GAO: MA Plans Might Have Piled Extra Costs on Healthy Beneficiaries
A recent Government Accountability Office report found that Medicare Advantage plans might have drawn healthy beneficiaries into low-premium plans and then subjected them to unexpectedly high out-of-pocket costs, The Hill reports.
The report, which was requested by Democratic leaders of the House Energy and Commerce and Ways and Means committees, highlights a practice that Democrats say the new health reform law will prevent.
The report found that beneficiaries enrolled in low-premium MA plans in 2008 paid about $100 more for a typical inpatient hospital stay than those in plans for beneficiaries in poorer health and about $150 more for a typical inpatient mental stay.
The report also found that healthy beneficiaries paid about $500 more for a regular stay in a skilled nursing facility, such as a nursing home, and about $300 more for one year of renal dialysis.
Democrats Aim To Dissuade Critics
Democrats are using the report to dispel criticism from seniors who worry about the new health reform law's effect on Medicare. MA beneficiaries -- which make up 24%, or 11 million, of all Medicare enrollees -- have been among the most vocal critics of health reform, according to The Hill.
House Ways and Means Health Subcommittee Chair Pete Stark (D-Calif.) said, "This report shows that left to their own devices, insurance companies will design plans that benefit their profit margins above all else," adding, "As CMS implements MA reforms, they need to hold insurance companies accountable so they can't stick seniors with the bill for their profit maximizing schemes."
Insurance Industry Response
Insurers have countered that the report also found that MA plans have saved seniors money compared with traditional Medicare plans.
Robert Zirkelbach, a spokesperson for America's Health Insurance Plans, said, "Recent reports have found that seniors in Medicare Advantage spend fewer days in a hospital, are subject to fewer hospital re-admissions and are less likely to have 'potentially avoidable' admissions, for common conditions ranging from uncontrolled diabetes to dehydration, compared to fee-for-service Medicare."
Zirkelbach noted that the report found that healthy beneficiaries paid $823 in cost-sharing under MA plans for an average 10-day inpatient hospital stay, compared with $1,068 for traditional Medicare beneficiaries. He added that regular Medicare plans also feature higher costs for primary care visits (Pecquet, The Hill, 6/1).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.