Misunderstandings are rampant on health care reform and Medicare
Posted on 05 August 2010
By Mark Miller
Permanent URL of this article: http://retirementrevised.com/money/misunderstandings-are-rampant-on-health-care-reform-and-medicare
When it comes to health care reform, seniors are in the dark.
A new national poll reveals that many adults over age 65 are misinformed or confused about the impact of the new law on their Medicare benefits, physicians and the federal budget deficit. Harris Interactive conducted the poll of more than 600 adults for the National Council on Aging (NCOA), a non-profit service and advocacy group focused on seniors and aging.
I know from my own reader mail that seniors are worried–and in some cases, angry–about the Affordable Care Act. The new law contains a number of important improvements in Medicare coverage, but fact-free media coverage and political spin have stoked fear among seniors.
The NCOA poll confirms that the facts just aren’t getting out to Americans on Medicare. Among the remarkable findings:
Benefit cuts: The new law does not cut Medicare benefits, but only 22 percent know this. Meanwhile, 42 percent told NCOA’s pollsters they think benefits will be cut in the future. In fact, the law adds new preventive health visit coverage, gradually closes the gap in prescription drug coverage (the “doughnut hole”), boosts reimbursement rates to primary care physicians and improves long-term care coverage for seniors with disabilities who live at home.
On the doughnut hole, 42 percent were aware that the coverage gap will be closed over time–a number that could have been much higher considering the importance of this change in benefits.
The widely-held view that benefits are being cut probably stems from the oft-repeated warning from health care reform opponents that the law slashes Medicare. The only leg these critics have to stand on is the planned cuts in reimbursements to Medicare Advantage programs–the privatized managed care option offered to Medicare beneficiaries. But cuts in reimbursements are not the same as cuts in benefits.
Medicare Advantage plans currently are reimbursed by the federal government at 114 percent of regular Medicare rates — a payment scheme that was put in place to stimulate the Advantage market but amounts to no more than a big subsidy to insurance companies. The new law freezes Advantage payments at current levels through 2011, and then reduces them by $116 billion over a period of years, ultimately equalizing reimbursements with traditional Medicare. But 17 percent of respondents think the law will eliminate Advantage plans, with another 62 percent unsure of the law’s impact.
There’s also confusion among seniors who don’t seem to know whether they are enrolled in basic Medicare or Advantage plans.
“Many seniors don’t know if they are in Medicare Advantage or something else,” said Howard Bedlin, NCOA’s vice president for public policy and advocacy. “They may have a Medigap policy or a prescription drug plan from one of the providers that also offers Medicare Advantage. They get all these things in the mail from companies that may have nothing to do with their basic Medicare coverage, and sometimes the difference is just not that clear.”
That confusion turns up in NCOA data showing that 47 percent of poll respondents say they are in Advantage plans–a number that’s nearly double the actual national enrollment rates, according to research by the Henry J. Kaiser Family Foundation.
Physician rate cuts: Seniors worry–with justification–that their doctors will stop accepting Medicare due to insufficient reimbursement rates. Congress has been squabbling for years over a scheduled double-digit cut to doctors’ compensation; it’s an issue that the health care reform law didn’t address–which is unfortunate.
At the same time, the law doesn’t specifically call for any cuts in payments to doctors. But just 14 percent of poll respondents understood that. A full 45 percent stated that the law does cut physician reimbursement rates; and another 41 percent weren’t sure.
The federal deficit: The new law isn’t projected to increase the federal deficit–but only 14 percent of respondents knew that. In a similar vein, the law is expected to extend the solvency of the Medicare Trust Fund by almost a decade, but only 24 percent of respondents knew this.
NCOA only surveyed Medicare-eligible individuals over age 65, but the new law also contains important benefits for older Americans below that age who are ineligible for group insurance plans due to joblessness or other factors. Although insurance issues affect Americans of all ages, the problems are acute for people over 50, who tend to have more pre-existing conditions than younger people do, and use more health care.
Starting in 2014, insurance companies won’t be able to refuse applicants with pre-existing conditions, and the new law also creates new insurance options for people without group coverage. This summer, new high-risk insurance pools are being launched in many states in partnership with the federal government that cap annual out-of-pocket costs at $5,950 for individuals and $11,900 for families.
The high-risk pool will serve as a bridge to longer-term solutions. These include private insurance exchanges that will operate starting in 2014, as well as expanded Medicaid for low-income households.
NCOA is launching an education campaign, Straight Talk for Seniors on Health Reform, aimed at helping seniors get the facts they need about health reform and changes to Medicare.
