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.
Summary of Medicare Provisions in the President’s Budget
Beneficiary Premiums, Deductibles And Cost-Sharing
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
Medicare Blog | Medicare News | Medicare Information
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| 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
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