Posts filed under ‘Public Option’
Lower Medicare Age
Lawmakers continue to talk about the future of Medicare as they address the federal deficit, and many of the proposals that have emerged would have horrible repercussions for Medicare beneficiaries and their families. Just last week, Connecticut’s Senator Joe Lieberman suggested raising the eligibility age for Medicare; an unsound idea that would hurt the actuarial balance of the Medicare risk pool. Raising the eligibility age would increase the proportion of older, sicker people in Medicare, while younger, healthier people – and their largely unused premiums – would be excluded. That’s the exact wrong direction, and we at the Center had to respond.
Follow the links below to see our letters in the New York Times and the Washington Post.
http://www.nytimes.com/2011/06/16/opinion/l16krugman.html?_r=2&partner=rssnyt&emc=rss
So – What Would You Do? Real Solutions for Medicare Solvency and Reducing the Deficit
As lawmakers debate the future of Medicare as part of broader efforts to address the federal deficit, proposals have emerged from Congress that would have severe repercussions for beneficiaries and their families.[1] Sound and measured solutions that would protect Medicare coverage while reducing costs to taxpayers have not been seriously addressed. The six solutions we propose would accomplish both of these goals.
These solutions, unlike current proposals, do not shift costs to beneficiaries or completely restructure theMedicare program. They promote choice and competition while shoring up the solvency ofMedicare. Adopting these solutions would be a responsible step in reducing our deficit the right way.
1. Negotiate Drug Prices with Pharmaceutical Companies
The Medicare prescription drug law passed in 2003 prohibits the Secretary of Health and Human Services from negotiating prices with pharmaceutical companies. These companies gained 44 million customers when Medicare began covering prescription drugs, but they did not have to adjust their prices in return. Requiring the Secretary to negotiate drug prices for Medicare would save taxpayers billions of dollars – potentially over $200 billion over ten years.[2] Taxpayers currently pay nearly 70% more for drugs in the Medicare program than through the Veteran’s Administration, which has direct negotiating power.[3] Savings realized from reducingMedicare drug cuts could be used to improve benefits for beneficiaries and reduce the deficit.
2. Stop Paying Private Medicare Plans Anything More Than Traditional Medicare
According to the Medicare Payment Advisory Commission (MedPAC), Medicare pays, on average, 10% more for beneficiaries enrolled in private insurance (Medicare Advantage or MA plans) than for comparable beneficiaries enrolled in traditional Medicare.[4] Despite these extra payments, beneficiaries in private plans who are in poor health, or who have chronic conditions, often have more limitations on coverage than they would under traditional Medicare.[5]
A large portion of the overpayments made to private plans actually goes to insurers rather than to benefit Medicare beneficiaries.[6] Although the Affordable Care Act (ACA) changed the payment formula forMedicare Advantage plans, some plans will continue to be paid as much as 115% of the average traditionalMedicare payment rate for their county when the new rates are fully implemented. MedPAC estimates that by 2017Medicare Advantage payment benchmarks will average 101% of traditionalMedicare. ACA also provides additional payments for plans that receive high quality ratings, increasing the likelihood that some MA plans will continue to be paid more than under traditionalMedicare. Reducing private MA payments to 100% of traditionalMedicare, as MedPAC proposed before the enactment of ACA, will increase the solvency of theMedicare program and curb costs for taxpayers. Private plans simply should not receive higher pay than traditionalMedicare.
