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Medicare News
Debate over Reducing Medicare Advantage Plan
Payments Continues
CMS Administrator says they offer better preventive
health benefits than traditional Medicare
May 30, 2007 - Lawmakers continue to debate whether
to reduce federal payments to private insurers that administer the
fastest-growing type of Medicare Advantage plans -- private
fee-for-service plans, the
AP/Atlanta
Journal-Constitution reports (Freking, AP/Atlanta
Journal-Constitution, 5/30).
The House Ways and Means
Health Subcommittee
on May 22 held a hearing on MA private fee-for-service plans, and
subcommittee Chair Pete Stark (D-Calif.) said the plans top his list for
proposed reductions in Medicare reimbursements to fund an expansion of
SCHIP.
Stark said, "Given that half of the projected
Medicare Advantage growth" is in the area of private fee-for-service
plans, "we need to immediately evaluate its value before it gets
unmanageable."
Medicare reimbursements for MA fee-for-service
plans on average are 19% higher than those for traditional Medicare for
equivalent benefits, and critics say that sales agents often
misrepresent the plans to enroll beneficiaries (Kaiser
Daily Health Policy Report, 5/23).
David Certner, legislative policy director for
AARP,
said, "The reason we were moving to managed care was that it could
supposedly deliver health care more cheaply than Medicare. If the plans
can't, the question is why should we give them excess payments?"
However, acting
CMS
Administrator Leslie Norwalk said that private fee-for-service plans
offer better preventive health benefits than traditional Medicare. "It's
clearly better health policy to prevent something and to help someone
lead a better quality of life, without regard to what it cost the
Medicare program," she said.
Former CMS Administrator Tom Scully said it would
be "hard to roll back" enrollment in the plans because "all these
beneficiaries have very plush, wonderful private fee-for-service plans
with zero premiums. They're not going to be very happy when their
congressman tells them it's going away" (AP/Atlanta
Journal-Constitution, 5/30).
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