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Medicare News
CMS Questions Marketing Tactics of Medicare
Advantage Plans
They fail to tell seniors they are not 'traditional'
Medicare
May 8, 2007 - The Wall Street Journal on Tuesday
examined how Medicare Advantage private fee-for-service plans are
"coming under increasing fire" from
CMS
officials "worried about
tactics
used to market them" and from lawmakers who believe the plans receive
"exorbitant government payments."
Abby Block, director of CMS'
Center for
Beneficiary Choices, said the agency is "particularly
concerned" about sales agents who do not adequately inform Medicare
beneficiaries that fee-for-service Medicare Advantage plans differ from
traditional Medicare.
Doctors might decline to treat patients enrolled in
the private plans because they have little experience with the plans,
and in some cases, they might be concerned that reimbursements will be
inadequate or slowly paid, the Journal reports.
To address these issues, CMS officials say they
will require private fee-for-service Medicare Advantage plans next year
to call all new beneficiaries to make sure they understand that the
plans are not traditional Medicare.
CMS also will implement a "secret shopper" program
to police marketing practices and will require insurance companies to
train sales agents on how the plans work.
Meanwhile, House Ways and Means
Health Subcommittee
Chair Pete Stark (D-Calif.) and other Democrats are trying to
reduce payments
to all Medicare Advantage plans -- including managed mare and private
fee-for-service plans -- to the same level as traditional Medicare
reimbursements.
The government spends 19% more on private
fee-for-service Medicare Advantage plans than traditional Medicare and
spends 12% more on all Medicare Advantage plans, according to the
Medicare Payment
Advisory Commission.
MedPAC recommended that the government cut payments
to Medicare Advantage plans to the same level as traditional Medicare.
Stark said that the savings could be used to reduce scheduled payment
cuts to doctors, improve Medicare benefits or provide health coverage to
children. However, insurers say they need higher payments to "cover the
rising costs of providing care in rural areas," and "lawmakers of both
parties ... [are] wary of doing anything that might prompt the plans to
drop out of rural markets," the Journal reports (Zhang, Wall Street
Journal, 5/8).
Editorial
Some Medicare Advantage plans "have been caught
using hard-sell tactics to pressure elderly Americans into signing up
for policies that may leave them worse off than they would be with
traditional Medicare coverage," a
New York Times
editorial states.
"It seems that outrageously high government
subsidies aren't enough to satisfy the private plans that participate in
Medicare," according to the editorial, which adds that the "abusive
sales tactics are particularly egregious among the private
fee-for-service plans" that "receive the highest subsidies and do the
least to earn them among the array of private offerings available for
Medicare recipients."
The editorial concludes, "Congress needs to demand
rigorous policing of the Medicare Advantage program to ensure that such
abuses do not continue. And it should eliminate these lavish subsidies,
which are draining the Medicare trust fund and imposing unfair costs on
beneficiaries in the traditional Medicare program" (New York Times,
5/8).
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