By MONA MANGAT, MD
As we move thru 2011, many states are eagerly progressing with implementation of the Affordable Care Act (ACA). We have many Early Innovators that are leaders in setting up the state based exchanges. These states are Kansas, Maryland, New York, Oklahoma, Oregon, Wisconsin and a multi-state entity led by the University of Massachusetts Medical School that consists of Connecticut, Maine, Massachusetts, Rhode Island, and Vermont. Furthermore, Vermont is poised to pass the country’s first state-wide single payer system.
You can imagine when I look in my own back yard I get a bit depressed. Despite our 80 degree sunny weather, our state is leading the charge to overturn the ACA. Our newly elected governor, Rick Scott (the past CEO of Columbia/HCA when the company pleaded guilty to MCR fraud and paid $1.7 bil fine) is singularly focused on not implementing the ACA in Florida. As the months go by and other states move forward, we continue to move backwards.
As expected, it is the poor and sick that continue to suffer the most. The current assault occurring in Florida is on Medicaid. Medicaid currently covers close to 3 million Floridians (nearly 15% of the population) at a cost of nearly $19 billion dollars. The cost of each state Medicaid program is a burden shared jointly by the states and the federal government.
For every $1 spent by the state, the federal government matches $1.84. Florida Medicaid already has some of the most restrictive eligibility criteria in the country, such that the only people who can qualify for Florida Medicaid are: 1) low-income infants, toddlers, preschool-age children, and pregnant women; 2) extremely low-income school-age children, seniors, people with disabilities; and 3) parents of children in deep poverty. 60% of FL Medicaid recipients are children.
So this so called ‘safety-net’ has some gaping holes in it. It leaves the working poor with no insurance options. The ACA calls for an expansion of Medicaid eligibility so that poor who make less than 133 percent of the federal poverty level would become eligible. Currently, that means a single person who makes $14,404 or less, and a family of four that has income of less than $29,327 could be on Medicaid. Instead of trying to strengthen this safety net and help insure more Floridians, the governor and legislature has stated that the cost of expanding Medicaid is a burden our state cannot handle. They may not be aware that during this expansion, the federal government would match the spending initially at 100% and then drop to 90% by 2019. This would offer coverage to 1.5 million previously uninsured Floridians by 2019 at a cost of between $149 million in 2014 and $1.1 billion in 2019
The state of Florida has instead chosen to press forward with a plan to privatize Medicaid. In 2005, then Gov. Jeb Bush began a pilot program to privatize Medicaid plans in 5 counties. This plan has been met with much criticism both from providers and beneficiaries. Concerns were raised back in 2007 by AHCA Inspector General Linda Keen regarding the plan’s success. Georgetown University researchers raised issued and noted that some doctors couldn’t afford to provide care to Medicaid patients under these plans. The University of Florida released an analysis of the pilots in 2009 that revealed some modest cost savings but made no analysis of quality or accessibility of care.
These plans reimburse physicians at 58% of Medicaid reimbursement rates. Some of my colleagues find that seeing these patients actually costs them money. This has obviously led to low acceptance and participation by providers.
I currently participate in 5 private Medicaid plans. Four of them require paper claims for reimbursement as well as onerous authorization procedures. I currently care for a 4 year old child with recurrent seasonal wheezing that has concomitant growth delays. I have attempted to treat her with a leukotriene modifier drug. Her private Medicaid provider denied my request, insisting that I use a generic nebulized steroid preparation. I engaged in a peer-to-peer review to try and get approval (that lasted 15 minutes over the phone), after exhausting 3 levels of paper prior authorizations. The friendly doctor I spoke with apologized that the drug could not be approved and when pressed for a reason, his answer was clear- COST. My patient will have to be placed on a medication that could further stunt her growth when a safer option is available, because her privately administered Medicaid insurance plan needs to make more profit.
I am amazed at how history repeats itself. Did we learn nothing from the failed experiment of privatizing Medicare? As a reminder, Medicare Advantage programs cost taxpayers 14 percent more than traditional, fee-for-service Medicare. This additional cost did not contribute to better care for seniors. It surely lined the pockets of the insurers with big profits. The same thing will happen in Florida if we agree to let Medicaid become a private endeavor. And millions of Floridians will again be left poor, sick and uninsured.
