The story so far:
1) Earlier this year, President Obama proposed eliminating Medicare Advantage, a program by which seniors can receive their healthcare through private plans, rather than directly through Medicare. Current stats show that approximately nine million are enrolled. On the 12 January 2009 edition of
This Week with George Stephanopolous, he said
"We’ve got to eliminate programs that don’t work, and I’ll give you an example in the health care area. We are spending a lot of money subsidizing the insurance companies around something called Medicare Advantage, a program that gives them subsidies to accept Medicare recipients but doesn’t necessarily make people on Medicare healthier. And if we eliminate that and other programs, we can potentially save $200 billion out of the health care system that we’re currently spending, and take that money and use it in ways that are actually going to make people healthier and improve quality."
Please remember what the President told the AMA on 15 June: "If you like your doctor, you will be able to keep your doctor, period. If you like your health care plan, you’ll be able to keep your health care plan."
2) Humana, a large insurer, sent out a letter to its Medicare Advantage participants stating, in part, that "millions of seniors and disabled individuals could lose many of the important benefits and services that make Medicare Advantage health plans so valuable."
3) Senator Max Baucus referred the matter to Health and Human Services, which then penned
a cease-and-desist letter to Humana. In the wake of this, the Humana story has been all over the news.
I tend to agree with the Wall Street Journal on this one when they represent Baucus's actions as
bullying.
[Baucus stated that] "The health-care reform bill we released last week strengthens Medicare and does not cut benefits covered under the Medicare program—and seniors need to know that." In fact, the Baucus draft legislation slashes $123 billion over the next decade from Medicare Advantage, which Democrats hate despite the fact that almost one-fourth of beneficiaries have chosen it over traditional fee-for-service Medicare. One reason seniors like it is because private insurers focus on quality and preventive care and try to manage benefits, as opposed to simply paying bills.
A new study from America's Health Insurance Plans, the industry trade group, finds that seniors on Advantage in California spent 30% fewer days in hospitals over fee-for-service patients, based on federal data. Democrats say that insurers are "overpaid," but the cuts—as Humana correctly noted—mean that seniors may lose this coverage.
In short, both Obama and Baucus have proposed either eliminating or slashing Medicare Advantage...and they're complaining when the insurance industry rightly warns their customers that their current plan may be on the chopping block?
A quick note on the "Maddow" point: I first heard of this kerfuffle while flipping past the Rachel Maddow show. It is my recollection that she introduced the topic by quoting from the Humana letter, but in a choppy way that disguised the fact that they were talking specifically about Medicare Advantage. While I have not been able to confirm this (I haven't been able to find a transcript of the program), it would not surprise me.
You can bash greedy insurers all you want; but it seems to me that you shouldn't give them too much grief for telling the truth.
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