Medicare and Reform

[MrMack]

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News and Information affecting Senior Market Insurance Agents.




Detailed Information on 2010 Medigap Modernization

June 22, 2009 by Craig

For those who like to "read the fine print", here is the NAIC/CMS model legislation from the Federal Register.
Thanks to Joe in Philly for the source!

2010 Medigap Modernization (the file is large)



Posted in Medicare Supplement, Medigap Modernization

 

[AJAX]

Re: Medpac june 2009

You can Google "MedPac June 2009" to verify the following


To summarize the following report, and the quoted text below. MedPac found that people with Medigap policies used Medicare the most, and they were the healthiest in the long run.

What does MedPac recommend?

Chapter 6 page 159:
"Help improve Medicare's financial sustainability
Changes to the FFS benefit have become more urgent in view of the Medicare program's serious financial challenges. Raising cost-sharing requirements could rein in spending for health services that are more prone to overuse, particularly if accompanied by limits on the portion of Medicare's cost sharing that secondary coverage could fill in. Increasing the share of Medicare's costs borne by beneficiaries through premiums would also reduce the federal government's share of Medicare spending. Because indiscriminate increases could impose financial barriers to essential care or cause hardship for some Medicare beneficiaries, policy changes would need to balance these concerns with the goal of improving Medicare's financial sustainability.
One approach is to levy an excise tax on medigap policies, with the revenue dedicated to offsetting Medicare program costs. This tax could reduce incentives for Medicare beneficiaries to purchase medigap policies,

encourage them to purchase less expensive plans, and help compensate the Medicare program for the added costs that stem from supplemental coverage. CBO estimates that a 5 percent tax on each medigap policy premium would increase federal revenues and decrease mandatory spending by $12.1 billion between 2009 and 2018 (CBO 2008). Drawbacks to this approach are that it would treat medigap policies differently from employer-sponsored retiree plans, which are also associated with higher Medicare spending, and could boost enrollment in Medicare Advantage, which the Commission and others have found currently requires more program spending per beneficiary than FFS Medicare (MedPAC 2009).
Under another approach, policymakers could redefine medigap policies so that they no longer completely filled in FFS cost-sharing requirements. For example, CBO estimates that if medigap policies did not pay any of the first $525 of a beneficiary's FFS cost sharing, and if coverage of the next $4,725 in Medicare cost sharing were limited to 50 percent, those measures would lead to $41 billion in federal mandatory savings between 2010 and 2019 (CBO 2008). Savings could be even larger by combining changes to medigap policies with other FFS benefit design changes. CBO estimated that if medigap policies no longer covered any of a new $525 combined deductible and covered only 50 percent of the new uniform coinsurance on services up to a Medicare OOP cap set at $5,250, it could reduce federal mandatory spending by $73 billion between 2010 and 2019 (CBO 2008).
Addressing the goal of Medicare's financial sustainability may require setting priorities among health coverage needs. That is, society may need to "differentiate between health care that supports the most essential aspects of human functioning and that which serves to enhance an individual's quality of life" (Ginsburg 2007)."