Medical Insurance Blog

Could Recipients of Medicaid Purchase Insurance on Exchanges in 2014?

As state officials decide whether or not to drop out of the federal/state Medicaid program, the question lies if poor people would be able to receive subsidies to help them purchase medical insurance coverage in an insurance exchange in 2014.

The U.S. Department of Health and Human Services is contemplating that question, according to the federal center of Medicaid and State Operations.  The answer to this question will ultimately determine who is responsible, the federal government or states, for the medical care of low income Americans, who amount to millions.  Right now, the federal government and states share the cost for 49 million people on Medicaid.  The new healthcare reform law is planning on adding an additional 16 million people to Medicaid, starting in 2014.

According to the new healthcare reform law, anybody that's under 133% of the federal poverty level for a family of four ($29,237) will go onto Medicaid.  There's just one exception, which is legal immigrants that are poor, who will receive subsidies to purchase private medical insurance.  The law says that just applicable taxpayers who have an income of 100% above the poverty level are able to receive subsidies. 

That leaves a question for one category of U.S. residents: those people that have an income between 100%-133% of the poverty level.  Those people may be eligible to receive subsidies.

However, the only method of ejecting a particular category of U.S. residents from Medicaid is for the state to get a waiver from the Department of Health and Human Services.  That waiver may or may not be approved, depending on who is elected the presidency in 2012.

Meanwhile, the Department of Health and Human Services have declined to state when or whether they'd make this clarification.

MEDICARE INSURANCE PAID $47 BILLION IN SUSPECT CLAIMS

The government paid more than $47 billion in questionable Medicare claims including medical treatment showing little relation to a patient's condition, wasting taxpayer dollars at a rate nearly three times the previous year.

Excerpts of a new federal report, obtained by The Associated Press, show a dramatic increase in improper payments in the $440 billion Medicare program that has been cited by government auditors as a high risk for fraud and waste for 20 years.

It's not clear whether Medicare fraud is actually worsening. Much of the increase in the last year is attributed to a change in the Health and Human Services Department's methodology that imposes stricter documentation requirements and includes more improper payments -- part of a data-collection effort being ordered government-wide by President Barack Obama this coming week to promote "honest budgeting" and accurate statistics.

Still, the fiscal 2009 financial report covering the first few months of the Obama administration highlights the challenges ahead for a government that is seeking in part to pay for its proposed health care overhaul by cracking down on Medicare fraud. While noting that several new anti-fraud efforts were beginning, the government report makes clear that "aggressive actions" to date aimed at reducing improper payments had yielded little improvement.

In recent years, the suspect claims have included Medicare prescriptions from doctors who were dead, and requests for payment for medical supplies such as blood glucose strips for sexual impotence and diabetic shoes for leg amputees. Patients, many of them new citizens who barely speak English, are sometimes recruited by brokers who go door-to-door offering hundreds of dollars for use of their Medicare numbers.

Obama is expected to announce new initiatives this coming week to help crack down on Medicare fraud, including a government-wide Web site aimed at providing a fuller account of health care spending and improper payments made by various agencies. The Centers for Medicare and Medicaid Services also will launch a Web interactive next month that will allow users to track Medicare payment information by categories such as state, diagnosis and hospital.

According to the report, the Bush administration from 2005-2008 reported improper payments of roughly 4 percent in the fee for service program, or about $17 billion total in 2008. Government officials at the time, however, typically did not consider a Medicare payment improper if the medical documentation was incomplete or a doctor's signature was illegible. Since these were flaws that ordinarily bar payment, that methodology drew complaints from government auditors that the figures were understated.

For fiscal year 2009, the Obama administration began counting those claims as improper, but was unable to complete an official tally based on the new methodology. As a result, it officially reported improper payments for its fee for service program at 7.8 percent, representing a partial tally under the new formula. But it considers the unofficial tally of 12.4 percent to be more representative.

Beginning next year, the 12.4 percent figure or a total of $47 billion in improper payments when counting both Medicare fee for service and managed care will be used as the baseline estimate. The federal report sets a target of reducing improper payments in the fee for service program to 9.5 percent by next year, which would represent a savings of roughly $9.7 billion.

The findings come as the Obama administration is making Medicare anti-fraud efforts an important priority. In recent months, HHS has said it was multiplying by 10 the number of agents and prosecutors targeting fraud in Miami, Los Angeles and other strategic cities where tens of billions of dollars are believed to be lost each year. The new partnership seeks to have better sharing of real-time intelligence data on health care fraud patterns.

