Kennedy To Introduce Medicare Bill Trimming Benefits to Insurers
Sen. Edward Kennedy (D-Mass.) and several other Senate Democrats on Wednesday will introduce a bill designed to eliminate some of the financial incentives for private insurers included in the new Medicare law, CongressDaily reports. According to a bill summary, the legislation aims to address the idea that additional funding earmarked for private insurers participating in Medicare is a "major reason" that the program's hospital trust fund is expected to be insolvent by 2019, CongressDaily reports. The earlier insolvency date and its causes were noted in the Medicare trustees' annual report issued last month. According to CongressDaily, the bill would:
- Not provide extra payments to plans that enroll "healthier-than-average" beneficiaries;
- Limit payments to insurers to 100% of the Medicare fee-for-service cost per beneficiary, instead of the average 109% called for under the new law;
- Repeal the $12 billion "stabilization" fund that would increase payments to insurers to encourage them to participate in Medicare; and
- Repeal the provision calling for a pilot program under which traditional, fee-for-service Medicare would begin directly competing with private plans in certain regions in 2010.
In related news, Leonard Schaeffer, chair of WellPoint, one of the largest health insurers in the nation, on Tuesday said that he has not decided whether the company will participate in Medicare. After delivering a speech at the American Enterprise Institute, Schaeffer said, "We have to see the regulations." According to CongressDaily, Shaeffer is considered a bellwether for other insurance company executives' participation in the new Medicare program. In 1997, Schaeffer decided that WellPoint would not participate in Medicare+Choice. He said that program "sounded good, but when we saw the regs, we went the other way." WellPoint will offer a Medicare-endorsed prescription drug discount card program, CongressDaily reports (Rovner, CongressDaily, 4/7).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.