Sequestration Puts Older Adults at Risk
Sequestration went into effect on March 1, 2013, reducing federal spending for fiscal year 2013 by $85 billion. Congress included sequestration in the Budget Control Act of 2011 as a mechanism to force the U.S. House of Representatives and the Senate to come to an agreement on reducing the long-term federal deficit. Because Congress failed to adopt legislation that would prevent sequestration, several across-the-board spending cuts, many of them harmful to older adults, took effect on March 1st.
Sequestration makes automatic cuts to non-defense discretionary programs. While sequestration does not reduce Medicare, Medicaid or Social Security benefits, it does cut payments to Medicare providers by two percent and cuts many of the vital programs on which people with Medicare rely.
These reductions include:
- A $75 million cut to the Administration for Community Living (ACL), which administers nutrition programs, transportation services, family caregiver services and other programs under the Older Americans Act
- A $23 million cut to the Senior Community Service Employment Program (SCSEP), which enhances employment opportunities for unemployed older Americans
- A $175 million cut to the Low-Income Home Energy Assistance Program (LIHEAP)
- A $19 million cut to funding for Section 202 Housing for the Elderly
These devastating cuts will no doubt have a major impact on the economic security of middle- and low-income Medicare beneficiaries, who will have to spend more out–of-pocket on basic necessities, thus making it more difficult to afford health care. Half of all people with Medicare live on annual incomes of $22,000 or less and spend one-third of their household incomes on health care costs. Due to sequestration, already overburdened seniors will need to make difficult choices, such as whether to pay their heating bills or fill their prescriptions.
Read the National Council on Aging sequestration summary.
Read the Office of Management and Budget’s report to Congress on sequestration.
Report Outlines Hospital Readmissions Rates for People with Medicare
Hospital readmissions for Medicare patients cost the health care system $26 billion a year, according to a new report by the Robert Wood Johnson Foundation (RWJF). More than $17 billion of the total costs for hospital readmissions for Medicare patients are for unnecessary return trips.
According to the report, hospital readmission rates among people with Medicare are closely linked to where the patient lives and the health systems providing their care. Even patients with similar illnesses have varying readmission rates depending on their geographic location. For example, Medicare beneficiaries in Bronx, New York have a 30-day readmission rate of 18.3 percent. In contrast, beneficiaries in Bend, Oregon, admitted for similar reasons, have a readmission rate of 7.6 percent.
The report finds that many beneficiaries were unable to understand their discharge information, including instructions for taking new medications or preventing further complications. Beneficiaries also described feeling rushed through the discharge process and experiencing a lack of follow-up care. Providers reported issues with reimbursement methods that send some patients home before they are ready, thus leading to readmissions.
Under the Affordable Care Act (ACA), the Centers for Medicare & Medicaid Services imposes penalties for hospitals with higher-than-expected readmission rates. As a result, many hospitals are actively engaged in efforts to reduce avoidable readmissions. For example, one hospital featured in the report built a 24-hour pharmacy on-site so patients can fill their prescriptions before they go home, which increases the likelihood that patients can take their prescriptions and prevent readmission. Another hospital created a special clinic for heart failure patients particularly prone to repeated admissions.
Read the RWJF report.
Would you like to learn more about Medicare benefits and coverage? Sign up for Dear Marci.
Dear Marci is a biweekly e-newsletter written by the Medicare Rights Center that helps people with Medicare, their families and caregivers understand their Medicare benefits and options. Each issue features Medicare coverage advice, basic health tips and links to vital health care resources.
Sign up to start receiving Dear Marci.
Read the current issue.
In a letter to Senator Dick Durbin and Representative Jan Schakowsky, the Medicare Right Center expressed its support for the Medicare Prescription Drug Savings and Choice Act of 2013. This legislation works to achieve Medicare savings by securing lower drug prices in the Medicare program, thereby strengthening Medicare’s long-term sustainability.
This important bill creates one or more prescription drug plans administered by Medicare and gives the federal government tools to control the cost of pharmaceutical drugs, including by allowing the U.S. Secretary of Health and Human Services to negotiate prescription drugs prices with drug manufacturers. Together, these policies have the potential to bring down drug prices and enhance the financial security of people with Medicare by reducing premiums and cost-sharing.
Read the letter.