Policy Recommendations for Medicare & Medicaid Restructuring

Restructure Medicare & Medicaid: Social Factors—Possible Solutions Boost Healthcare Education & Incentives to Drive Better Choices e Emphasize on disease prevention and wellness. — Education and information — Highlight health risk associated with certain behaviors and lifestyles — Financial incentives for healthy habits — Create social programs to champion healthy lifestyles and consumption — Subsidize healthy foods for lower income population Discourage unhealthy behavior and consumption. — Penalize poor health choices (create new incentives based upon lessons learned from higher life insurance fees for smokers and car insurance fees for speeders) — Consider additional / new taxes on cigarettes, non-diet sodas, etc. KP Source: Morgan Stanley Healthcare Research. www.kpcb.com USA Inc. | What Might a Turnaround Expert Consider? 291 Restructure Medicare & Medicaid: Economic Forces that Push Up Healthcare Spending 1) Open access healthcare plans can increase access to care (via greater choices of care providers), but can also increase cost. 2) Consumers and providers are not always incentivized to constrain their healthcare costs. 3) Even when appropriate, poor information & lack of price transparency complicate comparison shopping for consumers. 4) Advances in medical technology drive demand and costs. KP www.kpcb.com USA Inc. | What Might a Turnaround Expert Consider? 292 HOUSE_OVERSIGHT_020987