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WH Denies Private Medicare Plan Increases

From the Wall Street Journal:

Rate Increases Denied to Some Private Medicare Plans

By JANET ADAMY And AVERY JOHNSON
September 22, 2010

WASHINGTON—The Obama administration said Tuesday it denied rate increases and benefit cuts sought by some privately run Medicare plans.

The move is a sign of the toughening regulatory climate for health insurers that could prompt some of them to leave the Medicare market in coming years.

Forcing still more people on to the government rolls, just as was always the plan.

The majority of people 65 and over get their Medicare benefits directly from the government. But some 11 million people are in Medicare Advantage, where a private insurer provides coverage. Medicare Advantage plans may supply additional benefits, such as gym club memberships, while giving people a narrower choice of doctors.

In June, federal officials received 2,100 bids from private insurers hoping to offer Medicare Advantage plans next year. Officials said Tuesday they denied rate increases and benefit cuts in 298 cases [more than 10%]. As a result, they said, Medicare Advantage premiums will be 1% lower on average in 2011

Isn’t a ‘command economy’ wonderful? Hasn’t it worked out wonderfully everywhere it has been tried? What could possibly go wrong here?

Officials said the government blocked insurers from taking excessive price increases or boosting their profits.

"For these plans we said, ‘No, you have to do better,’ " said Donald Berwick, the Obama administration’s Medicare and Medicaid chief

Lest we forget, Mr. Berwick is that great admirer of Great Britain’s National Health Service. That’s his idea of doing “better.” (And never mind that the NHS is down-sizing as fast as it can.)

Oh, and Mr. Berwick also believes in rationing. He has also pronounced that any civilized healthcare plan “must redistribute wealth.”

Last year, the federal Medicare agency didn’t deny any bids. "This is as dramatic a turn as I’ve seen from this agency in 20 years," said John Gorman, a consultant who helped insurers prepare bids.

And we ain’t seen nothing yet.

The move may carry some downsides. Mr. Gorman said that in some cases, the insurers were forced to run their plans at a loss. While it was generally too late for them to withdraw from Medicare Advantage for 2011—only a handful did—more might drop out for 2012 and force their customers to look for another plan

The bids for 2012 will bring bigger changes to Medicare Advantage mandated by the health overhaul passed in March. The government will begin cutting $136 billion in payments to Medicare Advantage insurers, which will likely force further cuts in benefits

These are just the beginning of those Medicare cuts that we were promised would never happen.

This article was posted by Steve on Wednesday, September 22nd, 2010. Comments are currently closed.

2 Responses to “WH Denies Private Medicare Plan Increases”

  1. U NO HOO says:

    I have Aetna Medicare HMO, can’t wait to see what happens to my premium and coverage.

  2. proreason says:

    Let’s not pull punches on Medicare and what will happen to it.

    The core concept of Medicare is so tragically flawed that it will inevitably destroy the country if it isn’t radically changed.

    The program is designed to give unlimited benefit for a limited cost. Repeat. THERE IS NO CAP ON WHAT MEDICARE CAN SPEND. There are some caps here and there, but most of the program is unlimitted. There is no getting around that the core concept is INSANE.

    Let me tell you how insane it is. For people under 65, a “full service” health insurance policy for a family of 4 will cost about $1500 per month, or about $375 per person. You probably don’t pay that much because your employer foots most of the bill, or because you don’t really have a full-service plan. And the cost is also dependent on the state you live in. Now:
    – that plan will have deductables, co-pays, caps, annual and lifetime limits.
    – the people with that insurance (counting children) are 30 to 40 years younger than 65 and have, on average, medical expenses that are a fractiion of the medical epenses that people 65 and older have.
    – yet, a 65 year old can buy a Medicare supplement plan for a total cost of about $250 per month that has no deductables, no co-pays, no-caps, and unlimitted benefits annually and lifetime.
    – in other words, for 2/3 the price, a Medicare recipient gets a medical plan by which they get many times the services.
    – Something like 65 million baby boomers will be Medicare recipients in the next decade. Over 20% of the country will be on a program that is belly-up by thousands (probably tens of thousands) of dollars per person, every year, and increasingly belly-up every year after year after year.
    – It’s INSANE. And it will destroy the country if it isn’t corrected.

    That’s why the unfunderd liabilities are over $50 trillion dollars. $50 trillion equals the entire national income for 3 years.

    It will destroy the country if it isn’t corrected.

    At the heart of Obamycare is one simple policy. Doesn’t matter how they try to hide it. THE GOVERNMENT WILL RATION HEALTHCARE FOR SENIORS. That’s not a guess. It’s not a hunch. It’s a 100% ironclad fact.

    Now, Obamycare is probably going to be repealed in 2013, but the core nation-destroying problem with Medicare will be even worse by 2013.

    The only way to solve the problem is to cap the amount that is spent on Medicare. And there are only 2 ways to do that. The Marxists’ way is to have the government ration care, based on rules that are established by politicians. People like Obamy and Pelosi will be deciding whether granny (and YOU) live or die. That’s Obamycare’s plan for every person in the country, not just seniors.

    The only other way is to let the free market make the rationing decisions. And the probable way that will happen is that the Medicare ‘benefit’ will be a payment to you that you must use to buy private health insurance. That will be another form of rationing, because the covered services will not, can not, be unlimited. However, in that way, private businesses will be competing and will inevitably find ways to get more done for less cost. But even knowing that, the private insurers will also have to (effectively) ration. The benefit to you is that you will be able to choose a company, insteand of having a Pelosi cram her personal demons down your throat. (An additional benefit is that the annual $200B in Medicare fraud will largely disappear and that money can be funneled back into the program to hold down the premium costs.)

    The choice really isn’t that complicated. The choice is who you want rationing your care once you are 65 and older: Nancy Pelosi or 20 to 50 private businesses that are competing to insure you, and you get to pick and choose among them.

    I would pick freedom in a heartbeat, every time.


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