August 5th, 2010 at 5:45 pm
I have been on Humana’s Medicare Advantage plan for the last three years, when I became eligible for Medicare due to total disability. The monthly premium, has more than doubled within the last three years, from $45 a month to $95 a month this year. This is above the monthly amount taken from Social Security for Medicare coverage. There are very few supplemental plans for the disabled, and Humana is ending up with windfall profits. Any decrease in the governments payment to Advantage plans will surely be reflected in even higher monthly premiuns.
August 5th, 2010 at 9:19 pm
For another view on this that I think is closer to what the new law will really do, read the following from the Wall Street Journal: http://online.wsj.com/article/SB10001424052748704026204575266472609370944.html?mod=WSJ_hp_mostpop_read
August 6th, 2010 at 7:41 am
Jim: Shocking that the WSJ’s opinion page doesn’t like the health reform bill!
Anyway, the WSJ’s big worry seems to be that there will be government rules governing what counts as coverage. That’s no different than the way Medicare operates today–the program accounts for roughly half the health care economy and gets very high satisfaction marks from patients. It’s also no different than the rules private insurance companies write into their policies. The story also glosses over the fact that we needed legislation to make sure private carriers actually spend the majority of premium dollars on health care, rather than marketing expenses and salaries for CEOs (those ironically named “medical los ratios”). See: http://retirementrevised.com/video/understanding-health-reforms-real-medicare-reductions.
August 7th, 2010 at 8:06 am
As a nurse married to a primary-care physician, I would like to say how much I appreciate seeing someone write about the positive aspects of health care reform. Our country has the most expensive health care in the world right now, and we are not close to having the healthiest nation. We are not getting what we pay for, and health care reform is a step to correct that.
August 11th, 2010 at 8:26 am
Positive spins on Health Care Reform reminds me when folks look at a field of weeds and someone spots one daisy and says isn’t this field beautiful. Health Care Reform is a scam to get everyone on one program run by the government.
August 11th, 2010 at 9:10 am
My 83 yr old mom has experienced getting a handout at church telling her how to vote in the recent Missouri question on whether to participate in the health Insurance pool with the Federal Gov. They said that if MO participates she will no longer be able to have her AARP tie-in insurance! This misinformation is clearly how those against the new Federal health care are obtaining votes against it.
August 11th, 2010 at 9:30 am
You need to tell the truth, the WHOLE truth and you are not doing that, just spouting propoganda from the Administration. Talk about doctors not accepting Medicare, heck that’ll be a minor worry compared to the droves of doctors who are quitting due to the “socialized medicine” approach. Let alone the ones that aren’t doctors yet and don’t want to be anymore because the monetary incentives are gone. Talk about the “lawbreakers” that’ll now be able to get subsidized healthcare. Talk about bankrupting the country, despite having to pay higher taxes. Please tell the truth, the whole truth and leave the propoganda at the door. Thanks.
August 11th, 2010 at 4:59 pm
Frank and the other fear mongers are the reason so many seniors are misinformed about the FACTS of health care reform. They keep spouting lies about “droves of doctors quitting”…where are the numbers on that? And the ones who don’t want to be doctors in the future…again, where is this coming from? By the way, I am a physician and I am very happy that reform has finally begun. There is much more to do, but at least we’ve started.
August 11th, 2010 at 10:30 pm
When I heard the words you have stage 3 cancer I thought that it was the worst day of my life. My insurance company paid for my surgery and months of treatment. Then I turned 65 and went on Medicare. Even though I had a great insurance policy Medicare rules applied. My treatment had to be limited. Then because Medicare didn’t pay the doctor enough my cancer doctor had to drop me. So don’t tell me how great Medicare is having had cancer is bad but living with Medicare is bad. I worked for 41 years and paid Medicare taxes so don’t tell me it is a handout.
September 2nd, 2010 at 10:31 am
Question: A friend has Medicare Part A, but did not take Part B. Now 14 yrs later has had second thoughts. He would now like to enroll in Medicare Part B, if he doesn’t have to pay a penalty. Will there be an opportunity offered by Medicare to enroll in Part B(without a penalty)in the future?
September 6th, 2010 at 5:17 pm
I agree with Frank. When are you going to tell the truth instead of spreading propaganda. I don’t understand what is in it for you. Hospitals in Colorado are dropping medicare and medicaid for low payments. I have to drive 100 miles to find a doctor who will except it and have what is supposed to be one of the greatest hospitals in western colorado 2 blocks away. Obamacare has already made things worse in my neighborhood and they are only going to get even worse.
September 7th, 2010 at 9:52 pm
Doctors in our part of the country are no longer accepting Medicare patients. They say Obamacare is prohibitive where Medicare patients are concerned. We all got an increased in what we have to pay for Medicare this year but no COLA! Looks like we were stiffed at both ends.