Representative John Ryan (R-WI), the chairman of the House Budget Committee, released a budget plan last week that would dramatically change Medicare and Medicaid.  Ryan suggests making Medicaid into a block grant program whereby states are given a set amount of money to spend on providing health care each year and are given greater flexibility.  For Medicare, Ryan's plan suggests a voucher-esque program starting in 2022 that would ask wealthier older Americans to pay a larger share of their Medicare bill, would increase the eligibility age to 67, and would provide beneficiaries with a set amount of money to spend on their own care, which many experts suggest will not keep pace with the rising cost of health care, thus shifting costs to Medicare beneficiaries.

The Center on Budget and Policy Priorities (CBPP) is skeptical, suggesting that 2/3 of the cuts in Ryan's plan would fall on poor Americans and that the $4.3 trillion in budget cuts would be offset by $4.2 trillion in tax cuts that would disproportionately benefit the wealthy. CBPP also projects that if Ryan's plan would have been enacted in 2000, then 29 states would have experienced cuts in federal Medicaid funding of 30% or more by 2009.  Thirty-five organizations signed onto a letter to Congress suggesting that block-granting Medicaid would harm older Americans and people with disabilities by removing current federal protections like those that prevent spousal impoverishment in Medicaid.  Families USA opposes the plan and highlighted the fact that Medicaid is currently the primary payer for 64% of all nursing home residents and also provides home-based care to millions of seniors and people with disabilities.  The New York Times highlighted research that suggests the current Medicare program acts mostly as a welfare program for most Americans who will receive a far higher value of benefits than they have paid for through their Medicare payroll tax deductions.  The Times also chides Ryan and other politicians for not asking current baby boomers and older Americans to help pay for changes to this and other government programs (Ryan's Medicare changes wouldn't take effect until 2022).  For more information, visit:

The Kaiser Family Foundation released three policy briefs that analyze the income, assets, and out-of-pocket expenses for current and future Medicare beneficiaries.  

A Canadian program serving the Onedia Nation of the Thames in Canada was recently profiled for its approach of tailoring Alzheimer's care.  For example, the director of the program, Robin Shawanoo, explains that he conducts memory tests and ask participants to name the similarities between corn and squash, in contrast to colleagues in nearby London, Ontario, who ask participants about differences in a watch and a ruler.  Dr. Kristen Jacklin is heading a research project into dementia in Aboriginal communities and explains that Aboriginal communities have " a much more natural perception of the illness and one that is more accepting than mainstream society" and that First Nations communities view dementia as a natural, and often sacred, part of the aging process.  In addition to incorporating Aboriginal symbols into dementia tests, Shawanoo also incorporates the culture into treatment and care by working with medicine people, using healing ceremonies and using sage.  Shawanoo also suggests the importance of honoring the Aboriginal culture by recognizing not only the individual with Alzheimer's, but also their place within their family and community.  For more information, visit:

A recent study of 377 mostly male veterans age 65 or older who were taking five or more medications found that frailty in elderly patients is not associated with an increased risk of adverse reactions to medications.  The lead author, Dr. Michael Steinman, explains that there is a common and reasonable perception among doctors that older people who need assistance with activities of daily living are more vulnerable to adverse reactions to medications.  However, using multivariate analysis, the authors found that adverse drug reaction was most strongly correlated with the number of new medications a patient is taking, not the patient's frailty. The authors conclude "although it is important to consider the unique circumstances of each participant, excessive caution in prescribing to older adults with these geriatric conditions may not be warranted." For more information, visit:

A recent article in the Annals of Long Term Care provides an excellent guide for doctors and other professionals who are facilitating conversations with families about their loved ones who are receiving care in a long-term care setting.  The authors discuss three strategies for holding the meetings, suggest timing considerations and provide a step-by-step process chart to conduct a family meeting.  The strategies for holding the meetings are based on past research conducted on successful communication between doctors and families.  Next Step In Care also released two guides: "Leaving hospital and going where?" that is designed for family caregivers as well as a similar guide intended for providers. The guides explain rights and responsibilities, provide planning suggestions, and are available in English, Spanish, Chinese and Russian.  For more information, visit:

A recent AARP research brief calls into question whether or not competition from generic drugs actually translates into lower prices for consumers.  Using a "market basket" of 217 drugs that are widely used by Medicare Part D beneficiaries, the authors analyzed price increases for "brand name" drugs before and after the drugs went "off patent" and faced generic competition.  While generic drug prices are on average 85% lower than the price of their brand name counterparts, drug manufacturers can delay their competitor's entry through "pay for delay" agreements with the first generic manufacturer who files for FDA approval, a trend that costs the American public $3.5 billion a year due to delays of price competition.   

AARP has monitored drug price increases for this market basket since 2004 and finds that brand name drugs that are facing generic competition dramatically increase their prices in the year or two before the generic drug enters the market.  For example, the 15 brand name drugs facing competition in 2010 increased their annual retail prices by 13.7%, which is higher than the 8.3% increase in 2009 for the entire market basket of drugs.  Brand name drugs that faced generic competition in 2010 increased their retail prices by 51% from 2004 to 2010 (from $1,842 to $2,610 for a year of therapy).  For brand name drugs that faced generic competition prior to 2006, retail prices still rose about 30% (or 5.5% a year) between 2005 and 2009.  This trends appears counterintuitive because the brand-name drugs should have lowered prices (not raised) when facing generic competition.  

Higher drug prices translate to higher out-of-pocket costs for beneficiaries who pay a percentage of their drug costs (coinsurance) rather than a fixed amount (copayment) and also push more Medicare Part D enrollees into the "doughnut hole" where they must pay all or most of their drug costs each year.  The Affordable Care Act has provisions to phase out the coverage gap, but not until 2020.  The Kaiser report summarized earlier in this issue of PolicyDigest found that the average out-of-pocket health care expenditures (not just drugs) per Medicare beneficiary was $4,241 in 2006.  The AARP report also includes a brief video summary of the report findings.  For more information, visit: