approach in Medicare Part B—which covers outpatient services such as office visits and preventive care—could enhance doctors’ participation in the program, expand choices for beneficiaries, boost innovation, and make prices more responsive to market forces. Below is a brief summary of this analysis. Please see “Restoring Freedom of Contract between Doctor and Patient in Medicare Part B” to read the entire study and to learn more about its author, David E. Bernstein, the George Mason University Foundation Professor at George Mason University School of Law.
Mark J. Warshawsky, Ross Marchand | Sep 10, 2015
A new study published by the Mercatus Center at George Mason University finds that part of the problem can be traced to a flaw in the SSDI program’s administrative structure: even if an applicant is twice denied disability benefits by the Disability Determination Service, he or she can often obtain benefits by appealing the rejection to an administrative law judge (ALJ). This study analyzes ALJ decisions using case studies, economic literature, descriptive statistics, and econometric analysis.
Mark J. Warshawsky | Jun 09, 2015
As the baby boom generation begins to retire, fewer and fewer private-sector workers have traditional defined benefit pension plans, which usually pay lifetime annuity benefits. Instead, they have accumulated considerable assets in 401(k) plans and individual retirement accounts (IRAs) that have no particular method of payout. Federal government policy, which has regulated defined benefit plans heavily and mandated plan designs for distributions, has tread more lightly on defined contribution plans because of their historical secondary nature.
Mark J. Warshawsky, Ross Marchand | Apr 28, 2015
We explain that the medical-vocational grid guidelines that are used to determine whether someone is disabled are an important part of the explanation for increased disability awards. The grid applies much looser standards for applicants as young as 45 and 50. We propose that age be eliminated as a deciding criterion, as well as language ability and education level. We also note that the guideline’s list of impairments is outdated and needs to reflect a modern workforce that has access to remedying medical technologies.
Mark J. Warshawsky | Apr 16, 2015
A new study for the Mercatus Center at George Mason University is the first to rigorously assess the details of the proposed regulation using empirical methodology widely accepted in the financial industry and comparing the proposed illustration to the Social Security statement. The regulation would require all defined contribution plans to inform their participants of the life annuity income equivalents of the current and projected balances in their individual accounts. The study examines several changes the Department of Labor can make to improve its proposal.

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Expert Commentary

Oct 08, 2015

Traditional "fee-for-service" (FFS) Medicare — which pays providers a fee for each service delivered — is the nation's largest health-insurance program, enrolling 38.1 million aged and disabled beneficiaries in 2014. The program pays more than 200 million claims for inpatient hospital admissions and home-health-care visits each year, and 1 billion claims for doctors' services. There are about 10,000 different services for doctors alone, and each of these fees is set through an administrative process that attempts to discern the cost of producing that service — called the "relative value" — in terms of the costs of physician work, practice expenses, and liability insurance.
Oct 05, 2015

The Affordable Care Act’s “Cadillac plan tax” has been much in the news of late. A motley collection of health sector companies, conservative ACA opponents, labor unions and presidential candidates is working for repeal. On the other side101 health policy experts recently wrote to urge Congress to retain the tax “unless it enacts an alternative tax change that would more effectively curtail (health care) cost growth.” This piece will explain the basics of the Cadillac plan tax, some of the policy and political reasons for its enactment, and why its current precarious status was both predictable and predicted.
Sep 30, 2015

As I noted in my previous MarketWatch column, the Social Security Disability Insurance (SSDI) program faces real and increasingly urgent financial challenges. Absent legislative action to shore up the program's finances, benefits will automatically be cut by almost 20% upon the trust fund's depletion sometime near the end of 2016 — roughly one year from now. Such an outcome would be unconscionable for individuals with disabilities who rely upon this program, and bipartisan action must be taken to avoid it. Unfortunately, differences among policymakers over how best to address this issue have stymied action thus far.
Sep 20, 2015

