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Retiree Health Benefits at a Crossroads

  
  
  

Medicare Supplements Retiree health benefit plans are an important source of supplemental coverage for roughly 15 million Medicare beneficiaries. But the state of retiree health coverage is at a critical juncture after decades of change, with still more to come on the horizon. A new report by the Kaiser Family Foundation reviews the role of retiree health coverage for early and Medicare-eligible retirees, examines changes underway, and considers the outlook for the future.

The Fed raised 2014 base payments for Advantage insurers by 3.3% last year, after initially proposing a 2.2% reduction. CMS scraped up part of the 2.5% increase in the actual bidding benchmark by changing the way it calibrates one Medicare Advantage risk management program and slowing the phase-in of another risk management program that could have decreased the benchmark Medicare Advantage plans earned an average profit of 4.5% for insurers in 2011, according to the Government Accounting Office. Nearly 16 million people are enrolled in Medicare Advantage plans, accounting for roughly 30% of all eligible beneficiaries, up about 9% from 14.6 million last year. The Congressional Budget Office projects Medicare Advantage enrollment will hit 21 million by 2023.

The report concludes that under continuing pressure from rising costs, retiree health strategies of employers are now undergoing accelerated transitions and that the direction and pace of future changes will also be very sensitive to shifts in public policy. Several major trends stand out in particular, namely, growing interest in shifting to a defined contribution approach and in facilitating access to non-group coverage for Medicare-eligible retirees, and consideration by employers of using new federal/state marketplaces as a possible pathway to non-group coverage for their pre-65 retiree population.




In terms of future retirees, one would expect the employer plan to respond in ways that reflect the Medicare changes, including by making changes in the retiree plan design, or the employer contribution to the plan, or in the way the plan coordinates with Medicare, or adopt an approach that we have noted above is a growing trend, namely, providing the retiree with a defined contribution amount that the retiree can use to purchase an individual Medicare or Medigap plan, as opposed to the employer group plan.

THE REPORT: http://kaiserfamilyfoundation.files.wordpress.com/2014/04/8576-retiree-health-benefits-at-the-crossroads.pdf

 

Additional Updates:

CMS Increases Medicare Advantage Rate By 0.4%

  
  
  

Medicare Supplements Federal regulators on Monday boosted planned payments to insurers that run private Medicare Advantage plans, issuing final rates that were higher than the cuts regulators proposed in February. The Fed will increase the overall rate it pays Medicare Advantage plans by 0.4% in 2015, despite a proposed policy issued in February that signaled a 1.9% cut. Analysts said the final 2015 rates still appeared to reflect a reduction in payments (as much as 3%) compared with 2014. The increase came as a surprise.

The Fed raised 2014 base payments for Advantage insurers by 3.3% last year, after initially proposing a 2.2% reduction. CMS scraped up part of the 2.5% increase in the actual bidding benchmark by changing the way it calibrates one Medicare Advantage risk management program and slowing the phase-in of another risk management program that could have decreased the benchmark Medicare Advantage plans earned an average profit of 4.5% for insurers in 2011, according to the Government Accounting Office. Nearly 16 million people are enrolled in Medicare Advantage plans, accounting for roughly 30% of all eligible beneficiaries, up about 9% from 14.6 million last year. The Congressional Budget Office projects Medicare Advantage enrollment will hit 21 million by 2023.

Additional Updates:

Summary of Medicare Provisions in Budget for Fiscal Year 2015

  
  
  

Medicare Supplements This is a brief summary of the Medicare provisions included in the federal budget proposal for FY2015: if adopted, it would reduce Medicare spending by more than $400 billion between 2015 and 2024, accounting for about 25 percent of all reductions in federal spending included in the budget. More than one-third (34%) of the proposed Medicare savings are due to reductions in payments for prescription drugs under Medicare Part B and Part D. (UPDATED YESTERDAY). One-third (33%) of the proposed Medicare savings are due to reductions in Medicare payments to providers. About 16 percent of the proposed Medicare savings are due to increases in beneficiary premiums, deductibles and cost-sharing.

