Stop Bleeding Medicare By Wasting Money on Private Plans
And we quote:
“Private insurers’ Medicare Advantage plans cost Medicare an extra $34.1 billion in 2012
Instead of being more efficient, private insurers have cost Medicare almost $300 billion more over the life of the program
A study published online today finds that the private insurance companies that participate in Medicare under the Medicare Advantage program and its predecessors have cost the publicly funded program for the elderly and disabled an extra $282.6 billion since 1985, most of it over the past eight years. In 2012 alone, private insurers were overpaid $34.1 billion.
That’s wasted money that should have been spent on improving patient care, shoring up Medicare’s trust fund or reducing the federal deficit, the researchers say.
The findings appear in an article published in the International Journal of Health Services by Drs. Ida Hellander, Steffie Woolhandler and David Himmelstein titled “Medicare overpayments to private plans, 1985-2012: Shifting seniors to private plans has already cost Medicare US$282.6 billion.”
Hellander is policy director at Physicians for a National Health Program (PNHP), a nonprofit research and advocacy group. Woolhandler and Himmelstein are professors at the City University of New York School of Public Health, visiting professors at Harvard Medical School and co-founders of PNHP.”
Proposed Home Health Co-Pay is a Big Mistake
We have to say, Forbes has it right! The co-pay for Medicare home health care proposed in the President’s budget is a big mistake. It will not save money, will harm people with chronic conditions, and will increase avoidable hospitalizations. It isn’t even a good tool for fighting fraud – if that is the goal.
Far from getting too much care, our experience is that thousands of people with multiple sclerosis, Parkinson’s disease, ALS, paralysis, and other long-term conditions, struggle to get the home care they DO need. A little bit of nursing and/or therapy, along with hands-on health aide services, often means the difference between staying home and requiring a hospital stay or nursing home placement. For most Medicare beneficiaries with chronic conditions, home health care is more humane, more effective and less expensive.
If fraud is the concern, fight it. Don’t add co-pays or other barriers for those who really do need home care and qualify for Medicare coverage.
Priorities: People – and Medicare – Before Drug Company Profits
As we said in today’s Politico Op Ed, it’s time to support Senator Rockefeller’s bill – and all serious efforts to reduce what Medicare pays for prescription drugs. High time. There are over 50 million people with Medicare. Why would we not insist on lowering drug prices for all of them? It would save Medicare $141 Billion over ten years. Wal-Mart knows the value of negotiating low prices for vast numbers of people, and is sure to do so. So should Medicare.
Why DOMA Matters for Medicare
This week, the Supreme Court is set to hear oral arguments in two cases relating to the Defense of Marriage Act (DOMA), the law prohibiting the federal government from recognizing same-sex marriages. DOMA has serious implications for same-sex couples regarding the benefits they earn, including Medicare. How same-sex couples qualify and pay for Medicare is directly impacted by DOMA – and has serious financial ramifications for these couples.
Access to Medicare is generally achieved by reaching age 65 and accruing 10 years (40 quarters) of Social Security-covered employment, or by being the spouse of a worker who is age 65 who has accrued 40 qualifying quarters. Because the federal government cannot legally recognize the validity of a same-sex married couple under DOMA, same-sex spouses with no work history, or fewer than 40 qualifying quarters, cannot acquire Medicare coverage on the basis of their spouses’ work history. In order to have access to Medicare coverage that would be available to an individual in a mixed-gender marriage, a spouse in a same-sex marriage must pay hefty out-of-pocket premiums to buy into Medicare Part A. In 2013, the monthly Part A premium is $248 for beneficiaries with 30 to 39 quarters of qualifying work history, and $451 for those with less than 30 quarters in the system.
Simply put, DOMA often causes same-sex couples to pay significantly higher out-of-pocket costs for Medicare than they would if they could legally marry in their states and if their marriages were recognized federally. Though some progress has been made by the Department of Health and Human Services in recognizing the rights of same-sex couples regarding hospital visitation, DOMA still presents them with significant barriers to affordable health care under Medicare.
The Supreme Court’s rulings on DOMA will have serious implications for same-sex spouses and their families. Ironically, this is LGBT Health Awareness Week. We hope the Supreme Court will mark the occasion with a decision that recognizes the full and equal rights of Americans in same-sex marriages.
ACA is Good for Medicare!
Misconceptions and misinformation about the Affordable Care Act are still too many to innumerate. However, as advocates for Medicare beneficiaries and a strong Medicare program, we can tell you that the Affordable Care Act (ACA) is good for beneficiaries and good for the stability of a full and fair Medicare program. ACA has already added significantly to Medicare-covered preventive services – with no beneficiary cost-sharing, continues to reduce the cost of prescription drugs for people under Medicare Part D, is phasing out wasteful overpayments to private Medicare Advantage plans and added over a decade to Medicare’s long-term solvency.
Happy Anniversary, ACA. As my grandmother would say, “You should live and be well!”
Ryan Retread: Ideology Trumps Medicare Protection and Deficit Reduction
The Ryan plan for 2013 is the same as the Ryan plan for 2012 and 2011: Privatize Medicare and repeal the Affordable Care Act. Once again the Ryan budget proposes to preserve Medicare in name only. It would change Medicare into a defined voucher system, sending beneficiaries into the marketplace to purchase indiivual insurance plans. These ideas were at the heart of the 2012 election. They are about changing the way government and Medicare work, not about saving Medicare or money. The proposals were rejected at the polls.
If Medicare and the deficit are really our concern, there are real savings possible that would not harm older and disabled people: Bring down the prices Medicare pays for drugs. Stop all overpayments to private Medicare Advantage plans. Add a prescription drug benefit to traditional Medicare. Lower the age of eligibility for Medicare. Let the Affordable Care Act work.
