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The President's Budget
February 26, 2009 • Volume 9, Issue 8
Private insurance companies will soon be mounting a campaign to stop Congress from approving President Obama’s budget proposal to cut the excessive subsidies they receive for enrolling people in Medicare private health plans.
The companies will talk about how the subsidy cuts will hurt “seniors” enrolled in their Medicare plans, without mentioning that every one of them can still have coverage under Original Medicare. The companies will not talk about how the cuts will hurt profits.
There will be no mention of this important fact:
Insurance companies are paid 14 percent more to provide coverage than taxpayers pay to cover the same person under Original Medicare.
Medicare subsidies are a gravy train for insurance companies, and they want them to go on forever.
This fight is important, and not just for the financial health of Medicare. It is vital for the overall health reform effort, and not just because the savings from reduced subsidies are an important source of money to extend coverage to the uninsured.
The battle to put Medicare payments on par with costs under Original Medicare is the first round in the larger battle to allow a public plan to compete with insurance companies to provide coverage under comprehensive health reform proposals.
A public plan option is projected to have premiums some 20 percent below the rates charged by private companies. That means lower cost coverage for individuals and businesses who choose the public option as well as for those who stick with private plans, which will be forced to be more efficient in order to compete.
Health care is too important, and too expensive, to tolerate wasteful spending. Congress needs to support President Obama’s plan and cut overpayments to Medicare private health plans.
Contact your elected officials and urge them to eliminate the overpayments to Medicare private health plans. Take action now!
“Under current law, Medicare overpays Medicare Advantage plans by 14 percent more on average than what Medicare spends for beneficiaries enrolled in the traditional fee-for-service program. The Administration believes it’s time to stop this waste and will replace the current mechanism to establish payments with a competitive system in which payments would be based on the average of plans’ bids submitted to Medicare. This would allow the market, not Medicare, to set the reimbursement limits, and save taxpayers more than $175 billion over 10 years, as well as reduce Part B premiums.” (Fiscal Year 2010 Budget, Office of Management and Budget, February 2009)
“A cut of this scale would jeopardize the health security of more than ten million seniors enrolled in Medicare Advantage and would turn back the clock on innovative payment incentives to improve the quality of care that patients receive.” (Statement by Karen Ignagni, CEO of America’s Health Insurance Plans, February 2009)
“The new public plan option would provide a less expensive alternative for the uninsured and underinsured than what is currently available in the individual and small business insurance markets. Savings would derive from significantly lower administrative costs and use of Medicare's reformed provider payment rates. Estimates indicate premiums for the public plan would be at least 20 percent below those currently available for a comparable benefit package in the private market.” (A Path to a High Performance Health System: A 2020 Vision and the Policies to Pave the Way, Commonwealth Fund, February 2009)
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Medicare Part D Appeals Help for Advocates Is Here!
Medicare Rights Center’s new Medicare Part D Appeals: An advocate’s manual to navigating the Medicare private drug plan appeals process offers an easy-to-understand, comprehensive overview of the entire appeals process, including real-life case examples, a glossary of important appeals terms, a sample protocol for advocates, and links to important resources.
Register for a FREE copy of this great resource.
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Medicare Part D Monitoring Project
would like to hear about your experience, or that of someone you know, enrolled in a private drug plan. With information about what the issues are with Medicare Part D, we will be able to demand that those problems be fixed. Medicare Rights Center
Submit your story at http://www.medicarerights.org/issues-actions/tell-your-story.php.
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The Louder Our Voice, the Stronger Our Message
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