Fundamental Changes To Medicare Proposed By Elder Law Expert

House Budget Committee Chairman Paul Ryan's proposal to change Medicare for those under age 55 is nothing short of a complete reconceptualization of the health insurance program, says a University of Illinois elder law expert.

Richard L. Kaplan, a professor of law and expert on retirement issues, says the Ryan proposal would scrap Medicare's current defined-benefit program in favor of a defined-contribution arrangement in which the government would provide seniors with a stipulated amount of money to purchase health insurance from private insurers.

"The Ryan proposal would eliminate the package of benefits that everyone receives but would allow seniors to choose from a variety of plans with different benefits, different premiums and different co-payment obligations," Kaplan said.

Kaplan, the Peer and Sarah Pedersen Professor of Law at Illinois, says that what Rep. Ryan is proposing isn't a radically new idea, as a broadly similar plan was first considered at length during the Clinton administration.

"It was proposed under the title of 'premium support,' though occasionally it has been described as vouchers," he said. "Essentially, it's the same concept - provide seniors with a designated amount of money and let them shop for the plan that best meets their needs."

While there may be nothing new under the sun in Washington, that doesn't mean that some seniors won't come out ahead under the Ryan proposal.

"Some seniors will benefit, because they will be able to use their Medicare dollars for benefits that they prefer," Kaplan said. "For example, Medicare currently pays for individual hospital stays of 60 to 90 days in length. But the average hospital stay for someone 65 years and older is less than six days. So a prospective Medicare enrollee might choose a plan in the proposed system that provides shorter hospital stay coverage but more extensive home health care coverage than Medicare currently includes."

The chief motivator of the Ryan plan is to, plain and simple, save the government money, Kaplan said.

"As medical costs increase, Medicare's costs rise accordingly," he said. "Under the Ryan plan, Medicare's costs would be fixed and known in advance. Increases in medical costs over whatever cost-of-living increase the government dictates for Medicare will not be borne by Medicare, but by those seniors who choose more comprehensive benefit plans."

Although last year's health care reform law left the basic structure of Medicare intact, the Ryan proposal would transform Medicare to make it resemble the types of health insurance plans that many employers offer to their employees. Although this would represent a dramatic change, Kaplan said, such changes to Medicare are not wholly unprecedented.

"Actually, Medicare Part D, which provides coverage for prescription drugs, operates on a very similar basis - private insurers receive government subsidies to provide various drug plans, and seniors select among the options that are available, paying more for greater coverage," Kaplan said.

But in a different health insurance paradigm, the downside is that seniors will almost certainly face more complexity.

"If our experience with Medicare Part D's drug plans is any indication, older Americans will confront a new array of insurance plans under Medicare, some of which may change their components annually," Kaplan said.

But Kaplan is quick to note that the present system is no walk in the park either.

"Presently, most seniors sign up for hospital coverage under Medicare Part A, then decide whether they want to purchase Medicare Part B coverage for physicians' charges, and then decide whether to add a Medicare Part D plan to cover their prescription medication needs," he said. " Then they must consider whether to buy a private Medigap insurance plan to pay for the deductibles and co-payment or co-insurance obligations of Medicare Parts A and B. So, in many ways, the new system of integrated benefit plans will be simpler and more intuitive. But the transition to this new environment will certainly be challenging."

Not all seniors will be affected by the change; adults 55 years and older would be largely unaffected by Ryan's proposal, Kaplan said.

"Unless an option is provided to let them switch, which may or may not be incorporated into the final plan, anyone who is in Medicare presently will not be affected by his proposal," Kaplan said. "Those seniors who are already familiar with Medicare's component parts need not bother with this legislation."

Source:
Phil Ciciora
University of Illinois at Urbana-Champaign

AARP Bulletin Offers The Medicare Starter Kit

Image via WikipediaMore than 70 million people will become eligible for Medicare in the next two decades, and beginning this year, one boomer will turn 65 every eight seconds. But many Boomers know zip about Medicare. Do you need it? What does it cover? When should you sign up?