Officials say they also want to increase training and outreach among Medicare providers to reduce documentation errors, while proposed health overhaul legislation would increase background checks on Medicare claimants and impose stiffer penalties for false claims.

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Medicare medical insurance Supplements Can Save You Money

 

By definition, a supplement is something you use to improve something you already have, like supplementing your cable television package or your health care insurance. Many people are surprised that health care, or the original Medicare, was never complete when it was designed. Maybe it was sufficient in its inception; however, as time passed it became apparent that large gaps had developed between what Medicare covered and what other private health insurance policies covered. The solution to this health care problem was solved by creating Medicare supplement insurance policies that are sold by private medical insurance companies.

The Medicare supplement policies, also known as "Medigap," fill in the gaps that are left by the original Medicare health insurance program. Supplements are used to reduce out-of-pocket medical expenses that you'd otherwise have to pay for yourself, depending on your plan choice (Medigap policies come in parts A-J). Under this plan, Medicare and Medigap work together to pay health care costs that most people could never afford on their own.

In each state, Medigap policies are federally mandated and each policy offers the recipient a certain set of benefits. This standardization practice ensures that Medicare doesn't change from state to state. However, standardized doesn't mean that Medicare doesn't make choices available to fit the various situations of Medicare recipients. Actually, there are 10 different parts lettered A through J, with A being the part that must be offered in every state, and F being the most popular part. This allows for plenty of health coverage choices.

Each Medigap part offers a specific set of basic and bonus benefits. Part A is mandated and parts B through J are only offered if the insurance company desires to offer them. Also, there are two points you should be aware of: Part A is only accessible to people with no medical coverage due to a disability. Secondly, Medicare combined with Part A is the most basic level of coverage.

In addition, it is important to shop around for different rates because you can actually save money on Medicare/Medigap combo deals. This is due to the fact that this is the only area (Medigap) where insurance companies are permitted to set their own rates in relation to the market. Every company offers a standard package but the price you pay will vary. Remember to call around to find the best rate.

One additional note: If you are considering a Medigap policy, you must already have Medicare Parts A and B. There are specifics to take into account, so it is best to speak to a local insurance broker who can walk you through the details of Medicare. Their advice is free and you can take advantage of their services and save yourself plenty of online research time. Also, using knowledgeable sources of information to choose the right Medicare supplement plan will allow you to save money by making the right medical insurance choice for your situation.

A Policy View of Medicare medical insurance Reimbursement Cuts

 

Medicare reimbursement cuts have skyrocketed since Medicare's beginning in 1965, despite many different measures to control growth. Short-term legislative fixes have been buying time in order to develop long-term solutions while numerous stakeholders stand to win and lose as they deal with reimbursement cuts. Among these stakeholders are politicians, the federal government, Medicare recipients, healthcare providers, and third-party payers. There are anticipated problems in implementing reimbursement cuts, including obstacles to patient care and the financial capability of healthcare providers who rely on Medicare revenue. Continual questions over short-term Medicare cuts will be eclipsed by policy modifications related to the program's ability to sustain long-term healthcare funding and delivery systems.

Introduction

Currently health care spending accounts for 16% of the gross domestic product of the United States (Getzen, 2007). Overall health care spending and high health care costs are due to new technology and higher incomes. This raises the question, how are health care expenses going to be controlled within government programs like Medicare? The development of Medicare and Medicaid by the Social Security Acts of 1965 recognized the government as a major financier in health care. Hospitals and other institutions were allowed to grow in size, capacity, and capital due to regular reimbursement through government funding.

Background and Significance

Medicare has progressed in numerous ways since its beginning in 1965. Initially, physicians were compensated by the program for services covered and were able to bill their patients for costs that were not covered. Hospital compensation plans also followed similar patterns until a modification was made in 1983 from "reasonable cost" to the prospective payment system based on groups that were diagnostically-related. In 1992 the charge-based system was replaced by the physician fee schedule. To control spending even further, the Sustainable Growth Rate (SGR) of 1998 was created. With this, the annual goals for spending are established and physician payments are reduced if spending goes over these limits.

