This marks the sixth consecutive year that I have devoted a column to the annual publication Medicare & You.
For those new to Medicare, prior to the Open Enrollment period all beneficiaries receive a publication from the Centers of Medicare & Medicaid Services entitled Medicare & You (2020).
You now have a choice of receiving this publication in either electronic or paper booklet format. If you have never read this guide, I urge that you read it once from cover-to-cover. After you have become familiar with the contents, you can read the publication for updates each year.
For the first time in six years, both the front and back covers of the 2020 edition are the same as the 2019 publication. Also, the 2019 and 2020 editions have exactly the same number of pages. There were very few changes to the Medicare program this year and this is reflected in the content of the 2020 edition. Still, as usual, along with updates, some formatting changes have been made to clarify issues and improve the readability.
The inside of the front cover has been completely revised. Last year this page provided information on the distribution of the new Medicare cards. This year the focus is on eMedicare. Also, the Medicare.gov website now contains a relatively new section that allows you to look up the estimated costs of outpatient medical procedures.
To obtain this information, go to Medicare.gov/procedure-price-lookup. This year the publication emphasizes using the Medicare.gov website as well as creating your own MyMedicare.gov account.
Here is a summary of some of the changes to look for in each section.
Section 1 Signing Up for Medicare. No major changes were made to this opening section. As was the case last year, the guide states that the 2020 Part A and Part B premium amounts "were not available at the time of printing. To get the most up-to-date cost information, visit Medicare.gov later this fall."
Section 2 Find Out if Medicare Covers Your Test, Service, or Item. This is a section that you should always review. Look for a particular procedure or service that you will use this year to see if there are any changes in the coverage.
This year no new services have been added. The only major changes in this chapter are in the descriptions of Medicare diabetes prevention program and telehealth. Page 49 contains an important list of what is not covered by Parts A and B which you should always review.
Section 3 Original Medicare. There are no significant changes to this chapter.
Section 4 Medicare Advantage Plans & Other Options. The information on Advantage plans has been updated, including the information on End-Stage Renal Disease. The coverage on Special Needs Plans has been reduced. There is a new section (page 65) on making changes to your Advantage plan coverage after Open Enrollment ends.
Section 5 Medicare Supplement Insurance (Medigap) Policies. Starting in January, people who are new to Medicare will not be allowed to purchase Part C and F Medigap plans. Those who currently have these plans can continue to purchase this coverage. See pages 69-72 for more details.
Section 6 Medicare Prescription Drug Coverage (Part D). If you are enrolled in a Medicare Advantage Plan you can now join, switch or drop a plan between Jan. 1 and March 31 each year. This chapter has other important updated information. If you are enrolled in an Advantage plan you should always review this chapter.
Section 7 Get Help Paying Your Health & Prescription Drug Costs. On page 83, it is noted that the limits on receiving Extra Help have not changed from last year. For a single person, the income limit remains at $18,210 with resources limits of less than $14,100 per year.
For a married person, the yearly income limit is $24,690 with other resources of less than $28,150 per year. The various other Extra Help programs are also explained. If you feel you might qualify for Extra Help you should contact the Oneida County Office for the Aging/Continuing Care HIICAP Program at 315-798-5456.
Section 8 Know Your Rights & Protect Yourself Against Fraud. Because of the increasing problems with fraud and scams, expect updates to this section every year.
Section 9 Get More Information. Remember, if you call 1-800 MEDICARE (633-4227) for information you can say "Agent" at any time and you will be directed away from the automated system to a customer service representative. There is also more information on fraud in this chapter. This is another chapter that is updated every year and should be reviewed.
Section 10 Definitions. There are no changes in this chapter.
Section 11 Compare Health & Prescription Drug Plans in Your Area. This section is extensively updated every year. If your copy was mailed to an upstate New York mailing address, all the information in this section will apply only to providers in upstate New York.
Who do I contact in Oneida County for help? If you find that there are changes to your plan, you want to make changes in your plan, or simply want to review your coverage the Oneida County Office for the Aging/Continuing Care/NY Connects Health Insurance Information, Counseling and Assistance program (HIICAP) offices provide these services at no cost to Medicare beneficiaries. HIICAP offices are found at the following locations:
Copper City Community Connection, formally the Ava Dorfman Senior Citizens Civic Center, 305 E. Locust St., with hours of operation on Tuesday and Thursday from 10 a.m. to 2 p.m. While consumers are seen on a "first come, first served" basis you may call the center at 315-337-1648 to see if there are long wait times.