Figure 1: Distribution of Medicare Savings in President Obama’s FY2015 Budget

Figure 1: Distribution of Medicare Savings in President Obama’s FY2015 Budget

Summary of Medicare Provisions in the President’s Budget

Beneficiary Premiums, Deductibles And Cost-Sharing

  • Income-Related Part B And Part D Premiums
  • Part B Deductible
  • Home Health Copayment
  • Surcharge On Medigap Coverage
  • Part D Copayments

Dual-Eligible Beneficiaries

  • Program for All-Inclusive Care for the Elderly (PACE) Program
  • Appeals Process
  • Qualified Individuals

Other topics discussed in more detail include:

Medicare Advantage, Prescription Drugs, Physician Payments and the Sustainable Growth Rate (SGR) Formula & Medicare Payments to Other Providers

To review the full story please follow this link: http://kff.org/medicare/issue-brief/summary-of-medicare-provisions-in-the-presidents-budget-for-fiscal-year-2015


Source: Kaiser Family Foundation

Additional Updates:

 

Obama's Not-So-Secret War On Private Medicare Plans

  
  
  
Medicare Supplements To say that President Obama is not an enthusiastic backer of the two Medicare programs that offer seniors private insurance options would be something of an understatement.

Over the years, Obama has repeatedly derided Medicare Advantage — the program that lets seniors enroll in subsidized, private insurance. He once called it "wasteful," and said it amounted to "giveaways that boost insurance company profits but don't make (seniors) any healthier."

Obama has been equally harsh when it comes to Medicare Part D — the drug benefit President Bush signed into law that relies on privately run plans.

In his 2006 book, "The Audacity of Hope," Obama blasted the program, saying it "somehow managed to combine the worst aspects of the public and private sectors." As president, he said it gave overly generous "taxpayer subsidies to prescription drug companies."

Both programs, it turns out, have been wildly popular with seniors and, by most measures, big successes. But Obama nevertheless appears determined to undermine them with sharp cuts in payments and sweeping new regulations.

Started back in 1997 — and initially called Medicare+Choice — the Medicare Advantage program pays private insurers a set amount per enrollee to provide comprehensive benefits and anything else they can afford to offer.

The idea was that private insurers could better co-ordinate care and manage health costs than the old fee-for-service Medicare, and so provide more comprehensive benefits.

While enrollment in these private plans was flat for the first several years, it has skyrocketed since 2005, to the point where almost one in three seniors are covered by a private health plan. And, contrary to Obama's claim, these seniors tend to get better quality health care than those in traditional Medicare.

Critics, however, point to studies showing that the government pays Medicare Advantage more per enrollee than it would cost if these seniors had enrolled in the old Medicare program.

Obama tried to remedy this by cutting payments by a total $200 billion over the next decade to help pay for ObamaCare (while providing "bonus" payments to plans that score high on a quality rating). An official analysis from Medicare's actuary concluded, however, that such cuts would drive millions seniors out of their Advantage plans and back into the government-run program.

Recognizing political risks of these payment cuts, the administration put them off until after the presidential elections, shoveling $8 billion into a bogus "demonstration project" that offset almost all the scheduled Medicare Advantage cuts in 2012.

Question: What are your thoughts about President Obama's cuts to the Medicare Advantage Program?


Source: Investor's Business Daily
Additional Updates:

  • Combined Insurance Company - Hot new Plan "G" Release
    Approved: Illinois, Kentucky, Pennsylvania & Tennessee
    Filed: Alabama, Indiana, Mississippi, South Carolina & Texas

Senators Concerned About Medicare Advantage Cuts

  
  
  

Medicare Supplements Some Democrats have now joined their Republican counterparts in asking the Obama administration to moderate scheduled Medicare Advantage payment cuts for 2015.

In a letter to Centers for Medicare & Medicaid Services Administrator Marilyn Tavenner, a bipartisan coalition of 40 senators urged the administration “to maintain payment levels that will allow [Medicare Advantage] beneficiaries to be protected from disruptive changes in 2015.” Cuts to Medicare Advantage plans are part of the $716 billion in Medicare spending reductions the health law calls for over the next decade.

