Sunday, January 2, 2011
How to Rate the New Health Care Changes
• New rule for tax-free savings accounts. If you have an HSA, like I do, so called non-prescription "over-the-counter drugs" that are not actually prescribed by a doctor are no longer eligible to be paid from that account. This is the kind of rule that might look good to a bureaucrat, but to me it is ridiculous. People now will be calling for prescriptions for their Tylenol, resulting in wasted time and money by all of us. Instead of saving money, this will be a fiasco. Thumbs down!
• Health-insurance companies “medical loss ratio”. Plans will now be required to spend at least 80 to 85 percent of the premium for actual medical care and quality improvements for patients, instead of administrative costs. Those that fail to do so will be required to issue a rebate to their customers beginning in 2012. The US Department of Health and Human Services says on www.HealthCare.gov that this will protect up to 74.8 million insured Americans from unreasonable rate increases. Last year, in 2010, we saw large increases from insurance companies who were attempting to pad their revenue before this provision took place. Thumbs up!
• Closing the Medicare drug coverage “doughnut hole.” Drug companies are now required to provide a 50 percent discount on brand-name prescription drugs to Medicare recipients who fall into the coverage gap in the Part D drug plans. Also, federal subsidies will be phased in for generic prescriptions in the Part D coverage gap. This gap will be progressively be closed over the next 10 years. It would be better to require competitive bidding by these companies, but this is a step in the right direction. Thumbs up!
• Medicare bonus for Primary-care physicians and general surgeons. These doctors will receive a 10 percent bonus payment for treating Medicare patients, which should help to encourage better access, although it is not enough, in my opinion to make much of a difference. Thumbs up!
• Preventive care for Medicare recipients. In a big change of philosophy, seniors will now be able to get free preventive services that include annual checkups and personalized prevention plans. No more waivers! Thumbs up!
• Medicare Advantage changes. Medicare recipients are eligible each year to choose private insurance companies for their care, a system called Medicare Advantage. We have all seen the adds! In the past, these plans were eligible for payments that were higher than ordinary Medicare, and these costs were born by increased premiums for all Medicare beneficiaries. Now, Medicare Advantage payments will be tapered down over the next few years to eliminate this subsidy. The new law has already resulted in higher premiums for many Medicare Advantage plans, but it prohibits these plans from raising cost-sharing requirements higher than what is required under traditional Medicare. Thumbs up!
• Center for Medicare and Medicaid Innovation. This center is already up and running and has launched multiple initiatives to test new ways of delivering care to patients that reduce costs and maintain or improve quality. One idea is an Accountable Care Organization (ACO), which is a new entity in which health-care providers can work together to contract for and manage care. Work is already under way here in Whatcom County to try and build such a system! Thumbs up!
• Community Based Care Transitions Program. One of the most expensive problems in health care, that also is a sign of poor quality is the readmission of discharged patients to the hospital right after they are sent home. This program seeks to improve care for seniors after they leave the hospital, by coordinating care and connecting patients back to services in their communities. Thumbs up!
• Medicaid incentives for prevention of chronic disease. The plan includes grants for states to help begin support services for Medicaid (low-income) recipients to cope with chronic problems, such as tobacco use, weight control, and various health conditions. Thumbs up!
All in all, things are slowly moving in the right direction. More details here: http://www.healthcare.gov/law/timeline/index.html