North Utica Senior Citizens Community Center, 50 Riverside Drive, Utica with hours of operation on Monday, Wednesday and Friday from 10 a.m. to 2 p.m. Consumers are counseled on a "first come, first served" basis. However, if you want to call ahead to see how busy the office is you may call the center's HIICAP program at 315-724-8680.
HIICAP services are provided by Oneida County Office for Aging and Continuing Care/NY Connects. Anyone with questions about HIICAP, including issues with your Medicare Advantage Plan, should call the program directly at 315-798-5456 and press 4 in the choice list. It will direct you to someone who can assist you.
Dr. William Lane is the owner of William Lane Associates, a gerontological consulting firm based in Homer, NY. He is writing a monthly column on issues related to health insurance for the OFA. He does not sell insurance, work for any insurance company or recommend any insurance products.
As health care shapes up to be a top issue in the 2020 presidential elections, Tuesday's Democratic debate in Westerville helped to define key differences among challengers to President Donald Trump.
The election might be a year away, but with Ohio's presidential primary coming March 17, it is not too early for voters to get serious about evaluating where candidates stand on the issues they care about most.
Regarding health care, on the far left flank of Democratic contenders are the "Medicare for All" proposals of Sens. Bernie Sanders and Elizabeth Warren.
Less extreme is the call by South Bend, Indiana, Mayor Pete Buttigieg for "Medicare for All Who Want It," which would offer a public option for those who prefer a government health insurance program before they are eligible for Medicare at age 65.
Sen. Kamala Harris of California used some of her time on the stage at Otterbein University to bring women's health issues into the conversation as she called out Republican state legislators across the country for increasing restrictions on reproductive rights, and Sen. Cory Booker picked up the baton to say men should also champion women's health care issues.
More conservative among Democrats are former Vice President Joe Biden and Sen. Amy Klobuchar of Minnesota, who both call for building on Obamacare, the federal health care reform law passed during the administration of President Barack Obama.
As Sanders describes it, his Medicare for All plan sounds more utopian than the actual government health coverage plan for those 65 and older. Sanders advocates universal health care access with no premiums, deductibles or copays. That goes beyond the existing Medicare system in which senior citizens typically pay a monthly premium for hospital and physician coverage and most also buy supplemental insurance to cover what Medicare doesn't.
While Sanders readily admits his plan would levy taxes to pay for coverage, he contends families would still pay less than what it costs them for private health insurance and that the wealthy and corporations would pay more.
Warren, who rose in polls to become Democrats' frontrunner this week, supports Medicare for All but lost credibility in Tuesday's debate by continuing to duck direct questions about how she would pay for it, insisting she would "not sign a bill into law that does not lower costs for middle-class families."
The notion of dismantling the nation's extensive private insurance market and putting all Americans into a government program is too extreme for most voters to stomach, no matter how it's funded.
Buttigieg is more mainstream; his proposal would leave existing private insurance in place but add a public option for the uninsured, making it free to low-income families and subsidized for middle-income families. He would cap health insurance premiums at no more than 8.5% of an individual's income to hold down private insurance costs.
Klobuchar and Biden also would seek to strengthen the existing health care system.
Klobuchar proposes an option to allow the uninsured to buy into Medicare (public health insurance for those 65 and older) or Medicaid (public health coverage for low-income and disabled persons).
Biden calls for a Medicare buy-in option and, like Buttigieg, he would cap the cost of private insurance at 8.5% of a person's income.
The viability of these seven candidates' campaigns will rise or fall in coming weeks in large part on their health plans.
Like many Americans, I'd support any of the more than 20 Democratic presidential candidates over the current occupant of the White House. They are all qualified, articulate, thoughtful, patriotic grownups. Not one of them spent the Fourth of July thanking the Continental Army for securing LaGuardia. Nor does any need a teleprompter to speak full sentences. What they do need is precise answers about our nation's top domestic problems.
Take health insurance. Sens. Sanders, Warren and Harris, Rep. Castro and Mayor De Blasio want to extend traditional Medicare (parts A, B, and D) to all Americans. But the other candidates? It's not clear.
Wishy washy is not a winning campaign strategy. Mayor Pete Buttigieg is an example. He said nothing precise in the debates, including on health care, and was rewarded with a drop in the polls.