We will fight to implement the ACA because it will benefit Floridians. Amazingly, doctors are united in their push back against the plan to privatize Medicaid. I take some solace in that, and will continue to vicariously enjoy the improvements being made in other states across the country.
Mona Mangat, MD, is an Allergy & Immunology specialist in St. Petersburg, FL. She blogs at Doctors for America, where this post first appeared.
Categories: Uncategorized
Great study Mona.
In Australia we have great health care. The public sector could be better, but it’s certainly better than relying on private institutions.
AZ providers were never nearly as integrated as UT and N CA. Some pockets but it would be much harder to pull off an IMHC in a big metro area then rural UT or ID.
I actually had the UHC coverage in Arizona. Thanks for explaining the exemption, that makes sense and sounds important. I suppose it was wishful thinking that the for-profit health insurer problem would magically go away itself. When say it that way, it does sound really stupid.
Your comparing an Insurance company to an integrated care provider that also sells insurance. When measuring UHC EMRs, cordination, and such shouldn’t even be discussed. That was the doctors you chose to see not UHC.
In Ohio Kaiser uses Cleveland Clinic facilities for example. You can find integrated doctors just as fancy and up to date in UHCs network you just need to pick them from the much broader choice of providers, and thus one of the reasons other insureres exist.
“Since I heard that healthcare companies are exempted from antitrust law,”
If you believe 10% of what you hear about healthcare your going to have some terribly misinfomed ideas. Their limited exemption allows them to share claims data and some other trivial data which allows them to more accurtly price premiums. It would be very hard for an insurance company to enter a new market if all the data on that market was kept secert.
Instead of inhibiting comptetion like you were told, the LIMITED exemption actually fosters competrition, why would we want to do away with that?
Having worked in UT and rented IMHs provider network I am surprised you couldn’t see those same doctors with your UHC coverage.
I’ll have to do that, Nate. My libertarian leanings makes me uneasy to outright ban profit in healthcare insurance markets, but if absolutely necessary I suppose there’d be no other choice. I mean, I can’t argue for the virtues of social service markets without real social service markets.
I’ve been on Kaiser, Intermountain Healthcare’s Select Med, and United Healthcare. Of the three, only United Healthcare is for-profit. Kaiser and Select Med are both HMOs, and the quality of care is astounding. United Healthcare, on the other hand, tried to reject most claims, the doctors didn’t coordinate with each other at all, had no electronic medical records to speak off, and in general sucked.
The difference between the non-profits and UHC is so large that I honestly cannot understand why UHC is still in business. Since I heard that healthcare companies are exempted from antitrust law, and since UHC has a low market share in Utah, which has it’s own law, I started wondering if market forces might weed out for-profit firms in healthcare markets.
joeedh,
Do you even know what the exemption is? From your comment you obviously don’t, you might want to read up on it if you care about having an informed opinion.
A few points.
First, any state that uses for-profit insurers for privatizing Medicaid is insane. Social service markets don’t need profit motives the way other markets do, and I honestly believe that for-profit insurers wouldn’t even exist if not for government protection (i.e. the exemption from federal antitrust law).
Second, if existing Medicaid structures are working well (which I completely disagree with, but if they were) than ideally the state would simply duplicate its existing system into three or four non-profit companies that compete with each other, and monitor them to catch market failures.
Obviously privatizing social insurance programs into profit-driven markets can be dangerous, but health care is a special case; it doesn’t *need* a profit motive, and at least in my own personal experience at least, nonprofits seem way more competitive than for-profits.
I don’t think privatizing Medicaid is the answer. I worked for one of those Medicaid mills that assault patients who don’t have insurance in the ER to try to get them signed up for Medicaid and the abuses against patients were untold. I finally quit out of sheer disgust. The woman running it was an absolute heartless pig. One patient complained to me that one of these cheeky, idiot reps told her she would not be able to take her newborn home from the ICU if she did not consent to signing Medicaid forms. What kind of abuse/crap is that?? It was inconceivable to me how badly patients were treated by these ignorant people. Let me not even get into their careless handling of patient information. I complained to HIPAA who told me this Medicaid mill was not a covered entity and not really accountable for the innumerable abuses I counted off to them. If I should ever be in a position where I need Medicaid, I will go through a legitimate Medicaid/government office and not one of these clown agencies; otherwise, I will go without as will many other patients. Definitely privatization is just asking for trouble.
thanks for the constructive comment. Any contribution to the actual subject of the post?
