Medicare Watch

Medicare Rights Submits Testimony to Congress Regarding MedPAC Report

Last week, the Medicare Rights Center submitted testimony to the House of Representatives Committee on Ways and Means, Subcommittee on Health, about the Medicare Payment Advisory Commission’s (MedPAC’s) June report to Congress. Medicare Rights submitted written testimony after the Subcommittee on Health convened a hearing on the subject, during which MedPAC discussed its findings.

In its June report, MedPAC recommended reforming the traditional Medicare benefit design by creating a combined deductible for Part A and Part B services, replacing coinsurances with standard co-payments, instituting a limit on beneficiaries’ out-of-pocket spending, and adding a surcharge to supplemental coverage, including Medigap policies and retiree plans.

In its testimony, Medicare Rights shared MedPAC’s view that Medicare could be improved by a more streamlined design. As stated in the testimony, the current Medicare structure can be difficult for beneficiaries to navigate, as it requires different co-payments and deductibles for Part A and Part B. However, Medicare Rights also cautioned against any redesign of the Medicare benefit that would shift costs onto beneficiaries. For instance, while supportive of a limit on beneficiaries’ out-of-pocket spending, Medicare Rights recognized that even with the institution of a cap, many beneficiaries could still purchase or utilize supplemental coverage to protect themselves against high medical bills. The addition of a supplemental insurance surcharge would thus increase their health care costs. In its June report, MedPAC also argued that supplemental coverage increases utilization of health care services, thus making the program more expensive for all beneficiaries. In response, Medicare Rights testified that increased cost-sharing is a blunt instrument for reducing service utilization; beneficiaries are just as likely to forego necessary care as they are to avoid unnecessary services.

Read Medicare Rights’ testimony.

Read the full MedPAC report.

Kaiser Family Foundation Releases Guide to Supreme Court Decision

On June 28, the Supreme Court of the United States ruled on the constitutionality of the Affordable Care Act (ACA). In a 5-4 vote, the Supreme Court upheld the law, including the individual mandate and the expansion of the Medicaid program, though it also held that states may opt out of the expansion. The Kaiser Family Foundation (KFF) has released a report to help consumers and policymakers understand the Supreme Court’s decision. The report, titled “A Guide to the Supreme Court’s Affordable Care Act Decision,” explores the lawsuit filed by the state of Florida and the ACA provisions that it challenged, explains how the Supreme Court ruled on the constitutionality of these provisions, and looks ahead to how the ACA will be implemented.

As detailed in the Kaiser report, the Supreme Court upheld the constitutionality of the individual mandate on the basis that it is an exercise of Congress’ power to tax. The individual mandate requires most people to have a minimum level of health insurance beginning in 2014. Anyone who does not will be subject to a financial penalty. The Supreme Court ruled that this penalty is essentially a tax, and therefore Congress is within its power to enforce such a tax if people do not carry health insurance.

The Supreme Court also ruled on the constitutionality of the expansion of the Medicaid program to nearly all people under age 65 with household incomes under 133 percent of the federal poverty limit. The expansion was expected to provide health insurance to 17 million uninsured Americans with limited income. The ACA mandated that if a state did not comply with the expansion, the Secretary of Health and Human Services could withhold all federal Medicaid funding from that state. In a ruling that surprised many legal scholars, the Court ruled that states could opt out of the expansion without losing their existing federal Medicaid funds.

Now that the Supreme Court has ruled on the constitutionality of the ACA, implementation of the law will continue. Many states have already received federal planning grants to help them build health insurance marketplaces, or exchanges, which will provide affordable coverage options to residents beginning in 2014. Certain Americans will also receive federal subsidies to help them pay for health insurance.

Read the KFF report, “A Guide to the Supreme Court’s Affordable Care Act Decision.”

Read Medicare Rights Center President Joe Baker’s statement on the Supreme Court’s decision.

Medicare Reminder

Equitable relief is an administrative process created under federal law that allows people with Medicare to request relief from the Social Security Administration (SSA) in the form of immediate or retroactive enrollment into Medicare Part B, and/or the elimination of a Part B premium penalty. You may be paying a penalty for Part B if you did not enroll when you first became eligible.

For SSA to grant equitable relief, it must determine that the reason you did not enroll in Part B when you should have was “unintentional, inadvertent, or erroneous” and was the result of “error, misrepresentation or inaction of a federal employee or any person authorized by the federal government to act in its behalf.” For example, if you did not enroll in Part B because an SSA or Medicare representative told you that you did not need to enroll, you may have grounds for equitable relief.

Learn more about how to request equitable relief at www.medicareinteractive.org, or call our helpline at 800-333-4114.

Spotlight

This week, the Department of Health and Human Services announced that 89 new Accountable Care Organizations (ACOs) began serving 1.2 million people with Medicare earlier this month. These organizations are groups of providers that work together to coordinate care for patients. The newly named ACOs will participate in a model that will allow them to share in savings they make for the Medicare program, through their efforts to provide high-quality health care at a lower cost.

Read the Centers for Medicare & Medicaid Services’ press release.