How can a smart person run for president in 2020 and not have a concrete health care policy? Mayor Pete is supposedly the smartest of the group-a Harvard grad, Rhodes Scholar and former Naval intelligence officer. The mayor speaks English, Norwegian, Spanish, French, Italian, Maltese, Arabi and Dari. Yes, he knows his languages, but does he know his letters? In particular, does he know the letter "C"?
Imagine the mayor had said during the debates that he supports the current Medicare system - either Medicare Parts A, B and D or Medicare Part C - for the elderly, but that he wants Medicare C for everyone else. Had he done so, everyone would be debating Mayor Pete's plan C, not what Biden said about bussing when Kamala Harris was eight years old.
Medicare Part C, the so-called Advantage Plan, is the preferred option for almost 34 percent of Medicare participants. It incorporates private insurance. Participants can choose their own health insurance company with its own network of doctors and hospitals. The company you choose gets paid based on your pre-existing medical conditions. This keeps insurers from cherry-picking healthy customers. No Advantage plan can turn you down. And the government can control annual expenditures on Medicare Part C by simply deciding which procedures, medications and therapies are covered. Private insurance companies could provide supplemental coverage, call it Part E, for things not covered by C. But they'd also have to take on all comers at the same price.
Had Mayor Peter said the letter "C," maybe in Maltese (there is no equivalent in Daria), everyone would have said the following:
"Buttigieg not only speaks other peoples' languages, he speaks our language. He would have been advocating universal health insurance. This goes far beyond Obamacare, which still leaves 30 million Americans uninsured. He's going to let private insurance companies, including our employer plans, continue to provide us with insurance. He's going to keep private insurance companies from cherry-picking by providing payments to insurers based on our pre-existing conditions. He's going to require private insurers, including our own employer plans, to take all comers, including people who don't work for our employers. Hence, we'll never be denied coverage and our kids can join our plans and see our doctors. He's also going to operate under a fixed budget, by adjusting annually what's covered, so the sum of the Part C payments he makes to private insurers won't drive the country broke."
Mayor Pete could also use his smarts to advocate freezing the existing Social Security system, paying off, overtime, all benefits owed, and setting up a modern, fully-funded system for today's and tomorrow's workers.
There's a plan for this posted here. He could have pushed for mutual fund banking to ensure the banks never fail and blackmail us again. That plan is another click away. He could have discussed instituting a progressive consumption tax, a progressive payroll tax and a carbon tax whose revenues are rebated to let current and future generations benefit from saving the planet. And he could have talked specifics about a half-dozen other major reforms we need, including laying out the facts about America's terrible long-run fiscal condition.
Some of the smartest people in the world do the dumbest things. Mayor Pete is very smart. It's time for him to show it. The country doesn't care about resumes. It cares about answers. Mayor Pete needs to tell us precisely what he's going to do. Otherwise, he might as well conduct his candidacy in Norwegian. No one will know what he's saying and no one will care. But if he does start to lead with his brains, not just flaunt them, he'll find the country is behind him.
Laurence J. Kotlikoff is a William Fairfield Warren Distinguished Professor and professor of economics at Boston University.
A group seeking lower drug prices is launching new attacks on the pharmaceutical industry to stop them from nixing a policy that will require them to give steeper discounts for Medicare drugs.
The group Patients for Affordable Drugs Now released an ad on Tuesday highlighting the drug industry's attempts to cut a "backroom deal" with Congress to eliminate a provision of law that requires them to give a bigger discount for certain drugs covered under Medicare.
"The drug corporations are pushing for a rollback of good policy in order to pad their profit margins and make the rest of us foot the $4 billion bill," said David Mitchell, the group's founder, in a statement. "Both Congress and the public need to know and put a stop to it."
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The six-figure digital ad will run for an undetermined amount of time as negotiations in Congress continue, the group told the Washington Examiner.
[Also read: Senate advances bill to end pharmacy 'gag clauses']
The pharmaceutical lobby has been trying to eliminate a policy, inserted into a government funding bill in March, that closes a coverage gap in Medicare Part D, the program's prescription drug plan, called the "donut hole" a year early.
Under Part D, a private plan only covers up to a certain amount for prescription drugs. Once a senior's plan reaches this amount, then the senior has to cover their drug costs until they reach their catastrophic coverage level.
