Welcome to DU!
The truly grassroots left-of-center political community where regular people, not algorithms, drive the discussions and set the standards.
Join the community:
Create a free account
Support DU (and get rid of ads!):
Become a Star Member
Latest Breaking News
General Discussion
The DU Lounge
All Forums
Issue Forums
Culture Forums
Alliance Forums
Region Forums
Support Forums
Help & Search
Medicare Overpayment[s] to Private Plans
Medicare OverpaymentS to Private Plans
<...>
Overpayment
How much more do they get paid? The Medicare Payment Advisory Commission (MedPAC), an independent federal body established by the BBA to advise Congress, released its annual “Report to Congress” on March 1, 2007. Their analysis indicates that benchmarks are 116% of the average Medicare FFS expenditures and payments to plans are 112% of the average Medicare FFS expenditures. Brian Biles, MD, MPH, a professor in the Department of Health Policy at George Washington University, and his colleagues recently released a report through The Commonwealth Fund. Their analysis found that payments to MA plans averaged 12.4% more than costs in traditional Medicare during 2005. If Congress were to eliminate these overpayments by setting the benchmarks in each county equal to per capita FFS spending, the CBO estimates that Medicare would save $8.1 billion in 2008 and $159.8 billion through 2017.
HMO’s are not the only private plans participating in Medicare. Other plans include Local and Regional Preferred Provider Organizations (PPOs), Private Fee-for-Service plans (PFFS), and Special Needs Plans (SNPs). Insurance companies have continued to offer private plans in more areas and now at least one private plan alternative is available to every Medicare beneficiary.
PFFS is the fastest-growing plan type, accounting for 46% of total enrollment growth from December 2005 to July 2006. PFFS was available to 45% of beneficiaries in 2005 and is now available to almost 100% of beneficiaries. Payments to PFFS plans are 119% of the per capita Medicare FFS expenditures. It is no wonder that PFFS plans are growing at such a rapid rate.
Arguments from the Plans
Many members of Congress have begun to seize on these overpayments to private plans as a significant source of potential savings for Medicare. Not surprisingly, the private insurance plans are very concerned that they might lose billions of dollars.
The plans have argued that cutting funding to the MA plans would hurt low-income beneficiaries. We agree that low-income beneficiaries need extra help the most. Medicare provides help to low-income beneficiaries in the form of Medicare Savings Programs (MSPs). These programs reduce out-of-pocket expenses for individuals with incomes below 135% of the Federal Poverty Level, but these programs could use an expansion. The savings from MA plans could be used to provide more benefits to more low-income beneficiaries, not just those who choose to enroll in an MA plan.
Private plans have also pointed out that people who enroll in an MA plan receive more benefits than are offered by traditional Medicare. It is obvious that beneficiaries should receive as many benefits as possible, but those benefits should be distributed equitably. Why limit extra benefits to just the beneficiaries who enroll in MA plans, and how significant are these additional benefits, actually? These services should, and could with efficient spending, be available to all Medicare beneficiaries.
Conclusion
MA plans may offer some beneficiaries a useful Medicare coverage choice. But the payments to these plans must be financially neutral when compared to the costs of traditional Medicare. The Medicare Trustees will soon issue their annual report, and will inevitably raise alarms that Medicare is in financial peril. Removing overpayments to MA plans is a clear way to save Medicare hundreds of billions of dollars and make the program more equitable in the process, ensuring fair access to health care for millions of older people and people with disabilities, now and in the future.
http://www.medicareadvocacy.org/News/Archives/MA_Overpayments.htm
<...>
Overpayment
How much more do they get paid? The Medicare Payment Advisory Commission (MedPAC), an independent federal body established by the BBA to advise Congress, released its annual “Report to Congress” on March 1, 2007. Their analysis indicates that benchmarks are 116% of the average Medicare FFS expenditures and payments to plans are 112% of the average Medicare FFS expenditures. Brian Biles, MD, MPH, a professor in the Department of Health Policy at George Washington University, and his colleagues recently released a report through The Commonwealth Fund. Their analysis found that payments to MA plans averaged 12.4% more than costs in traditional Medicare during 2005. If Congress were to eliminate these overpayments by setting the benchmarks in each county equal to per capita FFS spending, the CBO estimates that Medicare would save $8.1 billion in 2008 and $159.8 billion through 2017.
