Skip to content
  • About
  • Contact
  • Contribute
  • Book
  • Careers
  • Podcast
  • Recommended
  • Speaking
  • All
  • Physician
  • Practice
  • Policy
  • Finance
  • Conditions
  • .edu
  • Patient
  • Meds
  • Tech
  • Social
  • Video
    • All
    • Physician
    • Practice
    • Policy
    • Finance
    • Conditions
    • .edu
    • Patient
    • Meds
    • Tech
    • Social
    • Video
    • About
    • Contact
    • Contribute
    • Book
    • Careers
    • Podcast
    • Recommended
    • Speaking

Demand parity among Medicare programs

Judith Stein
Policy
May 5, 2014
Share
Tweet
Share

What a shame: Reimbursement rates are going up for private Medicare Advantage plans.

Contrary to its April 7 announcement that private Medicare reimbursement rates would be reduced, the Centers for Medicare & Medicaid Services has just reversed course and announced that it will increase overall Medicare Advantage rates. The change in policy came after pressure from the political parties and insurance companies. As Medicare spending per beneficiary grows at a slower pace, subsidies to Medicare Advantage plans should also be reduced. Medicare Advantage should reflect actual market costs if we really want to improve Medicare financing and the federal budget.

Passed by Congress in 1997, Medicare Advantage is a means of receiving Medicare coverage through private insurance plans. Many advocates find that the system is fraught with difficulties, particularly when enrollees need post-acute care.  This is made worse by requirements that specialty care be pre-approved, and by an appeals system that is often arbitrary. Economic calculations — rather than quality of care — guide many coverage determinations.

The Centers for Medicare & Medicaid Services’ recent decision allows private Medicare to continue to cost more than traditional Medicare. While this may be good for the bottom line of insurance companies that offer Medicare Advantage plans, it is not good for Medicare, the vast majority of Medicare beneficiaries, or American taxpayers.

Why should we spend more of our limited public funds on private Medicare when traditional Medicare costs less? Why should taxpayers ensure private profits to deliver public Medicare coverage? After all, the experiment in privatizing Medicare was originally intended to see if a private model would cost less, while providing the same or better coverage than traditional Medicare. That was not to be.

Private plans left the market when their reimbursements were capped at or below the per capita price of public Medicare. The Centers for Medicare & Medicaid Services failed to learn from that experience, and maintain the cost of traditional Medicare as the maximum taxpayers would pay for private plans. Instead, since the Medicare Act of 2003 we actually pay private plans more than traditional Medicare.

This result is not good for the financial security of the Medicare program or for the federal budget deficit. It’s not good for the vast majority of beneficiaries who continue to choose the traditional Medicare program. It’s not even best for many Medicare Advantage enrollees, especially those with long-term and chronic conditions, who often get less coverage than they would in traditional Medicare. And remember, by design, Medicare Advantage plans have limited networks of providers, so private Medicare Advantage enrollees have fewer choices in physicians and other health care providers than they’d have in traditional Medicare.

The Center for Medicare Advocacy continues to call for parity in payments between private Medicare plans and traditional Medicare. It’s the best deal for taxpayers, the Medicare program, and the vast majority of Medicare beneficiaries. Common sense should prevail.

Judith Stein is executive director, Center for Medicare Advocacy.

Prev

Medicine takes something away from you

May 5, 2014 Kevin 5
…
Next

A toast to my patients

May 5, 2014 Kevin 1
…

Tagged as: Medicare

Post navigation

< Previous Post
Medicine takes something away from you
Next Post >
A toast to my patients

ADVERTISEMENT

More in Policy

  • Healing the doctor-patient relationship by attacking administrative inefficiencies

    Allen Fredrickson
  • The hidden health risks in the One Big Beautiful Bill Act

    Trevor Lyford, MPH
  • The CDC’s restructuring: Where is the voice of health care in the room?

    Tarek Khrisat, MD
  • Choosing between care and country: a dual citizen’s Independence Day reflection

    Kathleen Muldoon, PhD
  • How fragmented records and poor tracking degrade patient outcomes

    Michael R. McGuire
  • U.S. health care leadership must prepare for policy-driven change

    Lee Scheinbart, MD
  • Most Popular

  • Past Week

    • Why are medical students turning away from primary care? [PODCAST]

      The Podcast by KevinMD | Podcast
    • Why “do no harm” might be harming modern medicine

      Sabooh S. Mubbashar, MD | Physician
    • Here’s what providers really need in a modern EHR

      Laura Kohlhagen, MD, MBA | Tech
    • How New Mexico became a malpractice lawsuit hotspot

