Barbara Quirk: Medicare tweak is a big victory

Barbara Quirk  —  7/20/2008 8:48 pm

This is a follow-the-bouncing-ball story. It begins with the Medicare Modernization Act in 2003, which established large federal subsidies for Medicare Advantage plans, essentially setting the stage for the privatization of Medicare. In the five short years since then, Medicare Advantage plans have been vigorously peddled and have become the fastest growing plans on the market.

As an aside, several of the larger companies who sell these plans have come under severe scrutiny for their marketing tactics, to the point that there have been Senate investigations. But that is another column.

In late June, House Ways and Means subcommittee Chairman Pete Stark, D-Calif., released a Government Accountability Office report. This report found that the private insurance companies administering Medicare Advantage plans have spent far less than projected on beneficiaries, while raking in an extra $1.4 billion of their $35 billion in profits.

The GAO examined plans representing 78 percent of Medicare enrollees, and found the programs spent less than 85.7 percent of their total revenue on medical expenses. "Private plans in Medicare spend even less on medical care that they report -- to the tune of over a billion dollars in one year alone," said Stark. "These funds go directly into the pockets of big insurance companies, not toward medical care for the beneficiaries."

Ruben Burks, secretary treasurer of the Alliance for Retired Americans, added, "This report provides hard evidence of what we have said all along -- these plans cost more to deliver less than traditional Medicare."

Meanwhile, the Senate twice failed to pass the Medicare Improvements for Patients and Providers Act of 2008.

At issue are the economic disincentives for physicians to limit, or outright refuse to take, new Medicare patients. While there are rising costs to care for older Americans, reimbursement is capped and preventive care is seldom covered.

Medicare, while a godsend for most older adults, is still a work in progress with inequities and false promises. The bills that had failed to pass proposed a number of changes, including raising the funding cap to ensure payments to serve populations in need. Medicare Part D late enrollment penalties would be eliminated.

One of the facets of the bills that I felt were critical was the improved coverage of preventive services.

Also critical are the discriminatory co-payments for Medicare outpatient mental health services. Those co-pays would gradually be reduced from 50 percent to 20 percent. One of my favorite books is "To Be Old and Sad." In it is the statement that if aging is depressing, something is terribly wrong. It speaks to mental health problems in an aging population and how they must be addressed.

In no particular order of importance, the bills would extend therapy cap exceptions through the end of next year and promise to improve access to ambulance services, particularly in rural areas.

These bills were strongly endorsed by the National Council on Aging, the Alliance for Retired Americans and other major senior groups. To no avail -- until July 9, when Sen. Ted Kennedy, who is fighting his own health problems, cast the decisive vote that would restore cuts in Medicare payments to doctors, signaling the stop of the creeping privatization of a system that has been enormously successful, if not perfect.

Paul Krugman, writing in the New York Times, calls this "the first major health care victory that Democrats have won in a long time" and calls it "enormously encouraging for advocates of universal health care."

There was a lot of political brinkmanship being played over the Fourth of July holiday and heavy-duty lobbying by the insurance companies. But, in the end, when the Senate came back in session, Kennedy was there to cast the extra vote needed to break a filibuster. Eventually a number of Republicans switched sides and the bill passed with a veto-proof majority.

What's next. Well, the president will veto the bill but that veto will be overturned. Then? Krugman predicts the beginning of the end to the privatization of Medicare.

How will it all play out? Krugman speculates that "the odds of achieving universal health care, soon, look a lot higher than they did just a couple of weeks ago."

Barbara Quirk is a Madison geriatric nurse practitioner. TANDBQUIRK@aol.com

Barbara Quirk  —  7/20/2008 8:48 pm