Republican Lawmakers Join Push for Additional Medicare Advantage Plan Marketing Regulations
House Ways and Means Committee ranking member Jim McCrery (R-La.) and Health Subcommittee ranking member Dave Camp (R-Mich.) have begun to collect signatures from committee Republicans for a letter to CMS to request increased regulations on marketing of private Medicare Advantage plans, CongressDaily reports. According to CongressDaily, the letter, which "comes on the heels of reports" of improper marketing of MA plans, "completes the square of agreement" among House Ways and Means Committee and Senate Finance Committee leaders about the need for increased regulations.The letter includes some of the same requests made last week to the Senate Finance Committee by America's Health Insurance Plans, such as a prohibition on the use of cold calls to market MA plans and offers of prizes or other incentives for beneficiaries who enroll. In addition, the letter asked CMS to consider regulations that would allow Medicare beneficiaries to decide to disenroll from MA plans within 10 days of enrollment. The letter also asked CMS to consider the establishment of a public database that contains information about MA plans and sales agents who agency officials have sanctioned for improper marketing practices.
According to Republican aides, the letter seeks to determine whether legislative action is needed to address improper marketing of MA plans. Most Senate Finance Committee members believe that legislative action is needed, CongressDaily reports. House and Senate lawmakers likely will include increased regulations on marketing of MA plans in broader Medicare legislation expected in June (Johnson, CongressDaily, 3/11).
'Financial Neutrality' Proposal Questioned
In related news, Medicare Payment Advisory Commission Chair Glenn Hackbarth on Monday said that a proposal by former CMS Administrator Robert Berenson to implement a new system for payments to MA plans based on how plan costs vary geographically does not go far enough. In an article published last week in Health Affairs, Berenson described the new system as an alternative to MedPAC's recommendation for financial neutrality.
According to Hackbarth, Berenson seeks to "better match Medicare payments to plan costs, which is a legitimate goal." He added, "An alternative goal -- and this would be mine personally -- is to get the best possible deal for the Medicare program, including the beneficiaries and taxpayers who pay its bills." Hackbarth said that he is "all in favor of using private plans to lower costs and improve quality" and that "there are markets where they have demonstrated that potential." He added that MA plans offer alternatives for beneficiaries "even in markets where private plan costs are higher than Medicare's, provided the beneficiaries is willing to pay the added costs."
However, Hackbarth said, "I would ask the question, 'Why pay more than it costs traditional Medicare to deliver services given Medicare's long-term costs problems?'" He said, "Let's not throw away these advantages of traditional Medicare," adding, "If they can do it for less, by golly let's encourage them," but "let's not break up traditional Medicare, undermine its foundations, for private plans that cost more without improving quality" (Reichard, CQ HealthBeat, 3/10).
Editorial
A report on MA plans released in February by the Government Accountability Office has "provided yet more evidence these plans are a bad deal" because they cost "taxpayers more per beneficiary" for some services than traditional Medicare and "pad the profits of insurance companies," a Des Moines Register editorial states. According to the editorial, the "additional payment," or "rebate," paid to MA plans "isn't necessarily dedicated to benefits for enrollees," as 87% is spent on medical expenses and the "remainder goes to nonmedical expenses, including administration, marketing, sales and profits."
The editorial states, "The solution, of course, is for Congress to fix what it did wrong in 2003 when it expanded opportunities to the private sector in Medicare." The editorial concludes, "Lawmakers should cut subsidies to the insurance companies" (Des Moines Register, 3/10).