Senate Democrats who signed the letter include Charles Schumer of New York, a member of the Senate Democratic leadership team, as well as several who are facing tough re-election campaigns, including Kay Hagan of North Carolina, Mark Pryor of Arkansas and Mary Landrieu of Louisiana.

As early as this week, CMS is expected to release preliminary Medicare Advantage payment rates for 2015 that insurers have estimated could reduce payments by as much as 6 percent to 7 percent next year. Insurers and other Medicare Advantage proponents say cuts of that magnitude could cause premium increases and benefit reductions.

“Seniors cannot afford another round of rate cuts to their Medicare Advantage coverage,” said AHIP President and CEO Karen Ignagni in a release. “CMS should protect seniors in the program by maintaining current payment levels next year.” Final Medicare Advantage payment rates for 2015 are scheduled to be released in April.

According to the senators’ letter, about 15 million seniors and individuals with disabilities — accounting for 28 percent of Medicare beneficiaries — are enrolled in Medicare Advantage plans. The policies tend to offer extra benefits, such as hearing aids or gym memberships, that are not available in traditional Medicare.

For years, Medicare Advantage plans were paid more per beneficiary than what Medicare paid for beneficiaries enrolled in traditional fee-for-service. The health law aims to equalize that spending over time, so the government pays the same amount whether a beneficiary enrolls in Medicare Advantage or traditional Medicare.

The Senate letter isn’t the first of its kind from lawmakers. In a Feb. 13 letter to President Barack Obama, House GOP leaders and key Republican committee chairs expressed their concern over the impending Medicare Advantage cuts. The cuts, along with additional CMS regulations, “will force millions of Americans to face higher health care costs or lose access to their doctor, health plan, lifesaving drugs, and the benefits they’ve come to rely on.”

However, federal officials’ choices may be limited. In a blog post, Edwin Park of the Center on Budget and Policy Priorities, a left-leaning think tank, writes that the insurers’ campaign against the payment cuts suggests that the administration will make trims beyond those included in the health law. “In reality, as was the case last year, the [a]dministration likely won’t propose any new payment reductions,” Park wrote. “It will likely just announce how it will apply existing law, reflecting the combined impact on Medicare Advantage payment rates of health reform and the continued slowdown in growth in Medicare Costs.”

Source: Kaiser Health News

 

Additional Updates:
 

Hospitalized under observation status, a costly secret

  
  
  
Medicare Supplements More and more seniors are finding out that Medicare will not cover their stay at the hospital because they were not officially admitted. Instead, they received ‘observation’ care, which is an outpatient service not covered under Medicare.

Medicare covers the first 100 days of care for skilled nursing, only for patients who were formally admitted into a hospital for three consecutive days.

This is a growing trend that is very costly for senior Medicare recipients. Recent federal data shows a sharp jump in patients receiving ‘observation’ care. In 2011, 1.4 million patients were being labeled under ‘observation,’ compared to the 920,000 in 2006. The trend is apparent with patients who have longer hospital stays lasting more than 48 hours. Observation stays rose from 27,600 in 2006 to 112,000 in 2011.

The increased problem appears to be due to a Medicare effort to control costs through a program that audits hospitals for possible overpayments. Once the program identifies improper errors, the hospital must comply with Medicare and must refund all the Medicare payments it received. This has made hospitals more cautious about the admission process and what they think could be challenged; as well, it allows a hospital to receive a lower reimbursement for observation status patients.

Since 2011, a long time legal battle has prompted a class action lawsuit from the non-profit Center for Medicare Advocacy (Bagnall v. Sebelius), to force the government to change its policy. It has also encouraged other advocacy groups, healthcare providers, and lawmakers the need to change the law.

Momentum to change the law is also (apparent) in Congress, as Senator Sherrod Brown (D-Ohio), is proposing as part of hospital admission process, a legislation that would force Medicare to count all overnight hospital stays; the House of Representatives a similar legislation.

