A New Day Dawns for Oversight of Private Medicare Plans

May 7, 2009 at 7:23 pm Leave a comment

With the advent of the Obama Administration, we have seen a new philosophy towards the private insurance plans that contract with Medicare under the Medicare Part C (Medicare Advantage) and Medicare Part D (prescription drug) programs.

No longer will the Medicare agency “partner” with the Medicare Advantage and prescription drug plans “to design and provide a variety of high quality health care products…..” as the agency said in 2009. This Administration is not about partnering with the private entities that it pays to provide health coverage to Medicare beneficiaries. Instead, Medicare will be looking closely at how these plans operate and what they do with the billions of federal dollars they receive. For example:

• Medicare has told current and potential Part C and Part D plan sponsors that it will no longer accept (during the application process for 2010) the incomplete applications, blank documents and spread sheets, and late filings that it has accepted in past years.

• Medicare announced that it is reducing Medicare Advantage payments for 2010 to account for “up-coding” by Medicare Advantage plans. Plans “up-code” the disease codes for their enrollees, i.e., claim that their enrollees have gotten sicker, in order to receive higher payments. The problem is that the private Medicare Advantage plans claimed an increase that was actually greater than the increase for the Medicare population.

• The President’s budget, released today, May 7, 2009, includes a focus on private Medicare plans and additional funding for greater oversight of the Medicare Advantage and Medicare prescription drug plans, as part of the overall effort to reduce fraud, waste and abuse in the federal government.

These changes are good for the fiscal integrity of the Medicare program, for the older people and people with disabilities who are served by the program, and for all Americans. What a breath of fresh air.

Entry filed under: Medicare, Public vs. Private Health Coverage. Tags: , , .

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May 2009


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