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Thursday, January 31, 2008

Part D: 3.1 million switched plans

By Larry Lipman | Thursday, January 31, 2008, 04:23 PM

About 3.1 million Medicare beneficiaries switched prescription drug plans last fall, according to figures released Thursday by the federal government.

Of those who switched, about two-thirds were low-income beneficiaries who were automatically reassigned so they would not have to pay a monthly premium.

The total number of beneficiaries enrolled in private drug plans under Medicare Part D increased by 1.5 million to 25.4 million, according to the Centers for Medicare and Medicaid Services.

Roughly 40 million elderly or disabled people, or 90 percent of the 44 million Medicare beneficiaries, now have some form of prescription drug coverage including 6.6 million in an employer- or union-sponsored retiree plan and 7.5 million covered by other federal or private plans, the agency reported.

Meanwhile, the federal cost of program is expected to be $117 billion lower over the next 10 years than had been projected last summer. The total expected cost to Medicare from 2008 to 2017 dropped from $915 billion to $798 billion.

A CMS news release attributed the reduced cost estimate to a slow-down in the rise of drug prices, lower estimates of how much the private plans will cost, and higher-than-predicted rebates from drug manufacturers.

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As we enter the third year, Medicare’s prescription drug benefit is proving a resounding success,” Health and Human Services Secretary Mike Leavitt said in a statement. “Enrollment continues to rise, customer satisfaction remains very high, and costs for beneficiaries and taxpayers are considerably lower than original projections.

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Bush planning $91 billion in Medicare cuts?

By Larry Lipman | Thursday, January 31, 2008, 04:01 PM

Reports that President Bush is again planning to call for tens of billions of dollars worth of Medicare cuts has drawn fire from a key House leader.

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Bush’s budget, scheduled to be released Monday, will call for a $6 billion cut in projected Medicare spending next year and $91 billion over five years, according to a story in today’s New York Times.

Last year, Bush proposed cutting Medicare by $4 billion and $65.6 billion over five years. Those cuts were not adopted by Congress.

“This budget will be dead on arrival,” said Rep. Pete Stark, D-Calif., chairman of the House Ways and Means’ health subcommittee.

Bush’s budget is expected to call for $83 billion in cuts to hospitals with the remainder coming from other health care providers. The hospital cuts would include:

  • A $15 billion across-the-board reduction in hospital payments

  • A $25 billion reduction in payments to hospitals that serve a disproportionately large number of low-income patients

  • $23 billion less for training hospitals

  • $20 billion less for hospital construction and equipment.

    Stark said Bush’s budget “would endanger the health care of America’s seniors, people with disabilities, and low-income children. We’ve known for years that his ‘compassionate conservatism’ was simply a slogan. These proposed cuts show his single-minded focus on starving popular and effective public programs, while protecting fat-cat insurance companies that are overpaid with taxpayer dollars.”

    Stark noted that Bush does not plan to reduce payments to private managed care plans under the Medicare Advantage program. The nonpartisan Medicare Payment Advisory Commission (MedPAC) has reported that Medicare Advantage plans are paid 12 percent more, on average, than the cost of traditional fee-for-service care.

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