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Senior Citizen Politics
Democrats' Idea to Expand Medicare for Younger
Americans Raises Industry Hackles
Details
fluid but people aged 55 to 64 who were uninsured or could not afford
employer-sponsored health insurance would be allowed to enroll in
Medicare
By
Julie Appleby and
Mary Agnes Carey
KHN Staff Writers
 Dec. 9, 2009 - Hospitals, doctors and insurers are
mounting a full-blown attack on a proposal to allow people under 65 to
join Medicare an idea that's gaining new momentum among Senate
Democrats as they scramble to pick up the 60 votes needed to pass the
sprawling health care legislation.
The Medicare "buy-in" proposal appears to be part
of a tentative package reached late Tuesday between a group of 10
moderate and liberal Democrats who have been working to find consensus
on a variety of issues, including whether to include a government-run
"public option."
Senate Majority Leader Harry Reid, D-Nev., meeting
with reporters Tuesday night, declined to provide details about the
package, which he said had been sent to the Congressional Budget Office
(CBO) for cost estimates.
"It is a consensus that includes a public option
and will help ensure the American people win in two ways: one, insurance
companies will face more competition, and two, the American people will
have more choices," Reid said in a statement.
While details of the package remain fluid, people
aged 55 to 64 who were uninsured or could not afford employer-sponsored
health insurance would be allowed to enroll in Medicare, the federal
program for the elderly and disabled. Currently, there are about four
million people in that age group who are uninsured, according to the
U.S. Census Bureau. They often have a hard time finding or affording
coverage.
Lobbyists for providers and insurers immediately
criticized the buy-in proposal, saying that Medicare already doesn't pay
enough. Adding more people would only compel hospitals, doctors and
others to increase charges to private insurers and employers to make up
the difference, they warned.
The Federation of American Hospitals, in an e-mail
alert to members, said the industry had already agreed to $155
billion in Medicare and Medicaid payment reductions over a decade and
should not be required to make additional financial concessions.
The American Medical Association, whose members
face a 21 percent pay cut next year unless Congress moves to reverse it,
says doctors will oppose any expansion of Medicare until the program's
financial outlook improves.
Insurers are also
opposed. This would add millions of new people to a program
everyone agrees is going broke, says Robert Zirkelbach, a spokesman for
Americas Health Insurance Plans, the industrys lobbying group. He said
the legislation already includes help for people over 55, such as rules
barring insurers from rejecting applicants with health problems.
The House-passed health care legislation doesn't
include a Medicare buy-in provision. In the Senate, meanwhile, major
questions emerged about how such a buy-in would work:
-- Would subsidies be available to people with low
and moderate incomes? Analysts said subsidizing the costs of the
premiums would encourage healthier people to join, which could help
control premium growth over time.
-- How much would people have to pay in premiums?
CBO estimated last year that a slightly different proposal -- to allow
people aged 62 to 64 to buy their way into Medicare would result in
premiums of $7,600 a year. Medicare's expenses would not rise, the CBO
said, but the government would see a $1.6 billion increase in Social
Security payments between 2010 and 2019 as some people retired early.
-- Would the buy-in simply be a temporary measure
until exchanges, the insurance marketplaces that would be created under
the health legislation, are up and running in 2014? Supporters say this
would give immediate relief to those who cant find coverage now.
Opponents worry that Congress wouldn't be able to bring itself to end
the program, even after the exchanges are operating.
The Medicare buy-in proposal is one element of a
multi-pronged strategy a group of 10 moderate and liberal Democrats are
developing in a complicated effort to secure the votes needed to pass
the health legislation. Among other things, the negotiators are trying
to find a middle ground between progressive lawmakers who want the bill
to include a public plan run by the government and more conservative
members who say they wont vote for a measure if it includes such an
option.
In an effort to break the logjam, the lawmakers are
discussing allowing private insurers to offer national policies under
the supervision of the federal Office of Personnel Management, which
currently administers a similar program for federal employees and
Congress.
Opening Medicare to those 55 and over has long been
pushed by Sen. Jay Rockefeller, D-W.Va., who Tuesday said, Im glad to
see (this idea) getting serious consideration.
But Sen. Byron Dorgan, D-N.D. said hes not happy
with the idea. We have the lowest Medicare reimbursement rates in the
country in North Dakota, were at the bottom or second to the bottom.
Wed have to straighten out the reimbursement rates before Id want more
buy-in to Medicare at current rates.
Leslie Norwalk, former acting administrator of the
agency that oversees Medicare, said opponents see the buy-in idea as
another step toward increased government control, and eventually a
single-payer system.
Medicare is the most popular health plan out there
and the idea that it might be expanded is intriguing, said
John Rother, director of legislation and public policy for AARP, the
seniors' lobby. But whether we could support it or not would depend on
all these (as yet not spelled out) details that are quite consequential
for the future of the program.
Joe Baker, president of the
Medicare Rights Center, said hes glad the buy-in idea is being
discussed. But, he said, one of the challenges for lawmakers would be to
ensure that the buy-in population would get the same benefits as people
getting insurance through the new exchanges. If the benefits weren't
similar, he said, Medicare might attract only those who couldn't get a
better deal elsewhere. That, in turn, could mean it would attract a
sicker population, driving up costs.
But under the current versions of the health care
legislation, the insurance on the exchanges would be more generous than
what Medicare provides. The basic plans offered under the House-passed
legislation would limit annual out-of pocket costs to $5,000 for
individuals and $10,000 for families. The Senate limits are a bit
higher. But traditional Medicare doesn't have limits on out-of-pocket
costs.
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This
information was reprinted from
kaiserhealthnews.org with permission from the Henry J.
Kaiser Family Foundation. You can view the entire Kaiser
Daily Health Policy Report, search the archives and sign up
for email delivery. © Henry J. Kaiser Family Foundation. All
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