Mr. Ryan, move on! Join us in focusing on real solutions.
Not Saying We Told You So …
The cover story of today’s Time Magazine Special Report agrees with our long-standing call for Medicare to negotiate drug prices and lower the age of Medicare eligibility. Even the CMS Medicare Director agrees that Medicare should negotiate what it pays for drugs. Just seven years ago Medicare didn’t even have a drug benefit – now it’s the largest buyer of drugs in the world!
Congress: It’s time to repeal the Bush-era prohibition against Medicare negotiating on behalf of all its customers. That’s how to drive costs down for Medicare, older people, people with disabilities, and taxpayers.
Wal-Mart does it – Medicare should too!
Benefit Cuts or Drug Discounts?
According to a 2012 Congressional Budget Office report, aligning Medicare drug payments with what Medicaid pays just for low-income beneficiaries would save $137.4 Billion over ten years. (CBO Estimates for President’s Budget for 2013, 3/16/2012).
While the President suggested this reform in his State of the Union address, discounting what Medicare pays for drugs has thus far not been taken seriously by decision-makers.
Instead, we have repeatedly been told that Medicare cannot be sustained and that benefit cuts are necessary. Yet all these Medicare benefit cuts combined would only equal $35.4 Billion in savings over ten years:
1. Increasing income-related Part B premiums;
2. Increasing income-related Part D premiums;
3. Increasing Part B deductible for new enrollees;
4. Adding a Part B premium surcharge for first-dollar Medigap coverage;
5. Adding home health co-pays for new enrollees.
If all of these benefit cuts, that would hurt older and disabled people, save only 25% of the savings that would be achieved by requiring drug companies to give the same discounts to Medicare as it gives to Medicaid, why don’t we choose drug discounts? How can benefit cuts be preferable if the goals are to reduce the deficit and save Medicare for future generations?
Lower Medicare payments for prescription drugs. Choose People and Medicare over PRxOFITS!
Medicare Shoppers: Pay Less for Rx!
Want to lower the costs of Medicare for all beneficiaries and taxpayers? Lower the prices Medicare pays for prescription drugs! Like Medicaid and the Veterans Administration – Medicare should negotiate discounts for all beneficiaries. This would save over $200 Billion over the next 10 years.
It’s time to end the Bush era gift to the pharmaceutical industry, which got 50 million new customers when Medicare began covering drugs in 2006, without being asked to lower prices in return. Walmart and Costco negotiate prices for all their customers, that’s how their customers pay less. Medicare should do no less for its “customers.” Surely older people, people with disabilities and taxpayers deserve the kind of consideration given to Walmart shoppers.
“Check out our website for a full list of solutions that would preserve Medicare coverage while reducing costs to taxpayers.”
New CBO Report Shows Medicare Leading the Way on Lowering Costs
Last week, the Congressional Budget Office released a new budget outlook with updated data on expected federal costs of programs including Medicare and Medicaid over the next ten years. According to the CBO, Medicare spending in 2012 grew by only 3% – the lowest rate of growth in over a decade,[1] and a rate much lower than that of the private market.[2] In fact, the Washington Post notes that “From the March 2010 baseline to the current baseline…[CBO] lowered estimates of federal spending for the two programs in 2020 by about $200 billion — by $126 billion for Medicare and by $78 billion for Medicaid, or by roughly 15 percent for each program”.[3]
The new baseline estimates indicate that Medicare is leading the way in controlling costs, and that Medicare has significantly contributed to lowering the nation’s deficit through innovative payment and delivery models as well as reductions in overpayments to private insurance plans under the Affordable Care Act.[4]
CBO’s outlook illustrates that Medicare is not the problem, but rather the solution that policymakers should look to for addressing the real issue of overall health care costs affecting payers system-wide. While many look to slash Medicare and Medicaid in the name of deficit reduction through proposals like raising Medicare’s eligibility age or fragmenting the program through further means-testing, the CBO estimates reveal that such proposals are not rooted in fiscal policy. As the Post points out, “…$200 billion out of [Medicare and Medicaid] is nothing to sneeze at; that’s about double the revenue the government would generate by raising the Medicare eligibility age from 65 to 67.”
The Center for Medicare Advocacy has long maintained that if policymakers are really concerned about strengthening Medicare and reducing the deficit, cutting benefits is the wrong approach – and new polling shows that over 60% of Americans agree.[5] In fact, 85% of Americans strongly favor one of the Center’s Solutions to reduce the deficit: Requiring drug companies to give the government a better deal on medications for people on Medicare. Whether Congress chooses instead to protect the windfall profits of pharmaceutical companies rather than protecting people living on less than $22,000 a year and rely on Medicare to maintain their health remains to be seen.
[1] Congressional Budget Office, The Budget and Economic Outlook: Fiscal Years 2013 to 2023, available at http://cbo.gov/publication/43907.
[2] http://www.healthcostinstitute.org/news-and-events/press-release-2011-health-care-cost-and-utilization-report
[3] Washington Post, Wonkblog: Three Ways CBO Expects Health Spending to Change. Available at http://www.washingtonpost.com/blogs/wonkblog/wp/2013/02/05/three-ways-cbo-expects-health-spending-to-change/
[4] Center for Medicare Advocacy, Medicare Facts and Fiction: Costs and Spending Edition, available at http://www.medicareadvocacy.org/2013/01/10/medicare-facts-and-fiction-costs-and-spending-edition/
[5] Kaiser Family Foundation and Harvard School of Public Health: The Public’s Health Care Agenda for the 113th Congress, available at http://www.kff.org/kaiserpolls/8405.cfm.
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