Medicare Watch

GAO Finds Potential Savings in Medicare and Medicaid

Earlier this month, the Government Accountability Office (GAO) released a report detailing recommendations to the Centers for Medicare and Medicaid Services (CMS) that could yield billions of dollars in savings to Original Medicare, the Medicare Advantage program and Medicaid. The GAO submitted the report, “Opportunities for Financial Savings & Program Improvements in Medicare & Medicaid Remain,” as testimony before the Subcommittee on Oversight and Investigations in the House of Representatives. The GAO’s recommendations to CMS include minimizing Medicare fraud, better aligning payments to Medicare private health plans, also known as Medicare Advantage plans, and improving oversight of Medicaid payments.

For example, the GAO recommends that CMS require Medicare contractors to develop automated systems that would proactively identify improper claims. These systems would alert contractors of fraud before the improper claims are paid, thus reducing CMS’ reliance on “pay and chase” strategies. The report also urges CMS to revise Medicare cost-sharing and coverage policies for services, based on clinical recommendations such as those made by the U.S. Preventive Services Task Force. According to the GAO report, this change may improve appropriate use of preventive benefits, ensuring that Medicare beneficiaries for whom a service is recommended can access it at an affordable rate. In addition, the GAO suggests that CMS cancel the Quality Bonus Payment Demonstration for Medicare Advantage plans, and instead implement the quality bonus payments outlined in the Affordable Care Act (ACA). According to the report, the Quality Bonus Payment Demonstration would spend a significant portion of its $8 billion cost rewarding average-performing Medicare Advantage plans, instead of high-performing plans. The GAO also advises CMS to ensure that state Medicaid demonstrations not increase federal costs.

According to the report, previous GAO recommendations to CMS have resulted in savings of $3.4 billion to Medicaid from 2007 through 2012 and $86 million in savings to Medicare from 2006 through 2010.

Read the GAO report, “Opportunities for Financial Savings & Program Improvements in Medicare & Medicaid Remain.”

Medicare Rights Submits Comments on Revised New York State Duals Proposal

Last week, the Medicare Rights Center submitted comments to the New York State Department of Health on its revised demonstration proposal to integrate care for dually eligible individuals—people with both Medicare and Medicaid. As a member of an emerging coalition that represents older adults and people with disabilities, as well as Medicaid beneficiaries, Medicare Rights and other organizations applauded the state for incorporating changes that would improve the health and well-being of dual-eligibles. However, in its comments, we also identified aspects of the proposal that remain unclear and made recommendations on elements that should be added, improved or clarified.

Under this demonstration, beginning in July of this year, New York would passively enroll a population of dual-eligibles statewide into managed fee-for-service health homes. Then, beginning in 2014, the state would passively enroll individuals in eight counties who already receive managed long-term care into Fully-Integrated Dual Advantage (FIDA) plans, which are private managed care plans that administer both Medicare and Medicaid benefits. The affected population would consist of roughly 250,000 dual-eligibles across New York.

Medicare Rights and the coalition supported the proposal’s creation of stakeholder workgroups to address topics such as an integrated appeals and grievances process for Medicare and Medicaid, but also urged New York to ensure that beneficiaries are more engaged in the development and implementation of the demonstration programs. We also raised concerns about how the state will properly notify beneficiaries of their right to opt out of the health home model or disenroll from a FIDA plan into Original Medicare and traditional Medicaid. In addition, our comments addressed the need for an adequate number of providers within each FIDA plan’s network; we suggested that the state determine which services are accessed most by dual-eligibles and establish network requirements correspondingly, including a maximum patient-to-provider ratio.

Stakeholders, including Medicare Rights, will have the opportunity to comment on New York’s revised draft when the Centers for Medicare and Medicaid Services (CMS) publishes the proposal in June.

Read Medicare Rights’ comments.

Medicare Reminder

When you turn 65, whether you should take Part B depends on if you have primary insurance from a current employer or from a spouse’s current employer. You should talk to your employer when you become eligible for Medicare to see how your employer insurance will coordinate with Medicare.

If you or your spouse is still working, and you receive health insurance from that current employer, your employer insurance is primary if there are 20 or more employees at the company where you or your spouse works. If there are fewer than 20 employees, Medicare is your primary coverage, and you should not delay enrollment into Part B.

In either case, if you have insurance from a current employer, you qualify for a Special Enrollment Period that allows you to enroll in Part B at any time while you or your spouse is still working, and for up to eight months after you lose your employer coverage or stop working.

If you are already collecting Social Security, you will automatically be enrolled in both Medicare Part A and Part B when you turn 65. You can turn down Part B, but you should call the Social Security Administration at 800-772-1213, and ask if you can do so without any penalties or gaps in coverage. When you call Social Security, take notes about who you spoke to, when you spoke to them, and what they said.

It is important to remember that COBRA and retiree insurance are not considered current employer insurance. COBRA and retiree insurance are always secondary to Medicare, and you will not have a Special Enrollment Period to enroll in Part B.

Read Medicare Rights’ Part B enrollment toolkit, “How Medicare Works with Employer-Based Health Insurance.”

Learn more about whether you should enroll in Part B if you are still working at www.medicareinteractive.org, or call our helpline at 800-333-4114.

Spotlight

Today, the Centers for Medicare and Medicaid Services (CMS) announced that in the first four months of 2012 alone, more than 416,000 Medicare beneficiaries have received discounts on drugs purchased in the Medicare prescription drug coverage gap, or doughnut hole. Since the passage of the Affordable Care Act in March 2010, people with Medicare have saved $3.5 billion in prescription drug costs as a result of the law’s gradual closure of the coverage gap.

Read CMS’ press release.