Its Purpose, Patients, and Impact
on Providers
Nancy Cooper
Coordinator, Health Policy Fellowship
May 13, 2014
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Objectives
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•
•
•
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Who does Medicare cover?
What services does it cover?
Who pays for services?
How does Medicare impact physicians?
How will the ACA impact Medicare?
How will the ACA impact you?
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Medicare
e = elderly
Veterans Affairs
Indian Health Service
Federal Employees Health Benefit
Program (FEHBP)
Medicaid
d = destitute
Children’s Health Insurance
Program (CHIP)
Federally Qualified Health
Centers(FQHCs)
http://www.ihs.gov/newsroom/factsheets/ihsyear2014profile
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Centers for Medicare and
Medicaid Services (CMS)
pays for health care for 110 million
elderly, disabled, and/or poor
Americans
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Medicare is the largest payer of health care
services in the US
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Health and Human
Services
$880 billion budget
Medicare $524 B
Medicaid $243 B
Total CMS $ 767 B
www.hhs.gov
Kaiser Family Foundation 3/17/11
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Medicare serves 50 million elderly and
disabled
Kaiser Family Foundation analysis of the CMS Medicare current beneficiary
cost and use file 2006
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Beneficiary Profile
65 and up
Half are poor
1/3 live alone
8 M non-elderly with
disability
2 M in long term care
7 out of 10 die of heart
disease, cancer, stroke
Medicare at a Glance, Kaiser Family Foundation Nov 2012
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Elderly and Poor
Dual Eligibles
Medicare 49
Million
Hospital coverage,
physician visits, drugs,
some post hospital care
9.2
M
Medicaid 60
Million
Long term care, glasses,
dental, pays some Medicare
premiums and cost share
AARP, Integrating Care for Dual Eligibles, 2012 11
Disabled: Medicare Social Security Disability Income
(SSDI)
Determined by a Consultative Exam (CE)
• Physician
• Psychologist
• Podiatrist
• Optician
• Speech/Lang. pathologist
Disabled and Poor: Medicaid Supplementary Security
Income (SSI)
www.benefits.gov.ssa
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B
http://medicareplansofamerica.com/wp/wp-content/uploads/2012/11/medicare-advantage-plans.jpg
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Medicare Part A: Hospital Insurance
–
–
–
–
inpatient hospital
skilled nursing facility
home health
hospice
No premium. $1,068 deductible
190 days in-patient psych covered
No charge for hospice or home health
Medicare at a Glance, Kaiser Family Foundation – Medicare Policy. Nov 2012
www.hhs.cms.gov
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Part A Out Of Pocket
Charged based on LOS in hospital
• No co-pay for 1-60 days
• $275 per day 60-90
• $550 per day 91-150
www.hhs.cms.gov
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After three midnights in a hospital . . .
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Medicare Part B
Supplemental Medical Insurance
• Covers physician visits, outpatient
hospital care, ambulatory surgical
services
• Labs, x-rays and durable
equipment,
• PT and speech therapy (limit of
$1,740)
• Out-patient mental health
• Home health
Preventive services









one wellness visit per year
shots
colorectal cancer screenings
PSA, PAP, mammogram
AAA
bone mass screening
diabetes monitoring
glaucoma screening
smoking cessation
www.hhs.cms.gov
Kaiser Family Foundation 2012: Medicare Primer
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Part B Out Of Pocket
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Medicare and FQHC
Patient pays no Part B deductible but is responsible for
co-pay . . .
UNLESS
•
•
•
•
FQHC-supplied influenza and pneumococcal vaccines
FQHC-supplied Hepatitis B vaccine (HBV)
Personalized prevention plan services
Any covered preventive service that is recommended
with a grade of A or B by the U.S. Preventive Services
Task Force
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Medicare Part C: Medicare Advantage
• HMO or preferred provider organization (PPO) cover A and B
and sometimes dental, vision, hearing, wellness services and
Rx
• Has out of pocket spending limits – no more than $6,700
• Special Needs Plans: coordinated care for frail, poor elderly
– “frailty payment adjustment” if they provide long term care & Medicaid services
• Costs about 16% more than fee-for-service (“original”)
Medicare
http://www.thenationalcouncil.org/galleries/policyfile/Dual%20Eligible%20Provisions%20of%20HC%20Reform%20Bill.pdf ;
www.hhs.cms.gov
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Medicare Part D: RX
Cost $55 B in 2011
Voluntary Rx benefit
Costs high as gov. can’t
negotiate prices for brand
name drugs
Kaiser Family Foundation 2012: Medicare Primer
CMS, 2010 Enrollment Information
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Part D: Prescription Drug Benefit
Premium averages $38.40 per month
http://kff.org/medicare/issue-brief/medicare-part-d-prescription-drug-plans-the-marketplace-in-2013-and-key-trends-20062013/
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Who Pays?