Mr. Ogden,
1. Learn to spell. Or, are you “to lasy”?
2. Don’t be an asshole.
Cheers
If there is selection bias generated by the HMOs how come not a single person can even describe how it might work let alone show it exist? Its pretty clear why these plans are not sold in rural areas and it has nothing to do with the HMOs. Rural areas have poor PPO participation and discounting for private insurance to start with, if you are the only hospital or provider for 200 miles why would you work with an HMO? That is one reason the FFS MA plans where pushed they wanted broader access across the country.
I beleive it is Maraglit or Maggie, one of the resident flaming liberals, that can refer you to numerous hospitals that are profitable on Medicare business.
Mr. Carol–find me a hospital that generates a 5% margin on its Medicare business. Most would show a negative margin of 10-15% or more. So while 5% may not sound like much, it represents a margin swing of 15-20% over what a hospital can make on Medicare. Also, given where these policies are, and are not sold, it is difficult to believe that there is not a very sophisticated selection bias. These policies are not sold in rural areas where so many could benefit from the extra goodies. And don’t forget, the program is paying 12-15% more per subscriber.
“How sad, Barry. If you tried to approach a private capital firm with a business plan based on so many “maybe” and “perhaps”, you wouldn’t be able to raise one red cent,”
Margalit you must really be sheltered. just when I think you hit rock bottom of commenting you come out with something like this.
.com boom, and crash, ever hear of it? Have you never read some ideas that got millions in funding.
I beleive the number is 50%+ of restraunts and 80% of bars fail, where did all that money come from?
Investment firms through money at plenty of dumb BS, offer a high enough return or have a good background and they would fund flipping a coin. In fact their are funded corporations out there right now with no business plan, people created and other people funded corporations with hundreds of millions of dollars to do something later to be determined.
Is this snake oil enterprize any worse then some of the art we “invested in” Was just in downtown cleveland and passed the giant red Free stamp, guess who paid for that. What about the failing schools we invest in? Cold Fusion. North Korea.
“It’s hard to find data on the acuity of the two populations because insurance companies won’t publish enough data to help us know that.”
Then you link to articles that discuss 4-5 studies of MA data. what data would you like to see that is not available?
How does diluting the DSH ratio prove FFS is sicker then MA? It just proves the government doesn’t want to pay as much and ratching down everyone’s, well the 69% in MA service areas, payment is a quick way to do it.
” this blog post has three published articles which show there is risk selection at work to ensure a healthier population among the Advantage population as compared to the traditional population. ”
I think you read different articles. The first one for example suggest their might be, it doesn’t present any solid evidence at all. Every other word is maybe, could, possibly.
Your second part of that sentance is flat out wrong. While there are studies to suggest the results and outcomes might be favorable none claimed the HMOs controlled selection of risk to make more money. If you knew how MA plans where sold you would know that is not possible.
It is a far different claim to argue healthier people elect to join MA then it is to claim MA markets to healthier people, they are vastly different claims and there is NO evidence to support the second one.
” There’s tons of evidence that show’s there’s selection bias.”
But none of it good and almost all of it by people advocating a political position. I have tons of evidence that democrats destroyed healthcare does that mean Democrats should not be allowed to pass healthcare legislation any more? Most people on this blog would argue my evidence isn’t as important as their evidence they fixed it. No one has proven a selection bias. And further no one has shown even any evidence its MA driven bias versus market preference.
“Our basic knowledge of how insurance companies make money indicate that there’s selection bias. ”
90% of THCB readers have no clue how insurance companies work. How does their operation indicate selection bias?
Leave it to Maggie Maher to bring a subjective opinion pool to a factual argument. Odd Maggie any idea why they didn’t ask how much they would pay for Basic Medicare benefits? Lets see how many seniors would pay $7000 a year for basic Medicare. Or lets ask 20 somethings how much they would pay for a non existant social security benefit 47 years later.