Because Medicare is not a “one size fits all” insurance program, the April issue of AARP Bulletin (in homes tomorrow) offers readers the Medicare Starter Kit—a special eight-page insert to help Boomers navigate the options and determine what the best next step for them may be.

Available online NOW at http://www.aarp.org/health/medicare-insurance/info-04-2011/medicare-starter-guide.html AARP Bulletin breaks down:

- The Top Eight Do's and Don'ts of Medicare
- What Medicare Covers and What it Costs
- How to Qualify and When to Enroll
- Figuring Out Your Choices
- Where to get help

Improvements to Medicare Health and Drug Plans

AARP Press Release

WASHINGTON—AARP today submitted comments on regulations proposed by the Centers for Medicare and Medicaid Services (CMS). Many of the proposed regulations for Medicare health and prescription drug plans could improve care, lower costs and simplify enrollment for people in Medicare.

AARP Legislative Policy Director David Certner, the author of the comments, said: “We applaud CMS for working to continually improve the Medicare plans that millions of seniors rely on. While we recommend several areas to strengthen these regulations, on the whole, they will simplify and improve the plans available to people in Medicare.”

Excerpts from AARP’s letter to CMS follow:

On simplifying election periods for Medicare health and drug plans: “AARP strongly supports efforts to simplify beneficiary enrollment for Parts C and D. However, AARP is concerned that this change could result in beneficiary confusion and/or missed enrollment opportunities unless it is widely and effectively promoted. Therefore, AARP urges CMS to work with plan sponsors and beneficiary advocates to develop a public education campaign that will help ensure that all beneficiaries are aware of the new dates for the annual coordinated election period. AARP further believes that Congress should put Medicare fee-for-service and MA on a level playing field by creating an open enrollment period that makes all Medigap products available without regard to health status or pre-existing conditions.”

On income-related Part D premiums: “AARP did not support imposing an income-related premium in the Medicare Part D program. AARP has concerns about the potentially adverse effect of the income related Part D premium on the Part D program and its enrollees…. Nevertheless, we commend CMS for its efforts to develop timely regulations to implement the ACA provision. We are particularly supportive of the proposal in the NPRM to give Medicare beneficiaries a 3-month grace period, and an extension of the grace period for good cause, to pay the Part D Income-Related Monthly Adjustment Amount before their coverage could be terminated.”

On eliminating Part D cost-sharing for “dual eligibles” receiving care at home: “AARP supports the promulgation of this provision, which will create equity in Part D cost-sharing between institutionalized full-benefit dual eligibles and full-benefit dual eligibles receiving substantially the same services in the community.”

On Medicare Advantage cost-sharing for covered preventive care: “AARP strongly supports requiring [MA plans], including section 1876 cost plans, to provide preventive benefits at zero cost-sharing. This measure would align policy for the MA program with the FFS Medicare requirements. It makes sense in terms of providing appropriate incentives to MA enrollees to obtain preventive services and should have the longer term effect of improving health outcomes for the Medicare population.”

To obtain a complete copy of AARP’s letter to CMS, please contact AARP Media Relations at 202-434-2560 or media@aarp.org.

New Disenrollment Period Offers Some Medicare Consumers One More Chance To Change Their Health Coverage

-- Consumers Should Carefully Review Their Options Before Making a Change --

New York, NY—Medicare consumers who are enrolled in Medicare private health plans, commonly known as Medicare Advantage plans, and who become dissatisfied with their choice, can disenroll during the Medicare Advantage Disenrollment Period (MADP), which runs from January 1 to February 14. Consumers who disenroll from their private plan can switch only to Original Medicare—the traditional Medicare program administered by the federal government. Most people who switch to Original Medicare can also change their Medicare prescription drug coverage. The MADP replaces the Open Enrollment Period, which ran from January 1 to March 31 in past years.

“People with Medicare who become unhappy with their Medicare Advantage plan have one more opportunity to change their coverage before being locked in until next fall,” said Joe Baker, president of the Medicare Rights Center. “Because the window is shorter than in past years, consumers should review their coverage options carefully and consider all of the implications of making a change before doing so.”