HMO’s are not the only private plans participating in Medicare. Other plans include Local and Regional Preferred Provider Organizations (PPOs), Private Fee-for-Service plans (PFFS), and Special Needs Plans (SNPs). Insurance companies have continued to offer private plans in more areas and now at least one private plan alternative is available to every Medicare beneficiary.
PFFS is the fastest-growing plan type, accounting for 46% of total enrollment growth from December 2005 to July 2006. PFFS was available to 45% of beneficiaries in 2005 and is now available to almost 100% of beneficiaries. Payments to PFFS plans are 119% of the per capita Medicare FFS expenditures. It is no wonder that PFFS plans are growing at such a rapid rate.
Arguments from the Plans
Many members of Congress have begun to seize on these overpayments to private plans as a significant source of potential savings for Medicare. Not surprisingly, the private insurance plans are very concerned that they might lose billions of dollars.
The plans have argued that cutting funding to the MA plans would hurt low-income beneficiaries. We agree that low-income beneficiaries need extra help the most. Medicare provides help to low-income beneficiaries in the form of Medicare Savings Programs (MSPs). These programs reduce out-of-pocket expenses for individuals with incomes below 135% of the Federal Poverty Level, but these programs could use an expansion. The savings from MA plans could be used to provide more benefits to more low-income beneficiaries, not just those who choose to enroll in an MA plan.
Private plans have also pointed out that people who enroll in an MA plan receive more benefits than are offered by traditional Medicare. It is obvious that beneficiaries should receive as many benefits as possible, but those benefits should be distributed equitably. Why limit extra benefits to just the beneficiaries who enroll in MA plans, and how significant are these additional benefits, actually? These services should, and could with efficient spending, be available to all Medicare beneficiaries.
Conclusion
MA plans may offer some beneficiaries a useful Medicare coverage choice. But the payments to these plans must be financially neutral when compared to the costs of traditional Medicare. The Medicare Trustees will soon issue their annual report, and will inevitably raise alarms that Medicare is in financial peril. Removing overpayments to MA plans is a clear way to save Medicare hundreds of billions of dollars and make the program more equitable in the process, ensuring fair access to health care for millions of older people and people with disabilities, now and in the future.
http://www.medicareadvocacy.org/News/Archives/MA_Overpayments.htm
Anyone who wants to see traditional Medicare squeezed out by private insurers will continue to support Medicare Advantage. The plans are putting a strain on Medicare budgets and driving up costs.
Medicare Advantage and the ‘Theft’ of $156 Billion
By UWE E. REINHARDT
In a Dec. 27 lead editorial, “Government Advantage,” the editorial writers of The Wall Street Journal wrote:
A theft of $156 billion should catch one’s attention, especially if government is the thief. It warrants a closer look...what is the time frame of this $156 billion “theft”? Greater clarity on this point would have been helpful, lest readers think that this is an annual figure. In fact, it is the sum of projected future annual cuts off projected future total payments to Medicare Advantage plans over the decade 2013-2022 (see line 8 of Table 2, page 5 in this Congressional Budget Office projection).
That point aside, what the Affordable Care Act has done to the Medicare Advantage plans lies, like beauty, in the eyes of the beholder.
The story begins with the Medicare Prescription Drug Improvement and Modernization Act of 2003, which revamped the manner in which Medicare paid private health plans for Medicare beneficiaries who chose them in lieu of traditional Medicare. The program, called Medicare Risk when it was established in 1982 and rechristened Medicare+Choice in 1997, was reborn as Medicare Advantage.
I described and discussed the complicated administrative payment algorithm prescribed for Medicare Advantage by that law in a previous post. Those interested in the modus operandi of the payment system for Medicare Advantage before the Affordable Care Act of 2010 can read an official description by the Medicare Payment Advisory Commission of Congress (known as Medpac), dated October 2008. A description of the current payment system is also available...on average, the payment method prescribed by the 2003 law, which took effect in 2006, has cost taxpayers substantially more per Medicare beneficiary who enrolled in a Medicare Advantage plan than these beneficiaries would have cost taxpayers in traditional Medicare. That is because Medicare has paid private plans more per beneficiary than these beneficiaries would have cost in traditional Medicare.
