Tucson Medicare HMO’s are not the bad guys

Opponents of Medicare Advantage have a mantra that says private Medicare plans receive fourteen percent more money per enrollee than is spent on the average Medicare beneficiary.  President Obama and legislators writing healthcare reform bills all agree that billions of dollars must be cut from Medicare Advantage plans over the next five years.

But it turns out an important government report has positive things to say about some Medicare Advantage plans. The good thing for Tucson is that these are the kind of plans we have here.

 Here are some excerpts from a March 2009 report by the Medicare Payment Advisory Commission. This group advises Congress on Medicare policy and payment issues.  The excerpts are from page four of the report.

“In aggregate, the MA (Medicare Advantage) program continues to be more costly than the traditional program. As an exception, HMOs continue to bid below Fee-For-Service (FFS), bidding 98 percent of FFS in 2009.”

 “MA plans provide enhanced benefits to enrollees, but, except for HMOs, which finance a portion of those benefits through bids below FFS, the enhanced benefits are financed entirely by the Medicare program and by beneficiaries—and at a high cost. For example, each dollar’s worth of enhanced benefits in PFFS plans costs the Medicare program more than $3.00.”

 “Quality is not uniform among MA plans or plan types. High-quality plans tend to be established HMOs; plans that are new in the MA program have lower performance on many measures.”

 So it looks like Tucson’s HMO’s actually save Medicare money because for every dollar Medicare spends on the average Medicare beneficiary, it pays 98 cents for each enrollee in a Medicare HMO.  As well, Tucson HMO’s have been around for many years and fall into the category of “established plans” which the report calls “high-quality”.  This kind of report gives me confidence that Tucson’s money-saving, high-quality HMO plans will be around for the future- as long as the politicians don’t throw the baby out with the bathwater as they try to reign in Medicare Advantage.

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