What are my options during the Medicare Advantage Disenrollment Period? If you have: A Medicare Advantage private health plan with prescription drug coverage, you can switch to Original Medicare plus a prescription drug plan OR Original Medicare without a prescription drug plan A Medicare Advantage Private Fee-For-Service (PFFS) plan that does not include prescription drug coverage and a stand-alone prescription drug plan, you can switch to Original Medicare, but you must keep your current prescription drug plan Original Medicare or Original Medicare and a prescription drug plan, you cannot make any changes during this time

Although Original Medicare covers most necessary services and is accepted by most doctors and facilities across the country, it does not cover the full cost of care. Many consumers who enroll in Original Medicare choose to purchase supplemental coverage to help pay for out-of-pocket costs such as deductibles and coinsurance.

However, people who disenroll from their Medicare private health plan may have limited ability to buy supplemental coverage. State laws vary on when consumers can purchase Medicare supplemental policies, also known as Medigaps. Call your State Health Insurance Assistance Program (SHIP) to find out if and when you can enroll in a Medigap plan in your state. You can find the number for your local SHIP by visiting www.shiptalk.org or calling 800-MEDICARE.

Consumers who disenroll from their private plan should be aware that they may need to join a stand-alone Medicare prescription drug plan in order to maintain drug coverage. Medicare Rights advises consumers who are choosing a plan to consider not only premium and copayment costs, but also whether the drugs they take are on the plan’s formulary (list of covered drugs). Consumers should also check to see whether the plan places any restrictions on the drugs they take. Restrictions can take the form of quantity limits, prior authorization, and step therapy. To learn more about choosing a Medicare prescription drug plan that best meets your needs, visit Medicare Interactive.

Medicare Rights advises consumers who wish to change their health coverage to do so by calling 800-MEDICARE rather than their plan. If you need to keep or add Medicare prescription drug coverage, it is best to make your coverage change by enrolling in a stand-alone drug plan. When you enroll in a drug plan, you will automatically be enrolled in Original Medicare. Changes made during the MADP are effective the first of the following month.

Learn more about changing your Medicare private health plan on Medicare Interactive.

Resources

• Find the number for your local State Health Insurance Assistance Program (SHIP) at www.shiptalk.org.
• 800-MEDICARE
• Medicare Interactive (www.medicareinteractive.org), the Medicare Rights Center’s free web-based counseling tool, can help you evaluate your coverage options.

Ask Ms. Medicare: How Does Medigap Differ From Medicare Advantage Insurance Plans? - AARP Bulletin

by: Patricia Barry  from: AARP Bulletin

There are very big differences between these two types of insurance, although both are options for people with Medicare. Technically, only medigap counts as "Medicare supplemental insurance"—in fact, that's its formal name—but Medicare Advantage plans may provide some extra benefits that could be considered as supplementing Medicare.

Full Article

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AARP to Insurance Industry: Build on Recent Advances to Help Consumers in Medicare

(AARP Media Relations) As many of the nation’s largest insurers meet today to discuss developments in Medicare, AARP Government Relations Health Director Nora Super called on the private insurance industry to act on key issues that would benefit consumers and would be positive for insurers, as well.

Speaking at the 2010 AHIP Conferences on Medicare and Medicaid, Super urged the insurance industry to join the Association’s efforts to remove barriers to coverage in the Medicare supplemental, or Medigap, insurance market.
 
“One of the clear messages from all Americans over the last year—regardless of which side of the health reform debate they were on—is that nobody should be denied access to quality, affordable health care due to their medical history or a preexisting condition,” said Super. “While the recent health reform law abolished these restrictions in most insurance markets, we urge your help to extend ‘guaranteed issue’ in the Medigap market, which would establish a level playing field for insurers and do the right thing by millions of older Americans.”

Super also encouraged the private insurance plans to take advantage of newly created quality incentives, which will offer bonus payments to Medicare Advantage plans that meet high-quality standards.

