Five Myths About Medicare

Robert Laszewski

Posted 2/26/12 on Health Policy and Marketplace Review

I recommend you read John Rother’s recent op-ed in the Washington Post, “Five Myths About Medicare.”

John argues that each of these statements is a myth:

  1. Medicare is inefficient and fails to control costs–the CBO has projected that per capita spending will grow only 1% more than inflation over the next decade.
  2. The well-off don’t pay enough for their Medicare benefits–working age premiums as well as Part B premiums already vary considerably by income.
  3. Medicare benefits are overly generous–in 2007 Medicare paid an average of only half of the $18,000 the average beneficiary spent.
  4. Cutting Medicare is the only way to save it–changing incentives to providers offers more promise.
  5. Medicare needs fundamental restructuring–“Even the most well-run and efficient program cannot nearly double its enrollment without a matching increase in money.”

And this conclusion:

“Containing health-care cost growth is critical for Medicare’s survival, but it’s impossible to do that for Medicare alone. Payment restraints and incentives that improve value must be applied to the entire health-care system to be effective.”

Read “Five Myths About Medicare in the Washington Post.”

ICD-10 To Be Delayed Indefinitely – Never Mind!

Robert Laszewski

Posted 2/14/12 on Health Policy and Marketplace Review

After years of telling us they are serious this time and everyone in the health care system had better be ready on time to implement the new disease coding system, CMS said today the whole project is going to be delayed indefinitely.

The new ICD-10 system requires payers and providers to convert from the old system of 13,000 codes to the new system of 68,000 codes.

Continue reading “ICD-10 To Be Delayed Indefinitely – Never Mind!”

Medicare Advantage Premiums Drop an Average of 7% and Enrollment Is Up 10%—That Must Make Republicans Just Want to Cry

Robert Laszewski

Posted 2/6/12 on Health Policy and Marketplace Review

Medicare Advantage would appear to be a fantastic success—senior premiums are dropping and enrollment is increasing.

Listening to Health and Human Services Secretary Sebelius last week, you would think private Medicare plans were a Democratic idea and this is their success. Many industry observers, including me, have worried that Medicare Advantage benefits would shrink and premiums would rise because the new health care law reduced federal payments to the plans by $136 billion over the next decade.

Continue reading “Medicare Advantage Premiums Drop an Average of 7% and Enrollment Is Up 10%—That Must Make Republicans Just Want to Cry”

The Wyden-Ryan Plan Will Be the Foundation for Serious Medicare Reform—and Maybe More

Robert Laszewski

Posted 2/1/12 on Health Policy and Marketplace Review

In two companion articles in January’s New England Journal of Medicine, Henry Aaron with Austin Frakt, and Joe Antos critique the Wyden-Ryan Medicare reform proposal.

Senator Ron Wyden (D-OR) and Representative Paul Ryan (R-WI) are proposing a hybrid Medicare reform proposal combing both Republican defined contribution free market principles—a premium support scheme—with Democratic defined benefit principles—a baseline guaranteed plan and premium support.

Continue reading “The Wyden-Ryan Plan Will Be the Foundation for Serious Medicare Reform—and Maybe More”

The New Law Needs To Be Repealed, Expanded, and Replaced—So Long As It Doesn’t Have a Mandate

Robert Laszewski

Posted 1/30/12 on Health Policy and Marketplace Review

Last week’s State of the Union speech was notable because the President hardly mentioned the new health care reform law.

Avoiding what is supposed to be the centerpiece domestic accomplishment of President Obama’s first term stuck out like a sore thumb.

He said almost nothing because the Obama team simply doesn’t know what to say.

The fact is the Affordable Care Act (ACA) is generally unpopular, and its best-known provision, the individual mandate, is wildly unpopular.

Continue reading “The New Law Needs To Be Repealed, Expanded, and Replaced—So Long As It Doesn’t Have a Mandate”

Important Research From Medicare Demonstration Projects: Almost Nothing Works

Robert Laszewski

Posted 1/23/12 on Health Policy and Marketplace Review

I will suggest that most of us believe the way to control health care costs, and at the same time maintain or improve quality, is to both use the managed care tools we have developed over the years, and perhaps more importantly, change the payment incentives so that both cost control and quality are upper most in the minds of providers and payers.

The Congressional Budget Office (CBO) has just released an important review of Medicare’s results in testing those ideas. The news is not good.

From the CBO’s blog post:

In the past two decades, Medicare’s administrators have conducted demonstrations to test two broad approaches to enhancing the quality of health care and improving the efficiency of health care delivery in Medicare’s fee-for-service program. Disease management and care coordination demonstrations have sought to improve the quality of care of beneficiaries with chronic illnesses and those whose health care is expected to be particularly costly. Value-based payment demonstrations have given health care providers financial incentives to improve the quality and efficiency of care rather than payments based strictly on the volume and intensity of services delivered.

In an issue brief released today, CBO reviewed the outcomes of 10 major demonstrations—6 in the first category and 4 in the second—that have been evaluated by independent researchers. CBO finds that most programs tested in those demonstrations have not reduced federal spending on Medicare.

Continue reading “Important Research From Medicare Demonstration Projects: Almost Nothing Works”

Will the Feds Be Ready With the Fallback Insurance Exchanges by October 2013?

Robert Laszewski

Posted 1/18/12 on Health Policy and Marketplace Review

Insurance exchanges have to be up and running in all of the states by October 2013 in order to be able to cover people by January 1, 2014.

If the states don’t do it, the feds have to be ready with a fallback exchange. States have to tell HHS if they intend to be ready by January 1, 2013.
Continue reading “Will the Feds Be Ready With the Fallback Insurance Exchanges by October 2013?”