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- Janet on What Sequestration Could Mean to Medicare Advantage Claims Payment
- Kristina on What Sequestration Could Mean to Medicare Advantage Claims Payment
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- Margaret on What Sequestration Could Mean to Medicare Advantage Claims Payment
- Jane Wall Medicare Health Benefits Inc on Strange Bedfellows Come to Medicare Advantage’s Rescue
The Voice of William MacBain
According to The Hill’s Elise Viebeck President Obama is receptive to combining Medicare Part A (in-patient hospital) and Part B (outpatient and doctor) deductibles, into a single deductible just like every other insurance scheme in the US. Predictably those to his left complained, maybe because Virginia’s Eric Cantor also likes the idea. The impact would raise the deductible for people who use only physician services, lower it for anyone who is hospitalized, and, net, save Medicare money by shifting more costs to beneficiaries. However, some of the savings would also be used to add an annual out-of-pocket cap on what beneficiaries would have to spend. This is good insurance logic: don’t cover relatively low cost, predictable expenses. Focus coverage on protecting beneficiaries from catastrophic loss.
Health insurance issuers are generating enough fodder for a good guessing game. Will Obamacare increase rates for individual insurance or not? And if so, will the increase be modest or catastrophic. Writing in the April 25 edition of the Washington Post, Ezra Klein reports that the Blues plan that serves the national capital area is warning of big increases in individual premiums. The cause? More sick people are going to get health insurance, now that the pre-existing condition limitations have been removed by the Affordable Care Act. But is that the whole story? Klein also reports that insurance companies in Vermont and Rhode Island are projecting a more modest impact in announcing their proposed 2014 rates. But in Massachusetts, where “Obamneycare” has been in place since 2006, individual premiums are the highest in the nation.
The March 28 edition of Medicare Advantage News cites a possible trend for provider organizations to sponsor their own Medicare Advantage plans. In the waning days of the old Medicare+Choice program, many provider-sponsored plans came on hard times, so this may seem like an unusual reversal. However, Medicare Advantage lives up to its name, and offers advantages to sponsors as well as members. This includes risk adjusted capitation payments, the option to offer drug coverage that is subsidized by Medicare, and bonus payments for achieving quality targets. Even with the payment reforms imposed by the Affordable Care Act, Gorman Health Group is hearing from a number of provider organizations that the predictable capitation revenue under MA is looking preferable to the fee-for-service treadmill. Medicare fee-for-service reimbursement is becoming increasingly complex, and fee-for-service margins are eroding. The prospect of moving up the food chain is especially appealing to organizations whose costs are largely fixed. MA matches predictable fixed revenue to fixed costs, while FFS requires a constant scramble after variable revenues to achieve necessary margins.
From the Detroit News, 9/12/12:
Gov. Rick Snyder says his plan to reform Blue Cross Blue Shield of Michigan would make health care more affordable and improve health, but it was met Tuesday by resistance from other insurers, the state’s attorney general and a consumer group.
Snyder’s proposal would convert the state’s largest health insurer into a mutual insurance company owned by its members, end its special exemption from state taxes and make it comply with state rules that other insurers must meet.
This reminds me of BCBS of NW Ohio, which became Medical Mutual. They gave up not-for-profit status to go mutual, and, unlike Michigan (at least so far), gave up the Blue Brand. Surprisingly, they have remained a mutual company and not gone the rest of the way to stockholder ownership.
Both the exchanges at the heart of ObamaCare, and the competing plans in the Ryan Medicare reform proposal rely on competition among health insurance plans to reduce the upward trend in the costs of health care. But health insurance isn’t health care.
During an interview with Judy Woodruff on the PBS News Hour, Sen. John Cornyn (R, TX) paused in his criticism of ObamaCare long enough to praise the Medicare drug program: “We have also seen in the Medicare program with the prescription drug program this has really been one of the few successes we have seen in a government program like Medicare, where we actually have competition and transparency, and providers compete based on price and the quality of service.”