3. Include a Drug Benefit in Traditional Medicare
Offering a drug benefit in traditional Medicare would give beneficiaries a choice they do not now have, encourage people to stay in traditional Medicare, and save money for taxpayers. It would also provide an alternative to unchecked private plans that leave many with unexpected high out-of-pocket costs. A drug benefit in traditional Medicare would protect beneficiaries against expensive and sometimes abusive marketing practices. Further, traditional Medicare’s lower administrative costs could free up money for quality care, would result in lower drug prices for beneficiaries, and save taxpayers over $20 billion a year.[7]
4. Extend Medicaid Drug Rebates to Medicare Dual Eligibles
Dual eligibles (people eligible for both Medicare and Medicaid) comprise one-fourth of all Medicare drug users, and are among the most costly beneficiaries. Because Medicare, rather than Medicaid, covers most of their drugs and because Medicare cannot negotiate drug prices, their drugs are not eligible for the same rebates as they would be under the traditional Medicaid program. Extending these rebates for dual eligibles would save at least $30 billion over ten years.[8]
5. Lower the Age of Medicare Eligibility
People between 55 and 65 who are not disabled are currently unable to enroll in Medicare. Lowering the age of eligibility to allow this healthier population to enroll in the Medicare program would add revenue for people who will likely need less care and fewer services than older and disabled enrollees.
6. Let the Affordable Care Act Do Its Job
The Affordable Care Act includes many measures to control costs as well as models for reform that will increase the solvency of the Medicare program and lower the deficit while protecting Medicare’s guaranteed benefits. The Congressional Budget Office estimates that repealing or defunding ACA would add $230 billion to the deficit while ignoring the real issue of rising overall health care costs, which contribute heavily to the growing national debt. ACA includes strong measures to allow CMS to combat fraud, waste, and abuse that will bring down costs, as well as a variety of pilot and demonstration projects that aim to bring better care and quality to beneficiaries.[9] The bipartisan Bowles-Simpson Deficit Commission recommended that these projects be implemented as quickly as possible.[10] Allowing ACA to do its job will create a foundation on which to build by improving care and holding down costs for taxpayers.
Conclusion
Protecting”Medicare by shifting costs from the federal government to beneficiaries and their families – whether through the creation of a voucher program or through measures that would be required by spending caps – is a perversion of Medicare’s original purpose, which was to protect older people and their families from illness and financial ruin due to health care costs. The solutions proposed by the Center forMedicare Advocacy promote financial solvency without doing it at the expense of beneficiaries.
[1]See previous Alerts from the Center, “Why Medicaid Matters to Medicare Beneficiaries and Their Families”, “What Happens to Current Nursing Home Residents if House Budget Resolution Becomes Law?”
[2]National Committee to Preserve Social Security and Medicare, available at http://www.ncpssm.org/pdf/price_negotiation_part_d.pdf
[3]Center for Economic and Policy Research, “Negotiating Prices with Drug Companies Could Save Medicare $30 Billion”, March 2007, available at http://www.cepr.net/index.php/press-releases/press-releases/negotiating-prices-with-drug-companies-could-save-medicare-30-billion.
[4]MedPAC, Report to the Congress, March 2011, Chapter 12 (March 2011), available at http://www.medpac.gov/documents/Mar11_EntireReport.pdf.
[5] Neuman P. Medicare Advantage: Key Issues and Implications for Beneficiaries. Testimony before the House Committee on the Budget, United States House of Representatives, June 28, 2007, available at http://www.allhealth.org/briefingmaterials/NeumanTestimony-830.pdf,
[6] Medicare Payment Advisory Commission. March 2009 Report to Congress, Chapter 3: The Medicare Advantage Program. P. 251-253, available at http://www.medpac.gov/chapters/Mar09_Ch03.pdf.
[7]Senator Dick Durbin, available at http://durbin.senate.gov/public/index.cfm/pressreleases?ID=555cc1e8-cc54-4ead-9d85-d5e6275b3789.
[8]Congressional Budget Office, Letter to Honorable Charles Rangel, available at http://www.cbo.gov/ftpdocs/104xx/doc10464/hr3200.pdf
[9]See previous Alert from the Center, “Combating Fraud, Waste, and Abuse in Health Care.”
[10]The National Commission on Fiscal Responsibility and Reform, “The Moment of Truth,” December 2010.
Politics Trump Health Care for People with Pre-Existing Conditions
The new health reform law encourages states to create or expand existing state high-risk pools as one of the first steps towards insurance market reform and increasing access to health care for people who would not otherwise be able to obtain health insurance. State high risk pools can provide insurance, for example, for people who are receiving Social Security disability benefits but who are in the 24-month waiting period for Medicare.
