Heritage Foundation Leadership for America

Lawmakers just can’t go willy-nilly while reforming Medicare.

When they do, you wind up with proposals such as adding prescription drugs as a Medicare entitlement—an idea costing taxpayers at least $400 billion.

True Medicare reform must move the 38-year-old program away from its central, one-size-fits-all approach toward one that offers choice and competition. To achieve this, government must follow nine tests, economist Walton Francis writes in an Aug. 7 paper for The Heritage Foundation. They are:

1) Follow clear, simple rules for changing Medicare.

2) Establish a predictable level of Medicare financing that’s reasonable.

3) Allow health plans to decide benefit and coverage details.

4) Allow flexible areas for Medicare service.

5) Exempt competing Medicare plans from state mandates.

6) Establish a sensible Medicare budget strategy.

7) Detailed Medicare regulations should be almost nonexistent.

8) Encourage employer health plans to participate fully in the reformed Medicare.

9) Encourage and allow the Federal Employee Health Benefit Plan to participate.

Read more of Francis’ paper and other Heritage Medicare research at heritage.org.