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View Diary: House broken: How the GOP legislative machine turned into a doomsday device (176 comments)

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  •  The 2003 Medicare modernization act (0+ / 0-)

    also created the Medicare Advantage programs as well as Part D of Medicare. The insurance companies were allowed to sell programs that offered more benefits than Medicare, but to do it they locked the beneficiaries into the Advantage program for a year. Medicare paid what it would have cost to operate and administer Part A (Hospitalization) and Part B (Physicians insurance) -- PLUS a 13% bonus to induce insurance companies to risk entering the new market. The drug benefit (Part D) was also wrapped into this.

    The idea of the bonus was that the ability of insurance companies to operate using free market principles in competitive markets would lower the total cost to less than the government paid to operate the programs.

    The insurance companies operate HMO's or PPO's through networks of preferred providers to save money. In other words, all the money supposedly saved is by changing how providers are paid and which ones they permit a beneficiary to go to. They do nothing to lower actual medical costs, they just game the market.

    The insurance companies have had the plans since 2006 and have never been able to match the low cost and flexibility of government operated Medicare, but they still get the bonuses and fight all effort to stop them. That's the big savings Obama promised. Stop paying insurance company administration cost and executive salaries and just let Medicare provide the services at a better cost. No more networks. No more PPO's. See any physician you want.

    The insurance companies also each have their own formulary of prescription drugs they allow payment for. That's the big question on Medicare Advantage. Will they pay for the medications the beneficiary needs? The beneficiary is then locked in for  year, and if the new drugs they need are not on the formulary, tough shit.

    But the insurance company can change the formulary overnight based on simply notifying the beneficiary. No warning, no protection.

    The US Supreme Court has by its actions and rhetoric has ceased to be legitimate. Whiskey Tango Foxtrot - over

    by Rick B on Mon Dec 31, 2012 at 01:57:17 PM PST

    [ Parent ]

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