There is no shortage of ideas on how to improve the federal budget process; it is difficult to get bipartisan agreement on most of them. Some believe budget rules should be easier to execute, to increase the chances lawmakers will abide by them. Others believe rules should be toughened, to force lawmakers to make difficult choices they currently avoid. Inevitably, advocates tend to favor budget rules they believe are more likely to lead to their preferred fiscal policy outcomes, and of course such views are all over the map.
Aug 30, 2015

My usual custom when writing about Medicare and Social Security finances is to simply present the relevant data instead of discussing others’ commentaries about the programs. After this year’s Medicare trustees’ report was released, however, a subsequent Paul Krugman column prompted a number of questions from his readers, suggesting it would be helpful to address Dr. Krugman’s specific assertions.
Aug 17, 2015

In this article, Warshawsky discusses the projected outlook for Social Security and Medicare for 2016, including the forecast insolvency of the disability program and the (un)likelihood of a benefit increase for Social Security recipients.


As I underscored in two recent charts, the Social Security Disability Insurance (SSDI) program is financially unsustainable, and to save it, policymakers need to rein in benefits, which have exploded in recent years. This week’s charts add two important points: first, that SSDI has turned into a quasi-unemployment program, and second, that the good intentions that prompt the creation of federal programs are not enough to prevent poor and costly outcomes.


Charles Blahous is the director of the Spending and Budget Initiative, a senior research fellow at the Mercatus Center at George Mason University and has served as a public trustee for Social Security and Medicare. He specializes in domestic economic policy and retirement security (with an emphasis on Social Security), as well as federal fiscal policy, entitlements, demographic change, and health-care reform.
Brian Blase is a Senior Research Fellow with the Spending and Budget Initiative at the Mercatus Center at George Mason University.
Veronique de Rugy is a senior research fellow at the Mercatus Center at George Mason University and a nationally syndicated columnist. Her primary research interests include the U.S. economy, the federal budget, homeland security, taxation, tax competition, and financial privacy. Her popular weekly charts, published by the Mercatus Center, address economic issues ranging from lessons on creating sustainable economic growth to the implications of government tax and fiscal policies. She has testified numerous times in front of Congress on the effects of fiscal stimulus, debt and deficits, and regulation on the economy.
Jason J. Fichtner is a senior research fellow at the Mercatus Center at George Mason University. His research focuses on Social Security, federal tax policy, federal budget policy, retirement security, and policy proposals to increase saving and investment.
Matthew Mitchell is a senior research fellow at the Mercatus Center at George Mason University, where he is the director of the Project for the Study of American Capitalism. He is also an adjunct professor of economics at Mason. In his writing and research, he specializes in economic freedom and economic growth, public-choice economics, and the economics of government favoritism toward particular businesses.


Douglas Holtz-Eakin | October 08, 2015
Douglas Holtz-Eakin talks incentives for broader healthcare coverage with Tim Farley on POTUS (Sirius XM).

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Please join us for a lunch discussion centered on reform options for the Social Security Disability Insurance program and a path forward to make real change.


Joseph Antos, Charles Blahous, James C. Capretta, Robert Graboyes, Jason J. Fichtner, June O’Neill , Nina Owcharenko , Thomas P. Miller, | Apr 08, 2014
Top experts explain everything you wanted to know about Medicaid—from federal-state financing to potential reforms.

Media Clippings

Charles Blahous | Jun 04, 2014
This excerpt originally appeared in CQ and also appeared Roll Call.
Jason J. Fichtner | Feb 18, 2014
This excerpt originally appeared in MarketWatch.
Jason J. Fichtner | Oct 17, 2013
This excerpt originally appeared in NBC News.
Charles Blahous | Jul 18, 2013
VHHA tried to drive home the point in January with an economic report that projected Virginia would receive $3.9 billion in annual economic benefits and 30,000 jobs, but Charles Blahous, a senior research fellow at George Mason University’s Mercatus Center, said the benefits wouldn’t outweigh the expansion in costs.
Charles Blahous | Jun 14, 2013
Although the continuing increase in medical costs plays a role in the growth of Social Security and health care programs, “demographics is the bigger factor, hands down,” said Charles Blahous, a public trustee for the Social Security and Medicare Boards of Trustees.
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