Go peddle your junk science on your blog where you edit all disenting views.
“A 2009 study published in the International Journal of Health Care Finance and Economics reveals that when Advantage beneficiaries were asked how much they would pay, out of their own pocket, for the benefits provided by their insurer, they estimated the value of those benefits at 14 cents for every extra dollar that Medicare was ponying up. As economist Austin Frakt, a co-author of the report, explains: This relatively poor return of value on taxpayer dollars is why I support reductions in Advantage payments. The administration and congressional Democrats have chosen the right path for Advantage payment policy.”
Maggie – I have a different take on this. I wonder how participants in standard Medicare would answer the following question: If you needed comprehensive health insurance and were 55-64 years old, how much would you be willing to pay in premiums for an insurance policy with benefits equivalent to standard Medicare assuming you have an upper middle class income and could afford the coverage? The actuarial value of the complete Medicare benefit package is roundly $1,100 per month per person. For the under 65 population with comprehensive employer provided coverage for which they pay between zero and 30% toward the cost of their premium, how much would they be willing to pay out of pocket for equivalent coverage if the employer didn’t provide it and they could afford it? I suspect that neither group has an accurate perception of how much it costs to provide comprehensive health insurance. Presumably, they value it and think they need it but they expect to be able to buy it for less than it costs to provide. The same is true of government services generally. Most people simply want and expect more from government than they are willing to pay for in taxes or user fees.
Nate writes:
“Are they to lasy or to stupid to look up how these plans run and where the 14% went. FYI Dr. federal law required a set amount of that premium be spent on additional benefits so it was impossible for it to increase their profits. If you can’t get simple facts like that strait the rest of your post can’t be any better. . . . Simple basic facts.”
Here are the facts abourt the extra payments to Medicare Advantage plans: “. even Advantage customers acknowledge that the “extras” that Advantage plans offer just aren’t worth that much to them. A 2009 study published in the International Journal of Health Care Finance and Economics reveals that when Advantage beneficiaries were asked how much they would pay, out of their own pocket, for the benefits provided by their insurer, they estimated the value of those benefits at 14 cents for every extra dollar that Medicare was ponying up. As economist Austin Frakt, a co-author of the report, explains: This relatively poor return of value on taxpayer dollars is why I support reductions in Advantage payments. The administration and congressional Democrats have chosen the right path for Advantage payment policy.”
How sad, Barry. If you tried to approach a private capital firm with a business plan based on so many “maybe” and “perhaps”, you wouldn’t be able to raise one red cent, but tax payers are somehow expected to invest many billions in this snake oil enterprise…. I, for one, am fed up.
“What exactly is the thinking behind the assumption that this time around the same actions will have different results?”
Margalit – I have no idea. Perhaps patient expectations have gotten more realistic now that health insurance is unaffordable for so many, including smaller and mid-size employers. Maybe electronic records are more robust than they were in the 1990’s allowing for better care coordination and less duplicate testing. Or, maybe the referring doctors within the ACO will be better able to identify the most cost-effective providers for needed care outside of the ACO, especially for hospital based care. At the same time, I don’t know whether they will be any more able or willing to take on the financial risk associated with fixed or global payments.
In practice, risk selection is a much cheaper and easier way to maximize profits than is case management.
I’d be curious to look at ASO populations vs. similar managed populations. There could be declines in readmission due to other factors unrelated to attempts at case management. My hunch would be that insurance companies add almost no actual value over what other actors in the industry are already doing.
“Isn’t better care management and coordination the key reason behind all the interest in ACO’s?”
Perhaps it is, but wasn’t this the same reason for the previous attempts to encourage creation of HMOs? What exactly is the thinking behind the assumption that this time around the same actions will have different results?
Margalit and Spike –
I know that the risk adjustment state of the art still is not where it ultimately needs to be. While people in the industry tell me it’s “not bad,” it still tends to overpay for the healthy and underpay for the sick. While that creates an incentive to avoid the sickest patients, if MA membership continues to grow over time, any population health differences between the two groups should narrow.