“These changes in Medicare Advantage payments offer a win-win opportunity for consumers and insurers alike,” said Super. “Consumers will benefit from better quality and competition among insurance providers, and insurers can earn a direct financial reward for doing so. And everybody wins when better care results in healthier people and lower costs for insurers.”
Read Full Article

The Medicare Counselor

The Medicare Counselor is a free publication of the Medicare Rights Center. Each issue will address timely topics that will help you—social workers, health care providers and other professionals—keep up-to-date on important Medicare issues that affect the well-being of your clients.

In this issue:

Hot Topics from the Hotline. My Medigap (Plan E) will no longer be sold after June 1, 2010. Is my coverage going to change? Read the full article.

Closing the Doughnut Hole: Step 1. The Affordable Care Act passed by Congress and signed by President Obama contains a great deal of information, some of which may seem confusing. Read the full article.

Fast Facts: Baby Boomers. 79 million baby boomers will be aging into Medicare starting in 2011. Here are some facts about the population that is changing the face of retirement. Read the full article.

Dear Hannah. My understanding is that Medicare limits ambulance coverage based on the cost of transporting a patient to the closest facility. Is this correct? Read the full article.

Featured Resources 

The current issue of The Medicare Counselor can always be found online at www.medicarerights.org/thecounselor.pdf.

If you have questions about your Medicare benefits or rights, please call the Medicare Rights Center's national hotline at 800-333-4114. The hotline is open Monday through Friday, 9 a.m. to 5 p.m., Eastern Time.

The Medicare Counselor is in presented to you in PDF format. To view it, you will need Adobe Acrobat Reader or another program that reads PDF files. If you do not already have Adobe Acrobat Reader installed on your computer, you can download it.

Thank you for your continued support.
Sincerely,

The Medicare Counselor

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TIME GOES BY | GRAY MATTERS: Republicans and the Health Care Reform Law

by Saul Friedman

Nobody likes a sore loser. But congressional Republicans, who have not yet come to terms with the election of Barack Obama, cannot get over the passage, with not a single one of their votes, of the health insurance reforms called the Patient Protection and Affordable Care Act.

Thus the Republicans plan to campaign this summer to repeal the law, which they call unpopular. They have not read the latest polls which say otherwise.

The Wall Street Journal poll found that 55 percent want the reforms to have a chance to work. A Vanity Fair poll found that 42 percent would keep all the provisions. That may be why the Republicans won’t say, specifically, which provision should be repealed.

If they did, they would have to support denying insurance coverage to children with pre-existing conditions like asthma or diabetes which is outlawed by the reforms. Or perhaps the Republicans would force middle-class parents to buy separate policies for their adult children; the reforms would cover them until age 26.

How about getting rid of the provisions lowering the Part D cost of drugs, gradually closing the infamous doughnut hole or paying for cancer-preventive screenings?

Or maybe the Republicans simply don’t want coverage that will be available at low cost for the 40 million men, women and children who have no insurance.

More than a dozen state Republican attorneys general have taken a different tack – a fool’s errand, paid for by taxpayers, which pleads that the courts to stop the reforms and declare unconstitutional the provision mandating that all of us purchase insurance (with and without help from the government), the better to create a healthy risk pool.

I don’t have a clue how Republican-dominated courts may rule, but chances are the mandate will stand for each state similarly requires drivers to buy insurance. State laws regulating real estate also require the purchase of homeowners insurance. Becoming eligible for Social Security generally means automatically becoming a beneficiary for Medicare Part A, and Medicare sets a stiff penalty if beneficiaries do not sign up for Part B or Part D when they are first eligible and have no equivalent coverage.

The latest whine of the sore loser is the Republican criticism of the perfectly straight-forward brochure from Health and Human Services (HHS) Secretary Kathleen Sibelius, explaining the admittedly complicated, many-faceted law, which will take years to have full effect. Republicans call it “propaganda” as if their flacks never heard of such a thing.

Her biggest boo-boo, according to the Republicans, was her defense of the law’s reduction of the slush fund for Medicare Advantage plans which George W. Bush gave us as part of the GOP effort to privatize Medicare. Said Sebelius:

“Medicare pays Medicare Advantage insurance companies over $1,000 more per person on average than Original Medicare...The new law levels the plying field by gradually eliminating Medicare overpayments to insurance companies.”