By April Medicare is set to apply a new rule that would require doctors to admit people as patients they expect to stay more than two midnights, and to classify anyone else under observation status. However, there is great resistance to delay the new law from a large coalition of healthcare providers and advocacy groups whom argue that it will be very difficult to comply with the new rule. They argue it would arbitrarily reward patients who happen to arrive at the hospital at certain times of day and that it does not alter the three-day rule.

Traditional Medicare recipients can be affected by the observation status and are the most vulnerable to the rule. Unlike (patients) that uses Medicare Advantage programs, they are subject to their insurance provider’s plans.

Medicare Advantage plans provide comprehensive medical coverage, higher-quality care, better services, and additional benefits, reports The Coalition for Medicare Choices, a national grassroots organization who sole purpose is to protect and improve Medicare Advantage.

Traditional Medicaid program covers 100 percent of the first 20 days of a skilled nursing facility, only when the patient meets Medicare's three-day formal admission hospital rule. Patients are responsible for $152 daily co-pays for the remaining 80 days. Otherwise, patients pay full out-of-pocket cost for the skilled nursing facility if they left the hospital under observation status.

In New York, the daily cost for a skilled private room averaged $230 in 2013, with cost going up to $344 in New York state, according to a survey conducted by Genworth Financial. The survey data illustrates that an observation status patient would pay $34,440 for a 100-day stay in a skilled facility compared to the $12,160 out-of-pocket cost a formally admitted patient; that is $22,280 more.

Hospitals are not required by law to notify patients of their hospital status in many states. The only way seniors may be able to protect themselves from observation status is to constantly ask or have a family member or legal guardian, request to be formally admitted into a hospital.

Medicare Supplements





Please give us your feedback!
Question: Should the government do more to protect seniors by passing a law that makes hospital disclose the patient’s admission status?

Source: Reuters & NBC Nightly News
Additional Updates:

  • Forethought Insurance
    January 31, 2014 Forethought® FreedomSM to be discontinue Learn More

A Medigap premium tax could save billions

  
  
  
Medicare Supplements Medigap insurance, which reduces consumer out-of-pocket expense, can affect claims at the heart of any plan; says two economists who studied the Medicare Supplement market and analyzed real-world scenarios. The economists believe that simply taxing the Medicare Supplement products could lead to big savings.

Economists Marika Cabral of the University of Texas and Neale Mahoney of the University of Chicago agree that Madigap products encourage extra Medicare spending.

Marika and Neale analyzed Medicare program spending data in hospital service areas across state borders and have also analyzed different Medicare premiums on each side of the border.

The data underwent many variables that could skew comparisons of Medicare Supplement appeals towards the needier elderly, who would also spend heavily even if they only had traditional Medicare.

The findings showed an increase of 22 percent in Medicare spending or about $1400 per year, a 24% increase in hospitalization, with a 34% increase in physician service fee.

The economist estimate a simple 15% Med Supp premium tax could generate $13 billion per year in spending cuts and tax revenue, and that a "Pigouvian tax,” could generate $32 billion in yearly savings.

The research did not focus on the Medigaps effects to patients' health, care, or product satisfaction; however, they found no noticeable effect on the likelihood that patients would get genuinely urgent procedures with or without the use of Medigap.

The economists make their research available on a copyrighted working paper on the National Bureau of Economic Research website.




Please give us your feedback!
Question: Do you think a Medigap premium tax will save the government money in the long run and keep the quality and the satisfaction of care seniors receive high?

Source: LifeHealthPro
Additional Updates:

Plans to disclose physician reimbursement fee may be underway

  
  
  
Medicare Supplements A new policy that informs the public how much money Medicare pays individual doctors may be underway and could violate physicians' privacy rights if poorly handled, warns the American Medical Association.

The Department of Health and Human Services (HHS) has announced that it will start responding to Freedom of Information Act requests for physician-payment data. Government officials will be using a ‘balancing test’ to determine who gets access to the information, and not guaranteeing the data to all filed request. This has prompted groups to say the administration needs to do much more in making payment data broadly accessible and transparent.

