...and yet another newspaper editorial exposing Medicare advantage plans?

Medicare disadvantage

A House bill attempts to keep doctors in the health-care program and curb a misguided and expensive subsidy for private insurers

Ohio.com, July 8, 2008
On today's Commentary page, Alan J. Bleyer, the president and chief executive officer of Akron General Medical Center, describes the steep challenge of curbing the overall cost of health care. No part of the task is greater than corralling Medicare spending, Bleyer reminding that the program's trustees recently reported that the Medicare trust fund will be depleted in 10 years. With such a prospect in mind, a bipartisan majority of the U.S. House approved legislation that would slow the flow of public dollars to private Medicare Advantage plans.

The hope was, the Senate would give its nod before the July Fourth recess. Unfortunately, the measure stalled. Senate Republicans and the White House argue the bill would harm retirees enrolled in Medicare Advantage. They vastly overstate the danger.

Neither Democrats nor Republicans, senators nor representatives, deserves applause for their fiscal management of Medicare. Still, the House bill would address two pressing matters.

First, the legislation would prevent a scheduled 10.6 percent reduction in payments to doctors who care for millions of older Americans. A fee increase? That saves money? Truth be told, doctors have been steadily squeezed in recent years. The concern now is that physicians will flee Medicare, frustrated with the puny reimbursements, damaging the program in another way. That explains the targeted ad campaign of the American Medical Association, seeking to pressure key Senate Republicans.

What the House seeks (responsibly) is to cover the cost of the payments to doctors. It would do so by requiring Medicare Advantage plans to compete more equally with other program options. As the Center for Budget and Policy Priorities points out, the added competition would likely ease the growth of the private plans, and thus save money.

The Medicare Payment Advisory Commission (a congressional oversight operation) has been harshly critical of Medicare Advantage, concluding that certain of these private insurance plans cost 17 percent more to cover a beneficiary than under regular Medicare. The commission noted that much of the excess goes into administrative expenses, marketing and plain profit. The Congressional Budget Office calculated last year that such padding would cost an added $149 billion during the next 10 years.

Tellingly, Mark McClellan, a supporter of Medicare Advantage and a former administrator of the Centers for Medicare and Medicaid Services under President Bush, called last year for repairing the unfair competitive advantage enjoyed by key private Medicare plans. The House bill follows his cue. It would require these plans to do as others are required: establish provider networks and collect data on the quality of health care. Such information should aid patients, doctors and taxpayers.

The subsidies for Medicare Advantage plans were established to purchase participation. The price becomes too expensive when doctors face a financial squeeze that pushes many out of the program. These changes hardly address all that ails Medicare financially. They do reflect recognition that soon enough, the program will struggle to make ends meet.

From John Curry