Medicare Watch: September 5, 2013Mitchell Clark
Your Weekly Medicare Consumer Advocacy Update
Medicare Redesign Proposals Pose Significant Risks to Beneficiaries
|September 5, 2013
||Volume 4, Issue 35
House Committees Return to the Capitol with More of the Same
The House Energy and Commerce Committee and House Committee on Ways and Means recently released the first in a series of discussion papers identifying what they believe to be key flaw in the existing traditional Medicare framework and detailing their own concepts for reforming the Medicare program. The discussion paper reviewed Medicare cost-sharing, the effects of supplemental insurance, or Medigap plans, and ways in which “modernizing” cost sharing in traditional Medicare would reduce overall Medicare costs.
The discussion paper proposes establishing a single combined annual deductible for Medicare Part A and Part B, changing current coinsurance rates and adding an out-of-pocket spending maximum. According to the House Committees, beneficiaries who purchase supplemental insurance plans, or Medigaps, in order to protect themselves against Medicare’s cost sharing requirements have an “incentive” to see the doctor more often because their out-of-pocket costs are covered by the Medigap plan, giving them so-called “first-dollar” health coverage. According to the House Committees, these beneficiaries over-utilize services, thus increasing costs in the Medicare program overall.
However, eliminating first-dollar Medigap coverage shifts costs to Medicare beneficiaries who purchase Medigap insurance as a means of protecting themselves against high out-of-pocket expenses. Further, the other components of the plan that would “simplify” Medicare could also shift costs to people with Medicare as laid out in the discussion paper.
Proposals like those mentioned above, as well as others like raising the eligibility age, increasing premiums for wealthy individuals, and increasing cost sharing on Medicare supplemental plans, save money in Medicare by shifting costs to older adults and people with disabilities. These proposals fail to address the real threat to our nation’s economic health—rising costs throughout the health care system. In contrast, Medicare Rights Center supports solutions that eliminate wasteful spending and promote the delivery of high value care, thus increasing quality while saving money in Medicare.
Read the Committees’ discussion paper.
Read the Medicare Rights fact sheet on Medicare cost savers.
Read the Medicare Rights fact sheet on restructuring Medicare cost sharing.
OIG Takes a Look at Medicare’s Recovery Audit Contractors
Recovery Audit Contractors (RACs) reviewed 2.6 million claims that resulted in improper payments totaling $1.3 billion in 2010 and 2011, according to a recent report by the Department of Health and Human Services Office of the Inspector General (OIG). RACs identified overpayments or underpayments to Medicare providers in half of all the claims RACs reviewed during those two years.
Information about improper payments identified by RACs is stored in the RAC Data Warehouse. OIG collected these files and analyzed improper payments and potential fraud in Fiscal Year (FY) 2010 and FY 2011 in writing its report. The primary responsibility of RACs is to identify improper payments from Medicare Part A and B claims, which may include payments for items or services that do not meet Medicare’s coverage or medical necessity criteria, payments for items that are incorrectly coded during billing, and payments for services where the documentation submitted did not support the service ordered. Once RACs identify an overpayment was made to a provider, providers have to give the overpaid amount back. Conversely, if underpayments are made, providers receive the underpaid amount.
OIG found that over half of all recovered or returned improper payments in FY 2010 and FY 2011 resulted from medical services being delivered in inappropriate facilities, or incorrect billing on the part of providers. Claims from inpatient hospitals accounted for 88 percent of all recovered or returned improper payments. Providers appealed only 6 percent of the overpayments identified by the RACs. OIG also found that while the Centers for Medicare and Medicaid Services (CMS) did take corrective action to address the majority of improper payments larger than $500,000, CMS did not take corrective action on all those large payments, nor did it evaluate the effectives of its corrective actions. In its report, OIG recommended that CMS take corrective action on all improper payments larger than $500,000, evaluate the effectiveness of its corrective actions, and follow-up on RAC referrals of potential fraud.
Read the OIG report.
In most cases, you are only able to change your Medicare private prescription drug plan once a year during Fall Open Enrollment. Fall Open Enrollment occurs between October 15 and December 7 of every year. If you make a change during this time, your new coverage will begin January 1. You can change plans as many times as you need during Fall Open Enrollment, with your last choice taking effect January 1. However, to avoid enrollment problems, it is best to make as few changes as possible.
You may also be able to change your Part D plan during the Medicare Advantage Disenrollment Period (MADP) if you have a Medicare private health plan (also known as a Medicare Advantage plan). The MADP occurs between January 1 and February 14 of every year. If you have a Medicare private health plan, you will be able to switch to Original Medicare with or without a stand-alone prescription drug plan. Changes made during this period will become effective the first of following month. For example, if you switched from a Medicare Advantage plan to Original Medicare and a stand-alone prescription drug plan in February, your new coverage would begin March 1.
Learn more about your options for changing your Medicare prescription drug plan at www.medicareinteractive.org, or call our helpline at 800-333-4114.
Fall Open Enrollment for Medicare takes place between October 15 and December 7 this year. To help media professionals prepare for stories about the enrollment season, Medicare Rights Center has created a Fall Open Enrollment Period resource for journalists. The materials include information on tried-and-true advice for Medicare beneficiaries, moving from the new Health Insurance Marketplace to Medicare, and much more. The resource materials are available here.
Stay up-to-date on Medicare policy and advocacy developments, and learn about changes in Medicare benefits and rules with this weekly newsletter.
* * * *
Health Care Professionals:
Need to stay current on all things Medicare? Try a subscription to Medicare Rights University. This comprehensive training solution features traditional, webinar and video courses to help you train new staff and keep existing staff up to speed on Medicare changes, benefits and options.
Subscribe today at www.medicarerightsuniversity.org/members-page.
* * * *
Get answers to your Medicare questions from Medicare Interactive at www.medicareinteractive.org.
© 2013 by Medicare Rights Center. All rights reserved.
For reprint rights, please contact Mitchell Clark.