By Paul Ryan
Representing Wisconsin's 1st Congressional District
President Obama has promised that if you like the health coverage you have now, you can keep it. Medicare beneficiaries across the country, including nearly 900,000 here in Wisconsin, have voiced their legitimate skepticism with this promise. So, the President took it a step further, telling seniors at a recent AARP event, “Nobody is talking about cutting Medicare benefits.” Yet again, we find a yawning gap between the President’s rhetoric and the actual substance of the legislation being pushed through Congress.
In order to pay for the trillion dollar health care overhaul making its way through Congress, hundred of billions of dollars will come from new tax hikes, hundreds of billions of dollars will be borrowed, and hundreds of billions of dollars will be cut from Medicare. I realize that the President promised not to cut Medicare benefits, but the proposed bills do exactly that.
Testifying before the Senate Finance Committee, Congressional Budget Office (CBO) Director Doug Elmendorf stated plainly that these changes “would reduce the extra benefits that would be made available to beneficiaries through Medicare Advantage plans.” The CBO has previously stated that these Medicare Advantage cuts “could lead many plans to limit the benefits they offer, raise their premiums, or withdraw from the program”. Specifically, Section 1161 of H.R. 3200 (page 331) cuts $156.3 billion from Medicare Advantage. As a practical result of this legislation, an estimated six million current Medicare Advantage beneficiaries would no longer be able to afford their current plans or lose access all together.
Medicare Advantage is a program that fills the gaps from the traditional Medicare benefits, utilizing approved private plans to offer seniors additional benefits at lower costs. Emphasizing integrated and preventative care, Medicare Advantage tailors benefit plans to patients’ needs, putting quality over quantity.
This innovative delivery of coverage and care is a favorite target of Washington. In 1997, a similar option was made available to seniors, then called Medicare+Choice. But year after year, the reimbursement rates were cut for these plans, making it increasingly unattractive for private providers to offer plans. As a result of inadequate federal reimbursements, seniors in Southeastern Wisconsin were dropped from Humana and United Health Care’s Primecare Gold plans. Prior to dropping coverage in 1999, Primecare Gold had 1,965 enrollees in Racine County and 590 in Kenosha County.
I held multiple Medicare town hall meetings for those hit hardest by these decisions, and vividly recall the difficult experiences shared by seniors in the area. While Blue Cross Blue Shield, in conjunction with All Saints Healthcare System, stepped up to offer a Medicare+Choice plan option to those who were losing coverage from the Humana/Primecare Gold plans, the Medicare reimbursement rate remained broken and this new option quickly met a similar fate. As a result of these Blue Cross Blue Shield plans being dropped in 2001, roughly 10,000 beneficiaries in Southeastern Wisconsin were adversely affected. When Wisconsin seniors lost access to these popular Medicare+Choice plans, the consequences were painful and the vocal anger was justified.
In 2003, the program evolved into what is now known as Medicare Advantage, and Congress is threatening to repeat the same mistakes. Nearly a quarter of all Medicare beneficiaries in Wisconsin, including a disproportionate number of African-Americans, Hispanics, and seniors living in rural communities, have enrolled in Medicare Advantage plans. There are also countless “snowbirds” that reside in warmer climates in the winter that have made clear to me their preference for Medicare Advantage plans. One of the obvious advantages of this program is seniors need only pay one deductible and one form of co-pays, while all of Medicare’s component parts (Part A, B, C & D) are folded into one integrated program.
Despite the increasing popularity of Medicare Advantage and the President’s promises to protect seniors’ benefits, this patient-centered coverage option is again on the chopping block.
If all of this is coming as a surprise, the problem runs deeper than politicians failing to be frank with the American people. The federal government has actively sought to silence providers’ warnings to their customers of these pending cuts. It was recently uncovered that the Centers for Medicare and Medicaid Services (CMS), a division the U.S. Department of Health and Human Services, placed a gag order on Medicare Advantage providers for sharing information with their enrollees about pending changes to their plans. Without regard for private health care plans’ right to inform their enrollees about consequential legislation, CMS has launched an investigation against Humana for mailing a factually verified warning about proposed cuts.
The Administration’s actions open an array of troubling questions on both the appropriateness and legality of such political intimidation. In both tactics and substance, the Medicare Advantage issue reminds Wisconsinites of their continued frustrations with how Washington operates.
Medicare Advantage represents a perfect example of how Congress ought to fix what’s broken, rather than break what’s working. I believe that Medicare Advantage’s bureaucratic formula hinders true competition, which benefits insurance companies at the expense of seniors receiving the care and taxpayers footing the bill. I have introduced legislation, H.R. 2520, The Patients’ Choice Act, which includes a provision to force Medicare Advantage plans to compete against each other. Competitive bidding would allow the market, not a bureaucratic formula, to set reimbursement rates for Medicare Advantage plans.
Unfortunately, the President and Congress have gone far beyond this common sense reform, as the legislation being pushed through Congress would dramatically increase premiums for seniors or simply kill Medicare Advantage outright. The 216,615 Wisconsinites and the 10.5 million Americans nationwide enrolled in Medicare Advantage plans deserve better.
There is no doubt that health care in America, including Medicare and Medicaid, are in need of serious reform. Serious reform requires a serious conversation. Rather than drastic Medicare Advantage benefit cuts, I believe competitive bidding would provide a more equitable and efficient reimbursement mechanism for the program. Rather than perpetuate false promises, I believe responsible leaders should level with Wisconsin’s seniors.