Citing objections to a “federal takeover” of health care, Georgia’s Insurance Commissioner, John Oxendine, has announced that Georgia will not establish a high-risk pool for its residents with pre-existing conditions. The irony is that the health reform law also provides for the establishment of a federal high risk pool for uninsured people with pre-existing conditions that live in states that don’t have their own risk pool. So, by deciding that Georgia won’t establish its own program, Commissioner Oxendine is guaranteeing a “federal takeover” of health care – Georgia residents who can’t otherwise get insurance will only have the option of insurance through a federal, not state, program.
VG/DC
Thank you! 60 Senators Bring Us One Step Closer to Health Care Reform
True, the bill that passed the Senate is far from perfect. But, can you imagine what the opposition would be saying if the bill met our standards for true health care reform? As it is, the brave Senators who led this battle have endangered their political careers. This includes Senator Chris Dodd (CT), senior Senator from the Center for Medicare Advocacy’s home state.
So we thank Senator Dodd and everyone who worked to get this good bill passed. Here are some highlight’s from Families USA: Manager’s amendment: Providing more competition and affordable choices for Americans ; Manager’s amendment: Improving quality and controlling costs ; Manager’s amendment: Enhancing affordable choices for small businesses .
Get some rest, all! Another big push to provide health care equity awaits us after we ring in 2010.
The Connecticut-Based, Center for Medicare Advocacy, Joins the Washington Post in Applauding our Senior Senator, Chris Dodd, and Apologizes for the Actions of Joe Lieberman, our Junior Senator, to Bar Real Health Reform.
The essay below is from the 12/15/2009 Washington Post:
The heroes of health-care reform
Right on the heels of Joe Lieberman trying to kill the bill because it had a Medicare buy-in proposal, Howard Dean is exhorting Democrats to kill the bill because it doesn’t have a Medicare buy-in proposal. Sigh.
So let this serve as an encomium to Ron Wyden, Tom Harkin, Chuck Schumer, Sherrod Brown, Chris Dodd and Jay Rockefeller, among many others. All of these senators could have been the 60th vote. All of them had issues they believe in and worked for. Chris Dodd built and passed a bill. Sherrod Brown whipped up liberal support for the public option. Chuck Schumer spent countless hours devising compromises and searching for new paths forward. Ron Wyden spent years crafting the Healthy Americans Act, getting a CBO score, pulling together co-sponsors, speaking to activists and industry groups and other legislators. Jay Rockefeller has spent decades on this issue and wasn’t even invited into the Gang of Six process.
But you know what? They’re all still there. Because in the end, this isn’t about them, and though their states and their pet issues might benefit if they tried to make it about them, the process, and thus the result, would be endangered. I’ve said before that the remarkable thing isn’t that Joe Lieberman acts the way he does but that so few join him. The legislative process is given a bad name by the showboats and grandstanders, but the only reason it functions at all is because the vast majority of the participants keep their role in perspective.
If this bill passes, it will not be because Lieberman was pacified. It will be because senators such as Rockefeller, Wyden, Schumer, Harkin, Brown and Dodd swallowed their pride and their passion and allowed him to be pacified. They are the heroes here, and beneath it all, their quiet determination made them the key players.
Photo credit: By Jose Luis Magana/Associated Press
Private Medicare Plans Are Taking You to the Cleaners. Cut the Subsidies Now! And Don’t Repeat This Windfall in Health Care Reform.
