Health-care bill would cut Medicare HMOs gradually

South Florida Medicare patients who are enrolled in HMOs plans could face a potential loss of extra benefits if a health-care bill clears Congress, but probably not for at least a few years. It’s hard to know for sure, but the bill unveiled by House leaders on Thursday appears headed in that direction. The bill would gradually cut spending on Medicare Advantage plans, but a phase-in period would cushion the blow to current enrollees, allowing them time to adjust. White House officials, who helped craft the compromise, say the idea is to cut excess spending on these plans without disrupting patients already enrolled or discriminating against those who have not signed up. These plans – which typically provide such goodies as low premiums, dental care or gym memberships – would have to make do with less money over time. That might make it hard for them to continue the same level of benefits. The new provision was tucked into a “reconciliation bill” the House will consider, which would revise the Senate version of health reform. House leaders plan to approve the Senate version this weekend, then pass the reconciliation bill as a separate-but-related measure. The reconciliation bill would alter a provision that Florida Senator Bill Nelson injected in the Senate bill. Some Democrats were uncomfortable with Nelson’s amendment. Republicans attacked it as “Gator-aid” because it was tailored to preserve benefits for patients in South Florida, where Medicare HMO plans are relatively efficient and highly popular. The White House sought a remedy that was not geared to any one part of the country. “No, there aren’t special deals in there for Florida, Arizona, California, New York and the other states,” Nancy-Ann DeParle, director of the White House Office

of Health Reform, told reporters earlier this week. “The formula is fair and phases down the benefits in such a way that it doesn’t penalize the seniors who haven’t signed up for this.” Senator Bill Nelson Nelson’s staff said he was still studying the new version. A spokesman passed along this description from the Kaiser Family Foundation, a non-partisan expert on health care: “Government payments to Medicare Advantage, the private-health plan alternative to traditional Medicare, would be cut back more steeply than under the Senate bill: $132 billion over 10 years, compared to $118 billion. “The government currently pays the private plans an average of 14 percent more than traditional Medicare. The new bill, besides reducing payments overall, would shift the funding; some high-cost areas would be paid 5 percent below traditional Medicare, while some lower-cost areas would be paid 15 percent more than traditional Medicare. “The Senate’s plan that would have shielded some areas of the country, such as South Florida, from major cuts was largely eliminated.” The House Rules Committee said the new provision would make no change in payments to Medicare Advantage payments in 2011 but would begin reducing them in 2012. “The changes will be phased-in over three, five or seven years, depending on the level of payment reductions,” the Rules Committee said. “The provision creates an incentive system to increase payments to high‐quality plans by at least 5 percent.” So we’re talking about a gradual reduction that would not begin for at least a year. The impact would vary from place to place and from plan to plan, leaving the future of HMO benefits somewhat uncertain.

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Health-care bill would cut Medicare HMOs gradually

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