- more -
http://economix.blogs.nytimes.com/2014/01/03/medicare-advantage-and-the-theft-of-156-billion
By UWE E. REINHARDT
In a Dec. 27 lead editorial, “Government Advantage,” the editorial writers of The Wall Street Journal wrote:
Amid the larger ObamaCare meltdown, seniors are discovering their choices are fewer, costs higher and coverage poorer too. Liberals fear the increasing popularity of Medicare Advantage, and they’re starting to gut this market alternative to their original health care entitlement before the sand runs out on President Obama’s second term. About 14 million people or 28 percent of Medicare beneficiaries choose Advantage over the government option, which is why the Affordable Care Act steals about $156 billion from the program – even as enrollment has surged 30 percent since 2010.
A theft of $156 billion should catch one’s attention, especially if government is the thief. It warrants a closer look...what is the time frame of this $156 billion “theft”? Greater clarity on this point would have been helpful, lest readers think that this is an annual figure. In fact, it is the sum of projected future annual cuts off projected future total payments to Medicare Advantage plans over the decade 2013-2022 (see line 8 of Table 2, page 5 in this Congressional Budget Office projection).
That point aside, what the Affordable Care Act has done to the Medicare Advantage plans lies, like beauty, in the eyes of the beholder.
The story begins with the Medicare Prescription Drug Improvement and Modernization Act of 2003, which revamped the manner in which Medicare paid private health plans for Medicare beneficiaries who chose them in lieu of traditional Medicare. The program, called Medicare Risk when it was established in 1982 and rechristened Medicare+Choice in 1997, was reborn as Medicare Advantage.
I described and discussed the complicated administrative payment algorithm prescribed for Medicare Advantage by that law in a previous post. Those interested in the modus operandi of the payment system for Medicare Advantage before the Affordable Care Act of 2010 can read an official description by the Medicare Payment Advisory Commission of Congress (known as Medpac), dated October 2008. A description of the current payment system is also available...on average, the payment method prescribed by the 2003 law, which took effect in 2006, has cost taxpayers substantially more per Medicare beneficiary who enrolled in a Medicare Advantage plan than these beneficiaries would have cost taxpayers in traditional Medicare. That is because Medicare has paid private plans more per beneficiary than these beneficiaries would have cost in traditional Medicare.
- more -
http://economix.blogs.nytimes.com/2014/01/03/medicare-advantage-and-the-theft-of-156-billion
Typical Republican scam: Undermine Medicare by diverting a substantial amount of Medicare funds to private insurance.
While the WSJ is attempting to push this bogus claim, the health care law also strengthened Medicare.
<...>
MEDICARE’S FINANCIAL CONDITION
Medicare’s financial condition is measured in several ways, including the solvency of the Part A Trust Fund, the annual growth in spending, and growth in spending on a per capita basis. Average annual growth in total Medicare spending is projected to be 6.6% between 2010 and 2019, but 3.5% on a per capita basis (assuming no reduction in physician fees).
The Part A Trust Fund is projected to be depleted in 2024— eight years longer than in the absence of the health reform law—at which point Medicare would not have sufficient funds to pay full benefits, even though revenue flows into the Trust Fund each year. Part A Trust Fund solvency is affected by growth in the economy, which directly affects revenue from payroll tax contributions, and by demographic trends: an increasing number of beneficiaries, especially between 2010 and 2030 when the baby boom generation reaches Medicare eligibility age, and a declining ratio of workers per beneficiary making payroll contributions (Figure 4).
<...>
http://www.kff.org/medicare/upload/7305-06.pdf
MEDICARE’S FINANCIAL CONDITION
Medicare’s financial condition is measured in several ways, including the solvency of the Part A Trust Fund, the annual growth in spending, and growth in spending on a per capita basis. Average annual growth in total Medicare spending is projected to be 6.6% between 2010 and 2019, but 3.5% on a per capita basis (assuming no reduction in physician fees).
The Part A Trust Fund is projected to be depleted in 2024— eight years longer than in the absence of the health reform law—at which point Medicare would not have sufficient funds to pay full benefits, even though revenue flows into the Trust Fund each year. Part A Trust Fund solvency is affected by growth in the economy, which directly affects revenue from payroll tax contributions, and by demographic trends: an increasing number of beneficiaries, especially between 2010 and 2030 when the baby boom generation reaches Medicare eligibility age, and a declining ratio of workers per beneficiary making payroll contributions (Figure 4).
<...>
http://www.kff.org/medicare/upload/7305-06.pdf
http://www.democraticunderground.com/10024270235
5 replies
= new reply since forum marked as read
= new reply since forum marked as read
to the ads the repukes put out this ELECTION YEAR, trumpeting that the democrats are going to slash Medicare.
You are cute.
bwahahahahaha.