There’s a Trojan horse in the Medicare bill

By Laurence S. Jacobs, M.D.
Santa Fe New Mexican, April 10, 2015

Bipartisanship can work. The old flawed formula for physician reimbursement in Medicare (SGR) will finally be permanently canceled and replaced, so that physicians will no longer be looking at roughly 20 percent cuts in reimbursement every year, absent one-year congressional fixes.

That’s the good news about the bill recently passed by the House of Representatives (HR 2); the Senate will vote on it right after the current recess. Now here’s the bad, alarming news: The bill contains provisions intended to undermine and eventually destroy traditional Medicare, and replace it with progressive privatization.

This bill requires the payment of deductibles not coverable by Medigap policies, expands means-testing of Medicare premiums and imposes burdensome new documentation requirements on physicians in traditional Medicare. The results of these provisions will make Medicare more costly for everyone, restrict access and choice of physician in Medicare, and preferentially benefit private insurance plans, including Medicare Advantage plans.

The only way to avoid paying the deductible out of pocket will be to leave Medicare and join a private plan, like a Medicare Advantage plan. Such plans are more costly overall than traditional Medicare, and it has been estimated that their excess cost since 1985 amounts to over $282 billion. The expansion of means-testing, requiring higher- income seniors to pay higher premiums, seems likely to undermine support for Medicare by this relatively influential voting bloc.

The documentation requirements are sufficiently onerous that many physicians may opt out of traditional Medicare, or retire altogether, thus limiting choice of physician and access to care in traditional Medicare. The bill exempts from this documentation requirement “alternative payment methods,” which are more likely to be associated with contracts with private plans.

GOP members see this bill as part of their long-held goals of turning Medicare into a voucher-based program for private insurance plans (remember Paul Ryan’s plan?), and shifting more and more costs onto patients. Speaker John Boehner stated that this bill represents a step in the direction of “entitlement reform.”

This bill should not be passed unless the documentation, deductible and means-testing provisions are removed from it. If we had a single-payer health insurance system, like so many other industrialized nations, we wouldn’t be playing political ideology games with people’s health and their lives.

Laurence S. Jacobs, M.D., is emeritus professor of medicine at the University of Rochester in New York. He lives in Santa Fe.