At the same time, on a separate track, insurers are making progress in care management. For example, inpatient bed days per thousand members are declining, in part, because of better discharge planning and care coordination using case managers. That helps to reduce readmission rates. Within the MA population, due to recent changes in the law, more members are now in HMO’s and PPO’s while fewer are in PFFS plans. The HMO’s in particular should be better able to manage and coordinate care than unmanaged standard Medicare. Isn’t better care management and coordination the key reason behind all the interest in ACO’s?
“Payments to insurers are risk adjusted. If both populations have roughly the same percentage of low income beneficiaries, they are probably comparable in health status as well.”
I am not sure this is a valid assumption, Barry. Risk is calculated based on recorded diagnoses, and there is an entire industry around “optimization” of recorded diagnoses for the purpose of risk calculation in subsequent years. So perhaps on paper the populations are comparable, but I am not sure about actuals.
Very few docs it my area take MA plans at all. They combine the worst of traditional Medicare (low pay) and private insurance (byzantine rules than can change over night).
Sorry, I didn’t respond to your post adequately. There are studies that show there’s selection bias in the Medicare Advantage plan, there’s anecdotal evidence like the DSH calculation that show there’s selection bias. There’s tons of evidence that show’s there’s selection bias.
Our basic knowledge of how insurance companies make money indicate that there’s selection bias. My understanding as a data analyst shows that Medicare Advantage plans are going to cook the stats to make it look like it’s their interventions that improve outcomes when we all know that the insurance company business model since HMOs imploded was to lobby the government for more funding (i.e. Medicare Advantage overpayments) and initiate selection bias in any population where they can.
To me, it’s extremely naive to think that I’m wrong about this selection bias.
The payments being risk adjusted doesn’t mean the utilization stats are risk adjusted. The utilization stats are basically worthless, that’s my point.
As a pro-government liberal, I’m all for enacting steps to reduce fraud to bolster people’s confidence in government programs. I’m also cynical enough at this point to smell a Tea Party feeding frenzy when I see one, and requiring fingerprinting to be a Medicare provider is Exhibit A.
Don’t blame me for my opinion, blame “Death Panels”.
Spike –
It was the doctors’ lobby that ultimately won the 1979 court decision that prohibits Medicare from disclosing aggregate claims payments to individual providers. While Dr. Mangat, of course, can’t change this single handedly, her profession could do a lot more to support transparency in healthcare.
Over 12 million people now have Medicare Advantage plans or about 25% of the total eligible population. Payments to insurers are risk adjusted. If both populations have roughly the same percentage of low income beneficiaries, they are probably comparable in health status as well.
As for treating doctors like criminals so they can get paid, when I served in the army, I was fingerprinted. When I worked for a large bank, I was fingerprinted as a condition of employment. When I later worked for a money management firm, I was fingerprinted as a condition of employment. It was standard procedure and nobody felt like they were being treated as criminals. Moreover, as I’ve said several times before, I support national ID cards with a name, address, picture, and a fingerprint or other biometric identifier as the 9/11 Commission recommended. I’m not singling out doctors here.
Finally, South Florida in particular is the most notorious location for healthcare fraud in the country. Perhaps Governor Scott is uniquely qualified to go after it.
It’s hard to find data on the acuity of the two populations because insurance companies won’t publish enough data to help us know that.
However, this blog post has three published articles which show there is risk selection at work to ensure a healthier population among the Advantage population as compared to the traditional population.
http://theincidentaleconomist.com/100-percent-enough/
2003: [“We find that favorable selection persists in the cohort over time on some, but not all, measures…Most, but not all, studies of Medicare HMOs have found evidence of favorable HMO selection.” See Table 1 for a list of studies from for years no later than 1996.]
2007: [“Medicare plans experience favorable selection bias partly because sicker members are likelier to disenroll.”]
2009: [“…numerous studies have shown that Medicare managed care plans still attract healthier Medicare beneficiaries….Our findings extend prior research showing that [MA] plans experience favorable selection.”]
