Perspective               

Private Health Plans Could Boost Medicare Costs

New data from the Medicare Payment Advisory Committee (MEDPAC), an independent governmental advisory panel, indicate that increasing private health plan participation in the Medicare program will increase Medicare costs rather than lower them, as President Bush and some members of Congress have claimed.

MEDPAC researcher Zachary Dyckman said that private plans, such as HMOs, pay doctors and hospitals approximately 15 percent more than Original Medicare to participate in their networks. Recent research from the Center for Studying Health System Change found that private plan rates run as much as 80 percent higher than Medicare payments to doctors in some areas.

These findings raise new questions about President Bush's plan to push older and disabled individuals into private health plans in order to obtain prescription drug coverage.

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