Under the FOIA's privacy exemption, some of the doctor’s information may be kept from public view if the damage to physician privacy is deemed greater than the public interest. Disclosure of the doctor’s data will exclude patients information; however, the information released will depend on the outcome of the “balancing test”, which varies by circumstance, analysis, facts, and per case. In all cases, the HHS says they “are committed to protecting the privacy of Medicare beneficiaries.”

In addition, the Center for Medicare & Medicaid will begin “aggregating” data sets about Medicare physician services, 60 days after the new policy appears in the Federal Register.

Disclosure of doctor payment data “from government healthcare programs must be balanced against the confidentiality and personal privacy interests of physicians and patients who may be unfairly impacted by disclosures” says Dr. Ardis Dee Hoven, president of the AMA, who has long opposed the release of data.

Over the past 3 decades, Medicare physician-payment data has been highly sought by media groups, government watchdogs and private organizations. They argue that the disclosure of information informs consumers of a doctor’s competence, performance, and highlights any possible abuse or fraud. The release of information should only be done in the efforts of “improving the quality of healthcare services and with appropriate safeguards,” Hoven said.

Critics against disclosure argue that the release of information would reveal proprietary details the general public does not need to know, and that inaccurate data presentation would damage a doctor’s reputation.

In spite of responding to Freedom of Information Act requests for physician-payment data, the government is not planning to put the entire Medicare physician-payment data online in a searchable format. It will require individuals seeking data to submit specific request under the FOIA’s. Any information that gets released will be filtered and judged by its worthiness, and will take physicians privacy concerns into consideration.

On May 2013 a 1979 federal injunction ruling, that barred the release of Medicare payment data and identified doctor’s specifics, was dissolved by U.S. District Judge Marcia Morales Howard in Jacksonville, Fla., ruling on the grounds that physicians' privacy concerns no longer outweighed the public interest.

Following the ruling, CMS followed suit to and decided to release physician-payment data, citing disclosure under the Freedom of Information Act. Disclosure of the data will be determined on the outcome of the “balancing test,” as a result every case will be treated as an individual basis (FR Doc. 2014-00808).




Please give us your feedback!
Question: Will disclosing physician fees help stop Medicare fraud and save money in the long run or will it have an adverse effect and persuade more physicians to stop accepting new Medicare patients?

Source: ModernHealthCare
Additional Updates:

  • Gerber Life
    February 2014 Med Supp Rate Adjustments for NE. Learn More

    - Med Supp Outline Release. Learn More
  • Sentinel Life
    Med Supp Outline Release Plans Sold for Effective Dates on or After June 1, 2010 for IL. Learn More

    - Med Supp Outline Release Plans Sold for  Effective Dates on or After June 1, 2010 for  PA. Learn More

CMS - Potentially‎ overhauling Medicare broker compensation

  
  
  
Medicare Supplements Big plans to change the way how the private Medicare sector pays brokers and agents are underway and set to appear in the Federal Register on Friday.

The Centers for Medicare & Medicaid Services (CMS), an arm of the U.S. Department of Health and Human Services (HHS), has included the compensation proposals changes in a batch of regulations that deals with the governing rules of the Medicare wellness program, its incentives and the provisions meant to prevent and attack fraud.

The addendum targets current compensation practices of brokers and agents who sell Medicare Advantage plans -- commercial, CMS-subsidized plans that replace traditional Medicare coverage -- and Medicare Part D prescription drug plans.

A yearly “fair market value” limit for producer compensation is what CMS wants, states the proposed regulations.

In 2014, $400 per year may be considered the fair market value. A plan possibly paying a first year commission that was any amount less than or equal to the fair market value limit, officials say.

Commission increase could reach up to 35 percent of the fair market value limit in the following calendar year and the subsequent years. For instance, if in 2014, a producer sold a plan and collected in commission equal to $400, or collected 100% of fair market value, and if the fair market value for 2015 rose to $500, the 2015 year commission would be $175 or 35% of $500 and not 35% of $400 fair market value of previous year, officials say.

