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Senior Citizen Politics
WSJ Examines Insurance Lobbyists' Fight to Stop
Medicare Advantage Cuts
Budget analysts: Congress could save $54 billion over
5 years if it reduced Medicare Advantage reimbursements
April 30, 2007 - The Wall Street Journal on Monday
examined how insurers are
working
to stop the proposed cuts to Medicare Advantage payments. As part of its
lobbying campaign,
America's Health
Insurance Plans on Monday is scheduled to introduce a
"minority advisory committee" -- made up of more than 30 black, Hispanic
and Asian-American leaders from 16 states, the Journal reports.
Medicare Advantage, which was expanded under the
2003 Medicare law that also created the prescription drug benefit, is a
"prime target" for Democratic lawmakers seeking offsets for their plan
to increase SCHIP funding by $50 billion over five years, the
Journal
reports.
House Ways and Means
Health
Subcommittee Chair Pete Stark (D-Calif.), a leading advocate
for Medicare Advantage cuts, has argued that the government's payments
to private Medicare Advantage providers are excessive compared with what
it would cost for the government to provide direct coverage.
According to budget analysts, Congress could save
$54 billion over five years if it reduced Medicare Advantage
reimbursements to the same level as those for the traditional
fee-for-service program.
The
Journal
reports that private insurers "still think private enterprise will
improve health care -- the idea that attracted [the support of]
President Bush," but their "far more prominent argument this year is
that cutting Medicare Advantage payments would be tantamount to cutting
Medicare itself."
Targeting Minorities
The industry specifically has lobbied minority
lawmakers, contending that Medicare Advantage acts as a safety net for
Medicare beneficiaries with incomes ranging from $10,000 to $20,000 per
year who lack Medicaid or other supplemental coverage to cover
out-of-pocket expenses.
The AHIP minority committee will include
politicians, union officials, pastors and representatives from the
National
Association for the Advancement of Colored People and the
League of United
Latin American Citizens, each of which sent letters to
Congress in March opposing Medicare Advantage cuts.
Meanwhile, Louis Stokes, a former Democratic
representative from Ohio who headed the
Congressional
Black Caucus, has been lobbying on behalf of
UnitedHealth
Group, telling caucus members that Medicare Advantage plans
benefit minority and low-income people by helping them monitor chronic
diseases and reducing their reliance on emergency departments.
Democratic Response
The
Journal
reports that Stark and other Democratic leaders "support helping
lower-income seniors with out-of-pocket costs," but they have argued
that direct government funding would be more efficient. Stark said that
some insurers are trying "to cover up their excessive costs and their
questionable quality." Democratic leaders also argue that Medicare is
designed to provide a uniform benefits package to all beneficiaries,
rather than a variety of benefits that are offered only in certain parts
of the country.
In addition, Democratic members of the
House Ways and
Means Committee in an April 20 e-mail said that private
insurers' lobbying efforts have implied that a disproportionate number
of Medicare Advantage beneficiaries are minorities, although the
proportion of minorities in Medicare Advantage and traditional Medicare
"differs little" (Lueck,
Wall Street Journal,
4/30).
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