The majority of today's Medicare costs are unlike those of the past. A large percentage of the expenses are attributable to outpatient services covered by Medicare Part B. This percentage has consistently exceeded the established formula that is specified in the SGR. Imminent adjustments that come in the form of reimbursement cuts mean major problems for any physician that receives reimbursements for services provided to their Medicare patients. These cuts will have a major impact on hospitals and physicians, and they may worsen access barriers to healthcare for Medicare recipients. New reimbursement cuts are especially troubling in light of evidence that the expansion of Medicare reimbursements to new areas of care can benefit patient health (Gross et al., 2006). Legislation and actions on Capitol Hill generally determine the types and amounts of cuts to be made.

Legislation

Legislative action related to Medicare cuts is unending. A recent (February 14th, 2008) amendment was proposed in the House of Representatives to amend conversion factors in Part B of title XVIII of the Social Security Act, which increased Medicare payments for physicians' services through December 31, 2009. These modifications are temporary fixes in the challenge to produce long-term solutions, and legislative fixes are subjective to the various groups that are involved with these cuts. Congress is endlessly tweaking legislation related to reimbursement in order to slow down uncontrolled growth while acknowledging the constituencies and interest groups.

The executive branch also plays a major role in Medicare cuts. Recently, the Bush Administration proposed a measure to control the elevated growth in the program. This change was initiated by a condition of the 2003 Medicare law. When a financial alert is released by Medicare trustees, the administration is mandated to present legislation that reduces program spending or increases revenue.

Stakeholders

The major stakeholders in this Medicare issue are the federal government, politicians, Medicare recipients, physicians, hospitals, and third-party payers. The federal government is in position to win by moderating the uncontrolled growth in the Medicare program. In recent years, the total expenses and federal reimbursement has exceeded the goals that have been set. The growing size of Medicare threatens to infringe upon other fund sources and programs. To reform Medicare and keep expenses within manageable boundaries, it is in the best interest of the federal government to take charge. Regardless of the benefits involved in implementing cuts, the types of cuts made have potential repercussions. Cuts to reimbursements are controversial within the healthcare community, so the federal government must implement responsible controls to ease harm and allow reform.

Politicians are another group that is affected by reimbursement cut policies. Their role is fairly involved as their responsibilities and functions are reflective of the interests of different groups and political parties. Reduction of expenses and reimbursement cuts affect constituents in many ways. In political decision-making, the role of Medicare reimbursement cuts depends on how these groups are affected, and the amount of healthcare lobbying that happens on Capitol Hill shows the magnitude of the interests involved.

Additionally, third-party payers are heavily influenced by Medicare reimbursement tactics. Medicare reimbursement cuts may mean reimbursement cuts by other third-party payers, thus adding to many of the problems that healthcare providers experience.

Understandably, Medicare recipients are another leading group affected by cuts because that means the reduction of programs and benefits to these recipients. Patients have been provided with a vast array of services, procedures, and pharmaceuticals due to technological advancement. If benefit and program cuts occur, these technological features will be greatly reduced. Reimbursement cuts may also play a part in preventing easy access to care. New Medicare patients may be less likely to be accepted by providers due to lower reimbursements from Medicare. In the short-term seniors will always suffer from reimbursement cuts but they may benefit in the long-run from a more efficient delivery system resulting from Medicare reform.

Physicians and hospitals will always lose in the short-term. The healthcare community does not agree with current reimbursement models and believes that any additional cuts will significantly wear down revenues. Many physician practices and hospitals will be greatly affected but they may benefit in the long-run from programs that are moderated in growth.

Implementation issues

There are many groups engaged in searching for answers to this problem, including the Medicare Payment Advisory Commission (MedPAC), the Government Accountability Office, physician and hospital organizations, economists, and other interest groups. The U.S. Senate and House of Representatives are working separately on ways to reduce the irregularities in expenses and reimbursements while trying to set up long-term solutions to these issues. One of the most significant challenges to implementation is the financial domino effect to providers relying on reimbursements (hospitals, physicians, providers). Medicare medical insurance accounts for a large part of revenues to health facilities and healthcare providers. Any lessening of reimbursements for services will generate a major financial impact and the healthcare community has been very resistant to any additional cuts. Some of the noisiest groups have been health providers and interest groups affiliated with them.

Future direction

Reduction of Medicare reimbursement is a major policy issue that affects a large section of interests. Within the government it is acknowledged that more time is required to generate sustainable strategies. The ability to balance long-term objectives with the immediate effects of cuts is a sensitive matter. Policymakers must make calculated decisions when it comes to reducing healthcare spending. Some proponents believe that a greater concentration on preventive care can potentially alleviate expense trends. A large portion of current expenses in Medicare and other programs comes from long-term maintenance of chronic conditions. This tendency accounts for a large part of growth that is not controlled. These reimbursement cuts are only temporary strategies in a losing battle, but a greater concentration on preventive care can potentially extend the viability of U.S. healthcare systems.