| New Report Highlights Medicare Advantage Insurers’ Higher Administrative Spending | |
| Publications | |
| Wednesday, 09 December 2009 11:51 | |
| Today Energy and Commerce Committee Chairman Henry A. Waxman and Oversight and Investigations Subcommittee Chairman Bart Stupak released a new report which found that 34 Medicare Advantage insurers expend significant sums on profits, marketing, and other corporate expenses. Last year, the insurers spent an average of $1,450 per beneficiary on profits, marketing, and other corporate expenses, nearly ten times as much as traditional Medicare spent on administrative expenses per beneficiary.On average, Medicare Advantage insurers spent over 15% of premium revenue on profits, marketing, and other corporate expenses. Two-thirds of the Medicare Advantage insurers surveyed by the Committee had a “medical loss ratio” – the percentage of premium revenues used to pay medical claims – below 85% during at least one of the four years examined. In contrast, traditional Medicare spends 98% of its money on medical care. If all Medicare Advantage plans had spent at least 85% of their premium dollars on medical care from 2005 to 2008, they would have spent an additional $3 billion on medical care for seniors.”Medicare plays a critically important role in insuring that millions of Americans receive the health care they need,” said Rep. Waxman. “But as this report shows, Medicare Advantage insurers are squandering billions of dollars on overhead costs – in fact, they spend ten times the amount per beneficiary as traditional Medicare. Our health care bill includes much needed reforms to the Medicare Advantage payment system. There is no reason for Medicare to pay private insurers more than traditional Medicare pays in any community in the country. That will insure that taxpayer dollars are spent wisely.”"Medicare Advantage was never intended to be a program for insurance companies to pad their corporate expense accounts,” said Rep. Stupak. “Seniors pay Medicare Advantage premiums with the expectation that the money will be used to provide critical medical care – not pay for marketing campaigns and executive bonuses. The disparity between the percentage of premiums used to pay medical claims in traditional Medicare and Medicare Advantage is unacceptable; our seniors deserve better. This report is just the latest example of private insurance companies exploiting the Medicare Advantage system for their own gain.”At the request of Chairman Waxman and Subcommittee Chairman Stupak, the majority Committee staff analyzed premium revenues, medical claim payments, marketing costs, profits, and other data from 34 major Medicare Advantage insurers.
The report found:
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ANSWER to Pop Quiz! Who Said This? About What?
As a spokesman for the AMA, Ronald Reagan said this about the dangers of passing Medicare: “… behind it will come other federal programs that will invade every area of freedom as we have known it in this country. Until one day, as Norman Thomas said, we will awake to find that we have socialism. And if you don’t do this and if I don’t do it, one of these days you and I are going to spend our sunset years telling our children and our children’s children what it once was like in America when men were free.”
Ronald Reagan, our beloved Republican president, said this as a spokesman against Medicare. Now Republicans laud Medicare, say they are its champion, but say that health care reform must not pass as it will lead to socialism and the demise of Medicare. There is little new under the sun!
Tell your senators to vote for health care reform – with a public option. Like Medicare it is desperately needed and, if passed, it too will become a beloved institution.
Someone, someday, will thank you for fighting for it and will praise your senators’ votes.
Connecticut’s Senators, Health Care Reform, and Lessons From Medicare
The Center for Medicare Advocacy is incorporated and headquartered in Connecticut. People from this state can be proud of the courage our senior senator, Chris Dodd, has shown in leading health care reform. As a leader of the Senate’s efforts, Senator Dodd is once again speaking and fighting for real reform, to include a public option. We urge our other Senator, Joe Lieberman, to review the true costs and principles involved in this historic opportunity to insure all Americans, and to vote along with Senator Dodd for real health care reform.
The Center has been representing people with Medicare since 1986. We know what we’re talking about when we talk about the benefits and costs of public health insurance.
Medicare is public health insurance. It brought basic health coverage to older people in 1965, when 50% of people over 65 had NO insurance because the private market didn’t want to insure them. All the arguments being made now against health care reform and a “public option,” were also made against Medicare before it passed. Medicare was hardly bi-partisan legislation; it barely passed.
Now most everyone appreciates Medicare and the health and economic security it brings to older people and their families. We can only hope Congress, and both of our Connecticut senators, will vote courageously again, as those before them did to enact Medicare. This time we call upon Congress to bring health and economic security to younger Americans by voting for health reform – with a public option.
Private Medicare Plans – Bullies On The Playground?
Medicare “Advantage” private plans were created not-equal in 2003. Not equal to “regular Medicare” because the law gave private plans a windfall of about 14% more per covered beneficiary than is paid for the same coverage in regular Medicare. We have all been paying for this – to the tune of about $10 billion a year! So, if paying the private plans the same as the traditional program means they take their balls and go home, so be it. We simply can’t afford to pay for the kind of profit the private plans seem to insist they make at the expense of Medicare and taxpayers.