Seniors' 2018 plans cover up to $3,750 in drug costs, but once a senior reaches that level, they are in the donut hole. The senior gets out of the hole when their drug costs reach $5,000 overall, and then the insurance plan covers a majority of drug costs.
Obamacare mandated that the donut hole be closed in 2020, but it will now be closed in 2019 because of the March legislation. Technically the coverage gap still exists, but the senior will only have to pay 25 percent of the cost of their drugs from the time they enter and leave it.
Congress was able to close it early because the law raised the required discount that drugmakers have to provide for drugs in the donut hole.
Obamacare required drugmakers to cover 50 percent of the costs for drugs covered in the hole, but the omnibus increased that amount to 70 percent.
Patients for Affordable Drugs Now said that the pharmaceutical industry is lobbying lawmakers to decrease that requirement to 64 percent.
"This would result in a $4 billion windfall for the drug industry at the expense of patients," the group said.
By: Eric Bradner, CNN
Posted: Jul 08, 2019 09:31 PM CDT Updated: Jul 09, 2019 01:10 AM CDT
Joe Biden says he opposes fellow Democratic presidential contenders' push for a "Medicare for All" program because such an overhaul of the nation's health system could not coexist with the Affordable Care Act.
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(CNN) - Joe Biden says he opposes fellow Democratic presidential contenders' push for a "Medicare for All" program because such an overhaul of the nation's health system could not coexist with the Affordable Care Act.
The former vice president, in an exclusive interview with CNN's Chris Cuomo airing on Monday, argued that former President Barack Obama's signature health care law, also known as Obamacare, should be expanded to allow people to buy into government-run coverage.
But he said that "starting over would be, I think, a sin."
"That's why I'm opposed to any Republican who wants to dismantle it or any Democrat who wants to dismantle it," he said. "The idea that you're going to come along and take the most significant thing that happened -- that any president has tried to do and that got done -- and dismantle it makes no sense to me."
Biden is the only one of the four top-polling Democratic presidential contenders not to support single-payer health insurance. A switch to single-payer coverage, under a plan proposed by Vermont Sen. Bernie Sanders, would require a tax increase, though supporters have said Americans would spend less on health care overall because they would no longer be required to pay insurance premiums, deductibles and copays.
Some Democrats who have backed single-payer plans say private insurance would continue to exist. But that insurance would likely be supplemental, in addition to primary coverage through a government-run plan like Medicare.
Of his Democratic rivals -- including Sanders, Massachusetts Sen. Elizabeth Warren and California Sen. Kamala Harris, who have endorsed Medicare for All -- Biden said: "They are saying, if you're satisfied with your employer-based health care, you've got to give it up."
Biden has instead touted a more moderate approach of building from Obamacare -- which for nine years has been under GOP attack. A federal appeals court on Tuesday will hear oral arguments in a lawsuit challenging the law's constitutionality. The Trump administration is backing Republican states that are seeking to throw out Obama's signature legislative achievement, which expanded health coverage to include millions more Americans and barred insurers from turning away those with preexisting conditions.
Biden has argued for a "public option" that would allow people to opt into government coverage without eliminating employer-based insurance. It's the same approach Obama initially sought in 2009, but could not get Congress to include in the Affordable Care Act.
"Now, things are changing," Biden said of the politics surrounding a public option.
Biden also criticized his Democratic opponents for pushing ideas that would curtail the power of lawmakers and current Supreme Court justices, such as expansive use of executive orders, which Harris has proposed, and adding members to the Supreme Court, which South Bend, Indiana, Mayor Pete Buttigieg has backed.
"The idea that somehow we have decided that our system doesn't work anymore, which I'm hearing some of them saying -- that we're going to, you know, pack the courts; we're going to fundamentally change the way, I'm going to do what Trump did; if we take control, I'm going to go in there and I'm just going to, by executive order -- what are we talking about?" he said.
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Cancer is most prevalent in senior age groups. According to the Centers for Disease Control and Prevention (CDC), there were nearly 265,000 new cancer cases in 2016 in the United States within the age group of 65 to 69. Globally, seniors make up 60% of new cancer diagnoses.
Many of these new cancer patients have either just entered Medicare or have only been on Medicare for a few years. It's reassuring to know that Medicare has comprehensive coverage for cancer care.
Medicare Part A Cancer Coverage
Medicare Part A provides coverage for in-patient facility stays. When you need to stay in a hospital or skilled nursing facility (SNF), Part A pays for your bed and meals.
