MedPAC Approves Plan To Limit Out-of-Pocket Costs for Beneficiaries

The Medicare Payment Advisory Commission on Thursday approved a proposal to limit out-of-pocket costs for Medicare beneficiaries, Modern Healthcare reports (Daly, Modern Healthcare, 4/5).

The proposal -- which is expected to be included in MedPAC's report to Congress in June -- urges HHS to establish a new fee-for-service design that would include: 

• A limit on out-of-pocket expenses; 
• A combined deductible for inpatient and outpatient services; and
• Copayments that vary by service and provider type.

According to CQ HealthBeat, the out-of-pocket expenses cap would be paid for by an additional charge on supplemental insurance plans (Adams, CQ HealthBeat, 4/5). Specifically, MedPAC recommended a fee on Medigap plans, although the commission did not specify the size of the fee. MedPAC members often criticize the supplemental plans for promoting health care overutilization by covering all out-of-pocket expenses, according to Modern Healthcare (Modern Healthcare, 4/5).

Overall, the panel said the value of the Medicare benefits package should not decline (Adams, CQ HealthBeat, 4/5). Michael Chernew, a commissioner and a professor at Harvard Medical School, said, "This whole effort is not motivated by a desire to achieve savings, but it's really motivated by a desire to have a benefit package that works for beneficiaries" (Modern Healthcare, 4/5).

MedPAC Concerned About Automatic Enrollment of Dual Eligibles in Managed Care

Meanwhile, the commissioners on Thursday expressed concern with a plan included in the federal health reform law to automatically enroll individuals who are eligible for both Medicare and Medicaid into managed care plans, according to CQ HealthBeat . MedPAC Chair Glenn Hackbarth said the plan could move such "dual eligibles" into a new care delivery model, regardless of whether that model meets their specific medical needs (Reichard, CQ HealthBeat, 4/5).