Medicare mess

When President Barack Obama began pursuing health care reform, he promised citizens that reform would reduce the high cost of health care.

For people in Medicare Advantage plans, who may face either rising premiums or a decrease in services, it may seem that the president isn’t keeping his word.

But Medicare Advantage plans now provide services to recipients that are being paid for by Medicare enrollees who aren’t benefiting. That’s not fair, and Congress was right to correct this wrong in the new reform law.

Some history: The Medicare Advantage program was created to give senior citizens the option to get coverage by private insurers, rather than Medicare. The idea was that private insurers could provide the same care better and cheaper, and private insurers were originally paid 5 percent less than Medicare.

But over time, the Medicare payment policy shifted from one that produced savings to one that offered seniors extra benefits, like paying for eye glasses and health club memberships. Insurers are now being paid on average 14 percent more than what it costs Medicare to administer benefits.

A typical couple in Medicare now pays on average $90 more per year to subsidize private insurance companies’ Medicare Advantage plans. So it makes sense for Congress to phase in reduced payments to private insurers. Insurers that demonstrate high quality service will get a five percent bonus.

With about 75,000 seniors in Monroe County enrolled in Medicare Advantage, insurers should do all they can to operate more efficiently to keep premiums stable and provide the same benefits.

Should changes come, Medicare Advantage enrollees may feel shortchanged, but they should remember that reform also will save them money on prescription drugs, by closing the so-called doughnut hole.

— The Democrat and Chronicle, Rochester, N.Y.