Hospital Stays with Part A
Like all parts of Medicare, Part A has a deductible. What makes Part A's deductible different from Part B is that the Part A deductible is per benefit period rather than per year. A benefit period starts the day you're officially admitted to the hospital and ends once you have been discharged from the hospital for 60 consecutive days.
As of 2019, the Part A deductible is $1,364. This deductible covers your first 60 days in the hospital. If after 60 days you're still in the hospital, you pay a daily copay of $341 for days 61 through 90 and $682 for days 91 through 150.
For example, if you are admitted to the hospital for surgery to remove your cancer, you will owe $1,364 plus any daily copays if you stay past 60 days.
Skilled Nursing Facility Stays with Part A
After your surgery, your doctor may recommend you finish your recovery in a skilled nursing facility. Your Part A deductible will also cover the first 20 days in an SNF. Medicare requires you have at least a three day stay in the hospital to qualify for a covered SNF stay.
If your recovery takes longer than 20 days, you pay a daily copay. From day 21 until day 100, your copay is $170.50 as of 2019.
Medicare Part B Cancer Coverage
Part B supplies cancer patients with the majority of their coverage. Part B will cover your outpatient medical services as well as medical services while in the hospital.
Medicare Part B will cover your doctor visits, lab work, imaging, surgery, chemotherapy, and durable medical equipment. When Part B accepts a claim, it will cover 80% of the claim after a $185 annual deductible (2019). In addition to the deductible, you pay a 20% coinsurance amount.
For example, if you get blood work done, an MRI, surgery, and a round of chemotherapy with a Medicare-approved bill of $20,000, then you will pay $185 plus nearly $4,000. You'll also owe a Part A deductible.
Medicare Part D Cancer Coverage
While Part A and Part B are handled by Medicare itself, Part D is handled by a private insurance carrier. Each Part D plan has to be structured the same way and abide by the same rules, but each carrier decides which drugs to cover and cost-sharing structures.
All Part D plans must cover at least two medications in every drug class. This allows your doctor to have a couple of options when prescribing a medication that is covered by your plan. What you pay for each medication will depend on your plan, the tier of the drug, and what stage of your plan you are in.
You may wonder why Part B covers chemotherapy, even though technically, that is a drug. Part B covers drugs that are administered to you by a medical professional, while Part D covers drugs you administer yourself.
Additional Medicare Plans
You have the option to buy a Medicare plan to help cover your out-of-pocket expenses. You can choose between a Medigap plan or Medicare Advantage plan. Each type of plan has many options to choose from.
For instance, a Medigap Plan G covers all out-of-pocket expenses for Part A and Part B services except your $185 deductible. Therefore, with Plan G, you'd only be responsible for the deductible in the example mentioned earlier rather than several thousand dollars.
You should study each type of Medicare plan available in your area to figure out which one is most cost-effective for you and your cancer coverage.
Danielle Kunkle Roberts
Mr Biden, vice president for eight years under former President Barack Obama, said a US$750 billion plan he introduced on Monday would strengthen Obama's landmark healthcare law known as Obamacare and include an option for a paid government-run plan.
Medicare is the government insurance plan for the elderly and Mr Sanders wants to shift Americans into a Medicare-based, single-payer system that largely eliminates private insurance.
Mr Biden called Mr Sanders' proposal an unrealistic and costly threat to Obamacare.
"Starting over makes no sense to me at all," Mr Biden said.
US Senator Sanders, an independent who has been a leader of the Democratic Party's progressive wing since a losing 2016 presidential run, said he helped pass Obamacare and defend it from Republican repeal efforts.
He said it was time to go further, however, and that his proposal was an effort to break the influence of corporate industry interests.
He called Mr Biden's criticism "absurd" and openly questioned which side Biden and others who oppose Medicare for All were on.
"At the end of the day, you've either got to be on the side of the people or the side of the health insurance companies. I know what side I'm on," Mr Sanders said after Mr Biden released his plan.
On Wednesday, Mr Sanders shrugged off critics who have questioned whether his plan should eliminate private insurance.
"I have never met one person who loves their insurance company," Mr Sanders said in a speech in Washington.
Both Mr Sanders and Mr Biden are looking to rebound from a dip in their opinion poll numbers after the first Democratic presidential debate in June.
The Sanders campaign, angered by Mr Biden's complaints about Medicare for All, ran an online quiz on Tuesday asking people to identify who had made various claims against the proposal. Options included Mr Biden, Mr Trump and Senate Republican Leader Mitch McConnell.
