Health Care Reform
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May 4, 2009 Posted by Adam Swope
What a busy schedule our congressmen have had in Washington during the first 100 days of the Obama Administration! Now that the economic crisis seems to be leveling off and the 2010 budget will soon be resolved, our legislators’ attention is beginning to shift to healthcare reform, education and global warming.
Healthcare reform is one of the issues that all retirees should keep their eyes on. The insurance and pharmaceutical industries played a major role in the Healthcare summit at the White House last month and have been active in lobbying for their interests. One of President Obama's plans was to create a national healthcare exchange that would provide coverage for the uninsured and others who would like to enroll in the resulting system. The question now is whether to insure the uninsured with public (government-run) insurance, private insurance or a combination of both.
Many of our retirees are covered by public plans- Medicare, Medicaid, Tricare (veteran's insurance) and other public plans. Not only are these plans popular with beneficiaries and vital to their well-being, but they are administered with a low overhead of about 2%. They are defined benefit plans that tell beneficiaries what costs will be reimbursed and what costs they are responsible for. Medicare Advantage plans are private insurance companies that have contracted to become the Medicare carriers for enrollees and each one offers a menu of plans with varying benefits and premiums, not necessarily in agreement with Medicare payments. Since their inception in 2004, these plans have received reimbursement rates as high as 14% to 19% more than required to finance the Medicare program. These rates will be reduced by 5% next year and eventually eliminated, saving about $177 billion over 10 years. Recently some of the MA plans reported profits as high as 30% and we are all aware of the CEO's salaries. At the same time, doctor's offices are overwhelmed with the many health care programs they must deal with in billing, processing claims and resolving mistakes. It was recently reported that doctors in the U.S. waste about $95 billion a year fighting with insurance companies and filling out their paperwork. All of this waste could be eliminated and the extra money put back into the healthcare system to better serve all Americans. Sounds like another case of keep it simple, stupid!
May is Older American's month. I encourage all of you to pick up your phone and tell Senator Specter, Senator Casey and your local Congressman to preserve Social Security and Medicare and work to insure that Americans have good, quality healthcare for all. Remind them you live on a fixed income.
Have a happy spring!
Jean Friday
President, Pennsylvania Alliance for Retired Americans