Nate, Let’s have Medicare fingerprint all doctors. Democrats couldn’t propose end-of-life planning (a longtime Republican hobby horse) without it being turned into death panels. Biometric scanning of all doctors to bill Medicare will be turned into the next “Final Solution”.
I’ll look for evidence regarding risk assessment of Medicare vs. Medicare Advantage. One thing I hear a lot is that the Medicare SSI population is much more concentrated in the Medicare population rather than Medicare Advantage. CMS wants hospitals to shadow-bill Advantage bills to Traditional Medicare to dilute their SSI % for the DSH calculation. If the Advantage population weren’t disproportionately healthy compared to the traditional Medicare population, the Advantage patients wouldn’t dilute the hospital’s SSI percentage. I don’t expect you to have a clue what I’m talking about, but to me that’s pretty good evidence that the Medicare population is sicker than Medicare Advantage.
” treating doctors like criminals just to get paid for providing services sounds like a reform specifically enacted to get people to have the government even more. How about Humana or United Health tries that one out first before Medicare tries it?”
Sorry Spike, your ignornace is showing again. Anyone licensed that works for Humana or United Health or sells their product is already required to be licensed and fingerprinted. Has been that way for all of the almost 20 years I have been licensed. If I need to get fingerprinted to sell the policy why shouldn’t the doctor also be fingerprinted to charge services?
” you know that Medicare Advantage plans market to a healthier population than the general Medicare population as a whole.”
Steve can you please provide an example of how this is done or anything to substantiate this claim? MA is marketed to brokers who make a flat one time annual commission in most cases. These brokers have no stake in the health of the people they sign up so they sign up regardless of health.
Your dogma is further disproved by the enrollment based on poverty
” Beneficiaries with incomes less than $10,000 per year make up 17 percent of Medicare enrollees and 16 percent of Medicare Advantage enrollees.”
And beyond that, do you really think Dr. Mangat has the power to enact the reforms you describe? Also, treating doctors like criminals just to get paid for providing services sounds like a reform specifically enacted to get people to have the government even more. How about Humana or United Health tries that one out first before Medicare tries it?
I guess Rick Scott could take a Joseph Kennedy approach and reform the system he himself exploited, but when you google “Rick Scott Medicaid Fraud” all that comes up are the fraud he perpetrated, not his efforts to combat it now that he’s Governor.
Barry, come on, you know that Medicare Advantage plans market to a healthier population than the general Medicare population as a whole. You’re passing along home-cooked utilization stats from an insurance company executive as if they’re gospel. Just a hunch those stats didn’t take into account the health of the Medicare Advantage vs. Traditional Medicare populations to get an apples to apples comparison.
And you have the nerve to write this naive garbage in a post that’s exceedingly condescending to the original poster.
pcp,
what about vision exams in the eldery to diagnosis and manage diabetes?
dental exams to catch and prevent something from turning into a medical problem?
When you say many can afford these does that mean your open to a tiered system where wealthier people get different benefits then aged-poor? Personally I think we should allow people to opt out of Medicare without taking away their SS, if they want to buy better coverage on their own why force them to stay?
“Lets apply this logic to everything.”
No problem with that. I think that you will find that dental and vision care in the Medicaid population pays off long term.
Dental care for the over 65 crowd, many of whom can already afford it, probably not.
High risk pools benefit definitely outweighs cost.
Brand name Rxs: off with their heads.
I suspect what really bothers Dr. Mangat and those like here is managed care cutting off their gravey train. Its well documented how providers abuse the 2 public health systems, treating it like an ATM or daddy’s credit card. The private payors don’t have near the tolerance for this abuse, if more people were to enroll in MA or privatized Medicaid providers might have to actually start acting honestly and stop ripping off the tax payors.
MA profit pales in comparison to the tens of billions lost to fraud and abuse, you won’t hear a word out of them about that money but they are all over any private business that tries to make a penny.
“increased benefits at tax payer expense (with no documented improvement in health) = more enrollees = increased profit”
Lets apply this logic to everything. Has dental and vision improved health in the Medicaid population? Lets do away with that.
Have high risk pools increased health? They are far more expensive then regular insurance lets get rid of them.
Does Brand name Rx coverage increase health? Lets get rid of that in Medicaid, Part D, and VA.