The Center for Medicare Advocacy has long been concerned about the extraordinary costs of private Medicare. The movement towards fragmenting and privatizing Medicare was advanced by the Medicare Act of 2003.The lessons from privatizing Medicare should be applied when developing health care reform: No matter how much some people may want to believe that the private market is always a more cost-effective model than a public program, it just isn’t so. Medicare proves the point.
• When Medicare private plans were paid 95% of what it costs to provide the same coverage in the public Medicare program, they left the program in droves. They couldn’t make enough profit. (“Medicare+Choice,” enacted in 1997 as part of the Balanced Budget Act of 1997.)
• Under the “Medicare Advantage” program, passed in 2003, private Medicare plans are paid about 14% more than the same coverage would cost in the traditional public Medicare program. And, not surprisingly, private insurance plans have flocked back into the system. The insurance industry is making a windfall from this system – at the expense of all Medicare beneficiaries, including the vast majority of beneficiaries who still choose “regular Medicare.” Taxpayers overpay too. (CBO, MedPAC, Commonwealth Fund.)
• The private Medicare plan program is bleeding the Medicare trust fund, reducing Medicare’s solvency by about 8 years.
If Congress passes a requirement that all Americans have health insurance, but does not provide for a public option, we will have been taken to the cleaners yet again. Private insurance will gain tens of millions of new customers and we taxpayers will all pay a much higher bill than is necessary. Medicare’s experience proves this.
Meeting With The First Lady About Health Reform
Like many of you, I am a mother, a wife, a daughter – and now, amazingly, a grandmother. I am also a lawyer and I run this small business, the Center for Medicare Advocacy. The Center is a non-profit organization founded in 1986. We represent older and disabled people with the focused mission to ensure fair access to Medicare and quality health care. So I know something about advocating for health coverage.
Michelle Obama is hosting a meeting about health care reform and women on November 13th. Wonderfully, the Center has been invited to participate. So tomorrow I’m going to Washington to tell my story to the First Lady.
I’m healthy. I tend not to catch the various viruses that run through my office and community. I exercise, eat a largely vegetarian diet, live an engaged life, and get the recommended medical and dental check ups.
So I was taken by surprise when I was diagnosed with Breast Cancer four years ago. I had a mammogram just a few months earlier. But the bottom line is, stuff happens. We’re all human, and human beings get sick, even if they do “all the right things,” and take care of themselves. From a person who rarely saw doctors, I became a full-time patient. Even now, four years later, I am involved with treatments and tests far more than I like.
It is silly to suggest that people over-utilize health care because they have health insurance. Yes, my insurance covered most of my care. But many of these tests and “procedures” are painful and many of the medications have dreadful side-effects. No one would choose this.
On the other hand, a lack of insurance authorization almost led me to skip important care. However, because I knew how to pursue an appeal, I obtained authorization and proceeded with the treatment – a good decision since I almost needed a transfusion even with them.
I continue to be faced with decisions about follow up treatment and insurance coverage obstacles. I have had to urge my doctors to make their best medical decisions and to leave the insurance battles to me. But if I were not a lawyer who has been fighting for proper health insurance for other people for 30 years, I might not be getting the treatments I need.
My story is only different from everyone else’s because I do have insurance and because I am a professional advocate. We all get sick, we all get injured. But we don’t all have insurance, and we aren’t all health care lawyers.
All women, all people, need health care and we all need help paying for it. This is particularly a woman’s issue because we live longer with more chronic conditions than men and because we are often primary caregivers – for our kids, our spouses, and our parents, all of whom get sick.
I’m telling my story because I’m told it may help. Tell yours too. We need quality health coverage – including a public option – for everyone. I know this as a woman, a patient, and an advocate. As the First Lady suggests, we need to make our voices heard now.
Urge Congress to seize this opportunity to provide health care security for everyone. Pass health care reform this year!