Beneficiaries pay
• Taxes
• Deductibles, premiums and co-pays ($2,600 yr)
Patient
pays in
$150,000
Medicare
pays out
$300,000
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Trust Fund: Payroll tax of 2.9%
General revenue,
premiums, and
state payments
General revenue
and premiums
> $85,0000 pay
higher premium
Not separately financed - capitated
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Worker-Retiree Imbalance
In 1965: 6 workers per retiree
In 2012: 2 workers per retiree
Institute for Health Metrics and Evaluation, University of Washington May 2012
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“The US Government is an insurance
company with a large army”
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High Cost of Dying
CMS spends $140 Billion on the last year of life – about $59,000
per decedent
33% Medicare patients have in-patient surgery in the last year of
life
Half of Medicare patients
see ten or more physicians in
the last 6 months of life
Dartmouth Atlas of Health Care
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Physicians are not paid for end of
life planning discussions
"The America I know and love is not one in which my parents or my
baby with Down syndrome will have to stand in front of Obama's 'death
panel' so his bureaucrats can decide, based on a subjective judgment of their
'level of productivity in society,' whether they are worthy of health care.”
Sarah Palin 8/7/09
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75% of terminally ill people want to die at
home – but only 35% do
“The hard question we face, then, is not how we can
afford this system’s expense. It is how we can build a
health-care system that will actually help dying patients
achieve what’s most important to them at the end of their
lives.”
Atul Gawande, M.D.
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The Silver Tsunami
. . . Enrollment will increase from 47 million to approx 74
million – number of beneficiaries over age 80 will triple.
Congressional Budget Office 2/1/12
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Physician Reimbursement
Reimburses at 80% of “customary and reasonable charge”
Fee for Service
Sustainable Growth Rate (SGR)
Physician Quality Reporting System
– Currently voluntary – earn 2% of Part B fees
– Mandatory in 2015: Part B payment will be ‘adjusted’ for
not submitting quality data
CMS.gov Affairshttp://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment
Instruments/PQRS/index.html?redirect=/pqrs
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Patient Protection and Affordable Care Act
(ACA): Impact on Medicare
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“Don’t Mess with Medicare”
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Raise the age of eligibility
Raise out of pocket costs
Raise taxes
Defined benefits (“ration”)
Means test (rich pay more)
Lower reimbursement
Policy Options to Sustain Medicare for the Future, Kaiser Family Foundation January 2013
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Good News for Seniors
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•
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Fill in donut hole in Medicare Rx
Reduce Hospital readmissions (1 out of 5)
Reduce Medicare premiums
Increase Medicare preventive services
Increase access and
quality for dual eligibles
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Carrots and Sticks for Providers
• Responsible for quality and costs; can earn
shared savings
• Primary Care team focuses on wellness and
coordination of care
• Goal: Keep people healthy and out of the
hospital
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Medicare Electronic Health Records
(EHR) Incentive Program
$44,000 bonus for ‘meaningful use’ of HIT
– The use of a certified EHR in a meaningful manner, re: eprescribing.
– Electronic exchange of health information to improve quality of
health care
– Submit clinical quality and other measures
-.5 to 5% penalty for no EHR after 2015
http://www.acatoday.org/content_css.cfm?CID=4576
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Bonus for Primary Care Providers
10% bonus to primary care physicians and surgeons
working in Health Profession Shortage Areas (HPSAs)
Incentive payments for PC services if patient stays out
of the hospital “Independence at Home”
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Medicare Value Based Payment
Modifier
Value-based ‘purchasing’ based on physician
performance and quality
New physicians could be ‘dinged’ as their cost
profiles are higher
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Increase Reimbursement
to Medicare Advantage
Now will
increase
payment by
.5%
ACA would
have cut
payment by
~ 2%
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Medicare Prospective Payment System
for FQHCs
From $117.67 (rural) and $129.02 (urban)
to $158.85
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Carrots and Sticks
for Hospitals
No payment for preventable readmissions
Reduce payment updates for hospitals,
home health and SNFs
Bundled payment for an episode of care
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Source: HFMA, Healthcare Reform: The Dust Settles, April 13, 2010 http://www.beaconpartners.com/avoiding-aco43
gotchas#sthash.c1C4CWV0.dpuf
Control Medicare Spending
Independent Payment Advisory Board to reduce
rate of growth – depoliticize process
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Impact of PPACA on Medicare
Increases in spending
(In Billions)
Kaiser Family Foundation. A Primer on Medicare. 2011
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Impact of PPACA on Medicare
Decreases in spending
(In Billions)
Kaiser Family Foundation. A Primer on Medicare. 2011
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Stay Informed
Kaiser Health News: www.kaiserhealthnews.org/
Health Affairs: www.healthaffairs.org/
AOA Advocacy: www.osteopathic.org
AACOM Advocacy www.aacom.org
Training in Policy
Studies (TIPS)
bcoppola@nyit.edu
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Thank you
ncooper@ohio.edu
CMS Office of the Actuary, Updated National Health Care Expenditure Projections 2009-2019; January 2011
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Enrollment Options
(It’s Complicated)
• Original Medicare (Part A & B) & Prescription Drug Plan (Part D) for
Rx
• Original Medicare, Rx and Medigap to cover what original Medicare
does not cover
• Medicare Health Plan
– Medicare Advantage (usually includes Part D Rx) Enroll between 10/15 – 12/7
– Medicare Medical Savings Account Plans – high deductible plan with
Medicare health savings account
• Contribution less than the deductible: good for the “Healthy Wealthy”
• Part A & B automatic at 65 w/ Social Security
• Can decline Part B if still covered under employer
http://www.medicare.gov/sign-up-change-plans/decide-how-to-get-medicare/decide-how-to-get-your-medicare.html
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