Dr. Mangat –
While 60% of FL’s Medicaid population may be children, over 70% of Medicaid SPENDING (nationwide) is on the ABD population – Aged, Blind and Disabled. If the medical community got its act together and did a better job of helping patients to plan for the end of life and curtail the waste spent on futile care that patients often don’t even want, there might be more money to take care of kids who are, for the most part, cheap to insure.
It’s also amusing that you mentioned Governor Scott and his past history at Columbia-HCA. Everyone knows that FL is the medical fraud capital of the world. If you and your colleagues had any interest in curtailing that, you would agree to allow the federal government to make its extensive claims database, including payments to individual doctors and other providers, available to outside analysts. In addition, it would also be helpful if every doctor and all other providers with the authority to bill Medicare and Medicaid were required to have an ID card with a name, address, picture, unique billing number and a fingerprint or other biometric identifier. People who bill these programs should at least be prepared to prove that they are who they say they are.
Regarding Medicare Advantage, an executive of one of the large MA insurers recently passed on the following metrics to me: inpatient bed days per thousand members, -5% vs. standard Medicare; ER visits, -13%; specialist visits -27%; primary care visits, higher than standard Medicare. The program continues to grow in popularity, especially among the lower income seniors because it not only provides more and better benefits, it eliminates the need for Medi-gap coverage, which most of the lower income elderly cannot afford. Finally, Humana, the 2nd largest MA insurer, targets a 5% margin on this business before taxes and for Part D drug coverage as well. That’s hardly profiteering.
“federal law required a set amount of that premium be spent on additional benefits so it was impossible for it to increase their profits”
increased benefits at tax payer expense (with no documented improvement in health) = more enrollees = increased profit
Transferring beneficiaries from MA to FFS will also have the secondary effect of increasing Medicaid and Medicare Part D spending by almost $2.5 billion in 2017. This does not include higher out-of-pocket spending by patients for what will generally be lower levels of health care services.
“Finally, using FFS as a reference point for MA payments may be counterproductive and may actually penalize successful cost control by MA plans. Michael Chernew of Harvard University and his colleagues found that higher participation in MA managed-care plans is associated with lower per-beneficiary FFS spending at the county level.[10] The authors speculate that this may be due to a spillover effect from physicians who practice in a more efficient managed-care environment caring for their FFS patients in the same manner.”
If this study is accruate then MA has reduced cost in traditional FFS which saves tax payors money.
http://www.kff.org/medicare/upload/7744.pdf
This article is critical of PFFS but even in those you can see the benefits over traditional Medicare. More importantly 78% of people are in HMO MA plans and those had huge benefits for the participants. You could make an argument that PFFS should be discontinued but you can’t say MA HMOs served no benefit and just padded profits.
” Beneficiaries with incomes less than $10,000 per year make up 17 percent of Medicare enrollees and 16 percent of Medicare Advantage enrollees.”
“•The Center found that nearly half (45 percent) of all Medicare beneficiaries with incomes under $10,000 receive Medicaid, compared to only 10 percent who are enrolled in private plans.”
If that 10% wasn’t enrolled in MA plans they would be enrolled in Medicaid. How much does the 14% subsidy equote to compared to the cost of Medicaid? For those people MA saves the tax payor money.
“This additional cost did not contribute to better care for seniors.”
If dental and vision exams don’t lead to better health why are they considered under the Obamacare preventive care benefit? Both were suggested as requirements that would lead to better health. Not that liberals would ever argue both sides of an argument but it seems when your trying to bash MA plans all these extra benefits are worthless. Then when you try to bash private employer insurance the lack of these benefits is a problem.
“As a reminder, Medicare Advantage programs cost taxpayers 14 percent more than traditional, fee-for-service Medicare. This additional cost did not contribute to better care for seniors. It surely lined the pockets of the insurers with big profits.”
How can supposedly educated people still be so ignorant? Are they to lasy or to stupid to look up how these plans run and where the 14% went. FYI Dr. federal law required a set amount of that premium be spent on additional benefits so it was impossible for it to increase their profits. If you can’t get simple facts like that strait the rest of your post can’t be any better.
Simple….basic….facts…..