Medicare Watch

Kaiser Family Foundation Releases Policy Ideas to Strengthen Medicare

Yesterday, the Kaiser Family Foundation (KFF) released its compendium of policy ideas, which have the potential to produce savings in the Medicare program. According to KFF, the report, “Policy Options to Sustain Medicare for the Future,” is not a set of endorsements or recommendations of any specific policies. Instead, the report gives a wide range of policy options with potential savings estimates. The report includes options in the following areas:

• Medicare eligibility, beneficiary costs, and program financing;
• Medicare payments to providers and plans;
• Delivery system reform and care for high-need beneficiaries;
• Medicare program structure; and
• Medicare program administration, including program integrity.

As policymakers continue to negotiate various methods of reducing federal spending, Medicare sits squarely in the midst of the debate. Medicare spending is projected to continue to increase more slowly than the GDP over the next ten years. The Affordable Care Act (ACA) controls the growth rate of Medicare Advantage (MA) plan and hospital payments, promotes high value health care (i.e. better quality care at a lower price), and reduces waste, fraud and abuse in the Medicare program. However, the retirement of the Baby Boom generation and rising health care costs pose fiscal challenges for the nation. According to the KFF report, the number of people eligible for Medicare is projected to rise from 50 million today to nearly 90 million by 2040.

As more people become eligible for the program, it is imperative that policymakers concentrate on responsible ways to lower rising health care costs, while maintaining Medicare’s integrity and protecting beneficiaries who are unable to pay more for their health care.

Read the KFF report.

New Commonwealth Report Recommends Ways to Control Health Care Costs and Achieve Higher Quality of Care

The Commonwealth Fund recently released a new report, “Confronting Costs: Stabilizing U.S. Health Spending While Moving Toward a High Performance Health Care System,” which summarizes causes of rising health care costs and proposes methods to control those costs while maintaining (and achieving) higher quality of care. According to the Commonwealth Fund, the methods described in the report could slow spending by $2 trillion over the next ten years by reforming provider payment delivery, incentivizing and educating consumers to consider higher-value choices, and reducing administrative costs, while targeting spending growth.

In the report, the Commonwealth Fund also proposes establishing a new “Medicare Essential” plan that provides more comprehensive benefits and better protection against catastrophic costs. This new plan would encourage Medicare beneficiaries to obtain care from high-performing care systems by including provider and enrollee incentives to improve care, achieve better health and lower costs. According to the report, beneficiaries would enroll in a modernized “Medicare Essential” benefit option with deductibles or copayments lowered or eliminated for those who register with a medical home or receive care from a care team. The premium for a “Medicare Essential” plan would gen­erally be lower than the amount beneficiaries typically pay for current Medicare supplement (Medigap) insurance, in part, because of lower administrative costs.

Read the Commonwealth report.

Medicare Reminder

Medicare helps pay for inpatient mental health services in psychiatric hospitals (hospitals that only treat mental health patients) or general hospitals. Your doctor will determine which hospital setting you need.

If you receive care in a psychiatric hospital, Medicare helps pay for up to 190 days of inpatient care in your lifetime. After you have reached that limit, Medicare may help pay for mental health care at a general hospital.

Your out-of-pocket costs are the same in a psychiatric hospital as they are in any hospital.

If you enter a psychiatric hospital within 60 days of being an inpatient at a different hospital, you are in the same benefit period and do not have to pay the deductible again. A benefit period begins the day you start getting inpatient care and ends when you’ve been out of the hospital or skilled nursing facility for 60 days in a row.

Learn more about Medicare coverage of mental health services at www.medicareinteractive.org.

Spotlight

This week, Medicare Rights Center President Joe Baker expressed strong support for the Medicare Prescription Drug Price Negotiation Act (S. 117), legislation re-introduced by U.S. Senator Amy Klobuchar to help lower prescription drug prices for older adults and people with disabilities.

In his letter to Senator Klobuchar, Mr. Baker praises the bill as “important legislation that adds to the tools available to the federal government to control the cost of pharmaceutical drugs under Medicare Part D.” A key part of the bill leverages the federal government’s buying power by allowing the U.S. Secretary of Health and Human Services to negotiate Medicare drug prices with pharmaceutical manufacturers, which has the potential to contain drug prices in Medicare Part D.

Read Mr. Baker’s letter.

Read Senator Klobuchar’s press release.