Many current plans pay 50% in renewal commission for the first-year commission during policy years two through seven, followed by a 25% of the first-year commission in the later years

CMS goal is to simplify the commission calculations and level out the playing field. The way to do this is by setting all renewal commission to 35% of the fair market value limit, officials say.

To further even out the field, official want to cap out referrals fees at $100 for producers; which, CMS recommended a $100 cap in a memo in 2011.

This recommendation is due to the different ways carriers handle referrals, officials say.




Please give us your feedback!
Question: Will overhauling the Medicare broker compensation even out the playing field, or will it hurt the industry and discourage top producers from reaching or exceeding their goals?

Source: LifeHealthPro
Additional Updates:

What's your GOAL for 2014?

  
  
  
Medicare Supplements Happy New Years from Precision Senior Marketing; It is that time of year to start off with a clean slate.

If you have not already done so, take the time to reflect on 2013 and take note of the hurdles and successes that made the business year memorable.

Make this the perfect time set new goals. Look at the BIG picture, be considerate and write down what is important to you, what you want to achieve, and the timeframe you want to achieve the goal(s).

Most importantly, if you want to succeed, focus and follow through.



Below are Five Golden Rules to Set Yourself Up for Success:

1. Set Goals as Motivators

Motivation is key to the success of reaching your goals. The goals you set should be important and in high value to you. If you set goals that are irrelevant to or of little interest, chances are there will be little or no devotion to achieving your goals.

To maximize your success for goal setting, make sure you write the reason why it's valuable and important to you.

2. Set SMART Goals

"SMART goals" are powerful goals; these goals designed to be Specific, Measurable, Attainable, Relevant, and Time Bound.

Specific Goals
Make your goals clear and well defined. Avoid any vague or generalized goal setting that provide insufficient direction. Your goals should pave the way and make it as easy from point A to point B.

Measurable Goals
Define precise amounts and descriptive measures. This includes, cost, quantity, dates, and so on. This is very helpful in keeping measure of your goals and degree of success.

Attainable Goals
Goals should fall within the objective and be attainable within the organization members and influence. Resist setting goals to impossible, this may hinder confidence, or too easy to attain.

Remember, set challenging yet attainable goals that gives a sense of accomplishment and satisfaction, allowing you to “raise the bar” within the organization.

Relevant Goals
Make sure these goals are in-line with your life and career objectives. By keeping them aligned you'll be more focus to get ahead and do the things that you want.

Time-Bound Goals
Time driven goals should have a specific completion date or specific action date to go to the next phase of the goal. Incorporate dates, milestones and timeframes that are relevant to the ultimate goal. By following through, the overall achievement will come much sooner.


3. Write down your Goals.

Physically write down your goals. The simple act of writing makes your goals more real and it subconsciously makes it a high priority job that needs attention and tending. When writing use words that express, empowerment, desire, willingness and gives you no room for slacking or derailing from your ultimate goals. For example, “I will increase and convert my leads to sales by 40% this year,” rather then, “I would like to” or “I may.”

Once you have the goals written, post them in a visible place where you can be constantly reminded of what is intended to do. Keep the visual on a wall, desk, a screensaver, anywhere it can be a constant reminder.

4. Create an Action Plan.

Actions plans are your smaller steps or smaller goals the lead to the ultimate goal. Think of them as the steps of a ladder. By writing down a series of steps and crossing those out as you reach your action goals; you’ll get a better visual progression of your hard work and efforts.

5. Follow through!
It can’t be over emphasized, follow through the entire course. Set reminders and check periodically to see where you stand in relation to your goals. Review your goals and make the necessary adjustments to stay on course. Don’t get stressed burning your energy on the outcome. Instead focus on the smaller steps (action plan) that will get you to all the way to your final goal.

Remember, without goals, there is no plan…there is no focus...there is no purpose to succeed.



Please give us your feedback!
Question:Do you feel the SMART Goal steps may help your organization layout a better goal plan for 2014, if so, let us know if the full list or partial section will be utilize?

Source: Mindtools
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