Wall Street Journal Letters To The Editor Address Recent Opinion Piece On Medicare Bill
Main Category: Medicare / Medicaid / SCHIPArticle Date: 04 Jul 2008 - 9:00 PDT
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The Wall Street Journal on Thursday published two letters to the editor in response to an opinion piece about a bill (HR 6331) approved last month by the House that would delay a scheduled 10.6% reduction in Medicare physician reimbursements and reduce funds for Medicare Advantage. The opinion piece, written by Scott Gottlieb, a former CMS official and an American Enterprise Institute fellow, appeared on June 24. Summaries of the letters appear below.
- Nancy Nielsen: Traditional Medicare "withers on the vine at the expense of access to care for the 80% of seniors and disabled who rely on the program," and, despite "naysayers' claims," the bill would not "cut Medicare Advantage benefits to seniors," Nielsen, president of the American Medical Association, writes in a Journal letter to the editor. The legislation would "simply make common sense changes to allow these plans to work better and ensure that vital Medicare dollars are going to patient care," Nielsen writes. According to Nielsen, many "physicians are added to Medicare Advantage plans unknowingly," and the bill would "provide more transparency and ensure that insurers form a real network of physicians, rather than 'deeming' them participants because they treat one patient who is part of a plan." The legislation also would eliminate duplicate payments to MA plans for medical education, she writes. "The extra funds that threaten the long-term health of the Medicare program are too often just another bonus for insurers -- at the expense of patient care," Nielsen writes, adding, "As supporters of Medicare Advantage programs cry wolf, the Medicare payment cut goes into effect in July and will force physicians to make the difficult decision to limit the number of Medicare patients in their practices" (Nielsen, Wall Street Journal, 7/3).
- Judith Stein: Much "more is needed to pay for long-term care," but Medicare "does not push people into nursing homes" as Gottlieb maintains, Stein, executive director of the Center for Medicare Advocacy, writes in a Journal letter to the editor. "Medicare's home health benefit covers nurses and home health aides for people who meet coverage criteria for as long as it is medically necessary," but "Medicare's nursing home coverage is only for 100 days," according to Stein (Stein, Wall Street Journal, 7/3).
© 2008 Advisory Board Company and Kaiser Family Foundation. All rights reserved.
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Battle Over Medicare
posted by Gregory D. Pawelski on 7 Jul 2008 at 10:08 amFor five years now, Medicare has been paying private Medicare Advantage plans much more per enrollee compared with what the same enrollees would have cost in the traditional Medicare fee-for-service program. The money used to pay Advantage insurers is coming out of traditional Medicare.
It's time for the Congress to examine whether the extra payments to Medicare Advantage plans are the best use of tax-payers dollars for the beneficiaries the program is designed to serve.
These payments could be used to provide better benefits, like filling in the doughnut hole and reduce out-of-pocket costs for seniors and the disabled, as well as to create a viable alternative to the ineffective sustainable growth rate mechanism currently used to determine the physician payment update.
Traditional Medicare needs to be able to compete on a level playing field with private plans, which requires the elimination of these extra payments.
It is no mystery why prescription drug costs are vastly lower in Canada and Europe than they are here in the USA. Foreign governments negotiate with the pharmaceutical companies on drug prices. The result is that the pharmaceutical companies still find it profitable to sell drugs outside of the USA at 30% to 50% discounts, compared to U.S. drug prices.
Congress created the Medicare Part D prescription drug benefit. This law did two things: it guaranteed premium pricing for pharmaceuticals, by prohibiting Medicare from negotiating drug prices, and it provided hundreds of billions of dollars in U.S. taxpayer subsidies to pay for these premium drug costs.
But Medicare is so huge that the pharmaceutical industry would not walk away from this market, any more than it walked away from the Canadian or European markets. There is no problem with drug availability in Canada or Europe, and there would be no problem with drug availability within Medicare.
Even defense contractors and space agency contractors have to negotiate pricing with the government. The only industry which apparently gets to set its own government pricing, outside of the pharmaceutical industry, is the Iraq contracting industry, led by Halliburton. Every other industry has to negotiate. Letting them simply set the price for their products is ridiculous. It is simply "pay-back" for campaign contributions.
Simply give Medicare the ability to negotiate drug prices, and drug prices for Americans will go down, while those for the rest of the world will eventually go up, and there will be a more equitable sharing in the global costs of pharmaceutical research and marketing.
U.S. for-profit health care fundamentalism has the most de facto rationing, higher rates of uninsured, exclusions for pre-existing conditions, excessive deductibles and copayments, and shorter hospital stays and physician visits. It also has the most waste on administration, billing, marketing, profit, executive compensation, and risk selection.
The U.S. for-profit health care system is good at creating new drugs and technologies and marketing them to hospitals, physicians and patients. But our health care system is not so good at simple medicine like preventive care. Our pharmaceutical-based health care system is very good at creating new health care products that will make a lot of money, and where our health care system isn't profitable, it is a total failure.
It doesn't take a rocket scientist to figure out that the United States does a good job of developing and delivering new and expensive drugs to patients, because tht is the only thing we're good at. But it'll take a rocket scientist to figure out how this makes for a better health care system.
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