Using Systems Dynamics Modeling to Demonstrate the Impact of Medicare Out of Pocket Cost Increases on Medicare Recipient Well-Being

Complex social systems are governed by policies that are designed and implemented by legislators, boards of directors, executives, and government officials. At policy inception, policy designers predict positive impacts on society and minimize known negative impacts, which are often seen as tradeoffs for the greater good of the overall system (Adams, 1976). However, the unknown negative impacts cause unintended consequences. These unintended consequences create gaps in goal-seeking systems trying to stay balanced. The intent of this paper is to gather data, design a model in a sophisticated software package (iThink) and a common software package (excel) to show impact of gaps in large policies such as national healthcare. In particular, I will investigate and model the impacts of increasing out of pocket healthcare costs on the wellbeing of Medicare recipients. I also intend to demonstrate that policy makers could benefit from the use of systems dynamics even if they don't have access to sophisticated modeling software such as iThink by using simpler, more ubiquitous software packages such as excel to model the impact of policy decisions. Currently, policies are created through debates among legislators wherein "one side" may win the debate with some input from the "other side".;Sophisticated modeling software could cost upwards of ;My models (iThink and Excel) both show that increase in out of pocket expense have a substantial impact on the wellbeing of Medicare patients as demonstrated in Figure 28 (iThink) and Figure 38 (Excel). Using a debt level as a proxy for the extra cost of out of pocket expense because Medicare recipients, on a fixed income, must pick up additional spending using debt. Both models show that as debt increases the wellbeing of the recipient decreases therefore we reject the null hypothesis (ai). This indicates that higher out of pocket costs accelerates the reduction of overall health and increases the cost of "policy fixes" for governments in the long run. We also showed through a simple excel analysis that the cost increases within the Medicare Out of Pocket expenses remained the same the 5 year pre and post the implementation of the ACA as indicated in figure 42 therefore we accept the null hypothesis (bi). (Abstract shortened by ProQuest.).