Choosing The Right Medicare Plan For You

For many people that are eligible for Medicare, just beginning to look over all of the different types of healthcare coverage can be very confusing. As you know, having options is often a very good thing. But with all of the healthcare plans available, how do you make a decision that will be right for you?

Those that have reviewed the many options with Medicare know that it is simply nothing but choices. Depending upon your situation, you may decide to stay with traditional Medicare, known as Medicare Parts A and B. If you choose this plan, it is recommended to obtain a Medicare Part D (prescription drug) plan as well. Medicare Part D ensures that all of your medications are covered.

Or, you may take a look at a Medicare Advantage plan, which combines traditional Medicare coverage plus prescription coverage and many other benefits. You may also be interested in a Medigap (supplemental) plan that offers even more coverage than the Advantage plan.

With all the options that Medicare includes, many people just give up due to confusion. Fortunately, help is available. To get the most out of your healthcare insurance choices, you should be advised by a knowledgeable source. A Medicare advisor offers information and guidance on available Medicare programs, detailed action plans tailored to your situation, and answers all of your questions. And before you speak with an advisor, research the basics of Medicare.

Traditional Medicare

Medicare Parts A and B were part of the original Medicare Program. This traditional form has been around since 1965. For most people that have worked and paid Medicare taxes for a minimum of 10 years, Medicare Part A is free. Part A covers in-patient hospital care, and Part B, which cost an average of $96.40 in 2009, covers out-patient medical care.

Anyone that has the traditional form of Medicare can visit any doctor they choose in any hospital or office. They do not need a referral from another doctor as long as that doctor, hospital, or office accepts patients with Medicare. However, the benefits of traditional Medicare are very limited.

Traditional Medicare does not cover most out-patient prescription drugs. If a Medicare recipient needs prescription drug coverage often, then costs can become very high. This is why Medicare Advantage and Medicare Part D plans are available for purchase.

Medicare Advantage Plans

Medicare Part C, also known as Medicare Advantage, combines Parts A and B into one plan. This allows the Medicare recipient to get their Medicare Part A and Part B coverage all in one place. Medicare Advantage plans generally include prescription drug coverage and many other benefits that are not normally found under traditional Medicare, such as dental and vision services.

The Medicare Advantage option works just like private insurance - you choose from different types of plans depending upon what type of provider access you would like (for example, preferred provider organizations (PPO) and health management organizations (HMO). It also depends upon your health condition and any prescription drugs you are taking.

Medicare Advantage plans also offer many different levels of coverage, and they all offer as much coverage as the traditional Medicare plan. For instance, if the plan covers prescription drugs, that coverage must meet the minimum standards of Medicare Part D.

Medicare Part D

Medicare Part D has been put in place to cover prescription drug costs. Similar to Medicare Advantage, Part D is available through private companies who are reimbursed to provide healthcare coverage to those under Medicare Part D. There are many different plans offered in the United States, and some have many different levels of coverage. Also like Medicare Advantage, there is a minimum coverage amount required for a plan to qualify as a Medicare Part D plan. Those who take prescription drugs, but don't need to see their doctors regularly, are the best candidates for Medicare Part D

Medicare supplemental plans, or Medigap, are sold by private companies to fill the "gaps" that exist in traditional Medicare. In 2009, there are 12 different Medigap plans, labeled A through L. The cost of deductibles, co-payments and coinsurance are included in Medigap, and it may also cover services that Medicare does not insure.

Although Medigap may cover additional costs, if a person chooses to keep traditional Medicare, that person can't buy a Medigap plan if they have Medicare Advantage. Having both plans is unnecessary because most Medicare Advantage plans offer better coverage and benefits than the Medigap plan. It is simplest and cheapest to just purchase a Medicare Advantage plan instead of having both Medigap and Medicare Part D.

Choosing the Right Plan for You

As you can see, choosing the right plan on your own can be a very difficult task. There are thousands of plans offered in the United States, with an average of 40 Medicare Advantage and Medicare Part D plans in different regions. This is why using a Medicare advisor is so important. With so many options, choosing a plan is difficult when you do not understand what each one covers or doesn't cover. The use of a Medicare advisor can help you choose the right Medicare coverage plan choice for your situation.