More important, she added, “If you are in a Medicare Advantage plan you will still receive guaranteed Medicare benefits.”

That has not been the case with MA insurers for in April, the Government Accountability Office reported that in 43 percent of MA plans, more than half the beneficiaries were in the “average or poor health group,” meaning they did not receive the best of care.

The reforms will hold all private insurers to a higher stand, mandating that 85 percent of premium income be spent on care. Perhaps the Republicans would repeal that provision.

Here is an example of how ridiculous the sore loser can get. In Britain, the heavy use of alcohol poses a serious health problem for the nation and its National Health Service. As a result, Britain’s National Institute for Health and Clinical Excellence (NICE), which produces guidance on public health, suggested the nation’s doctors question and screen patients on their use of alcohol, the better to understand and treat their health problems and their addiction.

It sounds reasonable. But according to Don McCanne of Physicians for a National Health Plan, America’s Health Insurance Plans (AHIP), a leader in the resistance to the American health reforms, picked on Britain’s socialized health program and blasted NICE for requiring doctors “to invade the privacy of every one of their patients by submitting them to a questionnaire on alcohol use.”

There is no such requirement, but McCanne says AHIP is simply doing its conservative Republican thing, defending the “waste of the superfluous insurance industry” in order to discredit any health reform as “socialist.” I guess we should call this the “booze panel” scare.

Putting aside such silliness, it would be worth understanding how HHS intends to enforce the laws, something advocates have worried about because insurance companies have signaled their intent to poke holes in the reforms. Thus, according to Kaiser Health News, the administration has appointed four watchdogs, with plenty of experience dealing critically with insurance companies.

The new director of the Office of Consumer Information and Insurance Oversight is Jay Angoff, a former Missouri commissioner. They’ll be watching for unseemly premium increases, denials and cancellations of coverage and fraudulent sales pitches.

Finally, there is good news for Medicare Advantage, as well as original Medicare beneficiaries who can get eaten alive by deductibles, co-payments and other out-of-pocket costs. The reforms included changes for the better, including lower costs, in the 10 standard Medigap plans that are now offered in most, but not all states.
The plans with increasing benefits range from A, the most basic; B,C,D, and F, the most popular; G, which is similar to F; and K, L, M and N. You can check them out at the Medicare website.

Depending on the level of coverage one needs and can afford, these plans are designed to fill the gaps in Medicare by paying co-insurance, co-payments, some deductibles and even needed blood transfusions and ambulance service.

Medigap plans cover you throughout the nation and some plans include travel and overseas coverage. With such a policy, many beneficiaries pay virtually nothing towards the cost of their care. And Medicare plus Medigap can end up costing less than Medicare Advantage, which does not have a great record when you’re really sick.

Write to saulfriedman@comcast.net

TIME GOES BY | GRAY MATTERS: Republicans and the Health Care Reform Law

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Updated Chartpack Details Supplemental and Prescription Drug Coverage Among Medicare Beneficiaries

The Kaiser Family Foundation has issued an updated chartpack presenting sources of supplemental and prescription drug coverage among Medicare beneficiaries in 2007, the most recent year for which national data are available. The majority of people on Medicare have some source of supplemental coverage that helps to pay Medicare’s cost-sharing requirements and for some services not covered by the program. Employer plans are the primary source of supplemental coverage; other sources include individually-purchased Medigap policies, Medicaid for those with low incomes, and Medicare Advantage plans. Since 2006, beneficiaries have also had access to a prescription drug benefit offered through Medicare Part D plans. The chartpack looks at variations in supplemental and prescription drug coverage by income, race/ethnicity, age, urban/rural location, and health status. It also examines characteristics of Medicare beneficiaries with low incomes who are not enrolled in a Part D plan or receiving Part D low-income subsidies. Prepared by Kaiser Family Foundation researchers, the chartpack is based on analysis of the 2007 Medicare Current Beneficiary Survey. Link to Chartpack