Breaking Fight loomsover MedicareAdvantage, which Obama administration wants to

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Breaking Fight looms over Medicare Advantage, which Obama administration wants

to trim

 

 

Tribune Newspapers

 

August 19, 2009

 

http://www.courant.com/news/breaking/hc-tc-nw-medicare-0818-0819.artaug19,0,6867\

523.story

 

WASHINGTON - — With the wildfire over so-called death panels still smoldering,

President Barack Obama faces what could become another emotion-charged obstacle

to his vision of overhauling health care: his plan to trim subsidies for a

program called Medicare Advantage.

 

The program pays insurance companies a hefty premium above traditional Medicare

reimbursements for enrolling senior citizens in managed care. But whether the

higher payments are worth the cost is a matter of dispute.

 

Obama and many congressional Democrats see Advantage as a wasteful bonanza

averaging about $17 billion a year for the companies, which critics say provide

few benefits beyond regular Medicare.

 

And cutting out the extra pay is crucial to financing the Democrats' health care

overhaul.

 

The companies and their supporters say they earn the extra payments by providing

seniors with significant additional benefits. And many Medicare recipients—who

may pay nothing for the " extras " —seem to agree.

Almost a quarter of all Medicare beneficiaries are now enrolled in " Advantage "

programs.

 

Though scaling back " Advantage " payments would have no effect on the majority of

regular Medicare users, it does create an opening for opponents to allege that

Obama will cut Medicare benefits.

 

Obama and his supporters acknowledge the risk.

 

" This will not be painless, " said Robert Berenson, a physician and health care

policy analyst at the liberal-leaning Urban Institute.

 

The White House is counting on convincing seniors that in order to fix the

health care system, the fat must be cut out of one part of it.

 

For the past few years, Medicare Advantage has been a sheltered corner of the

national health plan. When congressional Republicans first began expanding

private insurance Medicare options in 1997, advocates argued the plans would

deliver services more efficiently, and hence less expensively, than Medicare's

traditional fee-for-service reimbursement.

 

As a result, the private plans now cost the government about 14 percent more per

person than regular Medicare, according to an analysis by the Medicare Payment

Advisory Commission, which recommends reimbursement rates to Congress.

 

" Payment increases have been so large that plans no longer need to be efficient

to attract enrollees, " MedPAC's executive director, Mark Miller, told Congress

in June 2008.