      Patrick Hudson, MD | Physician
    • Why doctors are reclaiming control from burnout culture

      Maureen Gibbons, MD | Physician
    • A world without vaccines: What history teaches us about public health

      Drew Remignanti, MD, MPH | Conditions
  • Past 6 Months

    • Why tracking cognitive load could save doctors and patients

      Hiba Fatima Hamid | Education
    • Why are medical students turning away from primary care? [PODCAST]

      The Podcast by KevinMD | Podcast
    • What the world must learn from the life and death of Hind Rajab

      Saba Qaiser, RN | Conditions
    • Why “do no harm” might be harming modern medicine

      Sabooh S. Mubbashar, MD | Physician
    • Here’s what providers really need in a modern EHR

      Laura Kohlhagen, MD, MBA | Tech
    • How the 10th Apple Effect is stealing your joy in medicine

      Neil Baum, MD | Physician
  • Recent Posts

    • From Founding Fathers to modern battles: physician activism in a politicized era [PODCAST]

      The Podcast by KevinMD | Podcast
    • From stigma to science: Rethinking the U.S. drug scheduling system

      Artin Asadipooya | Meds
    • The gift we keep giving: How medicine demands everything—even our holidays

      Tomi Mitchell, MD | Physician
    • The promise and perils of AI in health care: Why we need better testing standards

      Max Rollwage, PhD | Tech
    • From burnout to balance: a neurosurgeon’s bold career redesign

      Jessie Mahoney, MD | Physician
    • Healing the doctor-patient relationship by attacking administrative inefficiencies

      Allen Fredrickson | Policy

Subscribe to KevinMD and never miss a story!

Get free updates delivered free to your inbox.


Find jobs at
Careers by KevinMD.com

Search thousands of physician, PA, NP, and CRNA jobs now.

Learn more

View 2 Comments >

Founded in 2004 by Kevin Pho, MD, KevinMD.com is the web’s leading platform where physicians, advanced practitioners, nurses, medical students, and patients share their insight and tell their stories.

Social

  • Like on Facebook
  • Follow on Twitter
  • Connect on Linkedin
  • Subscribe on Youtube
  • Instagram

ADVERTISEMENT

  • Most Popular

  • Past Week

    • Why are medical students turning away from primary care? [PODCAST]

      The Podcast by KevinMD | Podcast
    • Why “do no harm” might be harming modern medicine

      Sabooh S. Mubbashar, MD | Physician
    • Here’s what providers really need in a modern EHR

      Laura Kohlhagen, MD, MBA | Tech
    • How New Mexico became a malpractice lawsuit hotspot

      Patrick Hudson, MD | Physician
    • Why doctors are reclaiming control from burnout culture

      Maureen Gibbons, MD | Physician
    • A world without vaccines: What history teaches us about public health

      Drew Remignanti, MD, MPH | Conditions
  • Past 6 Months

    • Why tracking cognitive load could save doctors and patients

      Hiba Fatima Hamid | Education
    • Why are medical students turning away from primary care? [PODCAST]

      The Podcast by KevinMD | Podcast
    • What the world must learn from the life and death of Hind Rajab

      Saba Qaiser, RN | Conditions
    • Why “do no harm” might be harming modern medicine

      Sabooh S. Mubbashar, MD | Physician
    • Here’s what providers really need in a modern EHR

      Laura Kohlhagen, MD, MBA | Tech
    • How the 10th Apple Effect is stealing your joy in medicine

      Neil Baum, MD | Physician
  • Recent Posts

    • From Founding Fathers to modern battles: physician activism in a politicized era [PODCAST]

      The Podcast by KevinMD | Podcast
    • From stigma to science: Rethinking the U.S. drug scheduling system

      Artin Asadipooya | Meds
    • The gift we keep giving: How medicine demands everything—even our holidays

      Tomi Mitchell, MD | Physician
    • The promise and perils of AI in health care: Why we need better testing standards

      Max Rollwage, PhD | Tech
    • From burnout to balance: a neurosurgeon’s bold career redesign

      Jessie Mahoney, MD | Physician
    • Healing the doctor-patient relationship by attacking administrative inefficiencies

      Allen Fredrickson | Policy

MedPage Today Professional

An Everyday Health Property Medpage Today
  • Terms of Use | Disclaimer
  • Privacy Policy
  • DMCA Policy
All Content © KevinMD, LLC
Site by Outthink Group

Demand parity among Medicare programs
2 comments

Comments are moderated before they are published. Please read the comment policy.

Loading Comments...