Four other White House candidates in the US Senate - Ms Kamala Harris of California, Ms Kirsten Gillibrand of New York, Mr Cory Booker of New Jersey and Ms Elizabeth Warren of Massachusetts - have signed on to Mr Sanders' Senate bill, although they have been less adamant about eliminating private insurance.
Ms Harris, who has risen in polls since the debate, said on CNN that her preferred version of Medicare for All would reduce but not end private insurance, and would include an opportunity to purchase supplemental insurance. The Medicare program for seniors now includes private supplemental plans.
Ms Harris also told CNN she would not favor a middle-class tax increase to pay for the plan. Mr Sanders has said he would pay for his bill with a combination of taxes on employers, individuals, businesses and the wealthy.
The liberal Urban Institute estimated the Sanders plan would cost US$32 trillion over a decade, with the additional taxes raising about US$15 trillion.
Republicans have criticized the Sanders bill as a socialist pipe dream that would be too costly and weaken the US healthcare system. They have promised to make it a main issue in the election.
Some Democrats worry Mr Sanders, who pushed eventual nominee Hillary Clinton to the left during their 2016 primary, would prevail on issues such as healthcare and leave the party vulnerable against Mr Trump.
"We can't let Senator Sanders be the reason we lose to Donald Trump. We can't afford more impossible promises from politicians," said presidential contender John Delaney, a former congressman who barely registers in opinion polls.
On Wednesday, Mr Sanders challenged his campaign rivals to reject donations from the health insurance and pharmaceutical industries, saying it was a crucial step toward fundamental reform.
"You can't change a corrupt system by taking its money," Mr Sanders said in his speech.
"If we are going to break the stranglehold of corporate interests over the healthcare needs of the American people, we have got to confront a Washington culture that has let this go on for far too long," Mr Sanders said.
The Sanders campaign said his pledge not to accept health insurance and pharma money would cover donations above US$200 from drug and health insurance industry lobbyists, executives and political action committees. It would not apply to rank-and-file workers
(Bloomberg) -- Donald Trump issued his most extensive criticism of presidential candidate Pete Buttigieg, the South Bend, Indiana, mayor who is at the top of the Democratic field in fundraising.
Buttigieg "runs a failed city," Trump said at a political rally in Greenville, North Carolina, on Wednesday. "His city is doing so badly."
The president said that Vice President Mike Pence, the former Indiana governor, had told him Buttigieg "never did a good job; I'm so shocked to see him running."
Buttigieg reported raising $24.9 million in the last three months, more than any rival who was in the race for the entire second quarter. Former Vice President Joe Biden, who entered the contest in late April, raised about $22 million in the first two months of his campaign. But Buttigieg trails in polls, ranking fifth behind Biden and Senators Bernie Sanders, Elizabeth Warren and Kamala Harris, according the RealClearPolitics average of national polls.
"If that's the hot young star, I guess I just don't know stardom anymore," Trump said of the mayor, who is 37. "That's not a star."
He went on to ridicule the idea of Buttigieg meeting with foreign leaders including Xi Jinping of China, Kim Jong Un of North Korea and Vladimir Putin of Russia.
Sanders Adds Fresh Fuel to Health-Care Fight
Bernie Sanders on Wednesday added fuel to a debate over health care consuming the Democratic race, calling on his presidential rivals to reject donations from the health care industry.
In a sweeping defense of his "Medicare for All" proposal that would eventually end private insurance, the Vermont senator said the party shouldn't accept contributions of more than $200 from a list of pharmaceutical and health-insurance industry political action committees, executives and lobbyists.
"We have to confront a Washington culture that is corrupt, that puts profits ahead of people," Sanders said in a speech at George Washington University in Washington.
Sanders is emphasizing health-care policy as a major point of difference with his rivals, particularly front-runner Joe Biden, who said this week that Medicare for All wasn't realistic and that he would instead update the Obama administration's Affordable Care Act by adding a public option.
The donations pledge takes aim at both Biden and South Bend, Indiana, Mayor Pete Buttigieg. Biden showed contributions totaling $19,100 from employees at 14 of the companies on Sanders's list, an analysis of his report filed with the Federal Election Commission shows. Almost $8,800 came from donors with the title of "executive" or "CEO."Buttigieg reported almost $44,700 in contributions from employees at 34 entities on Sanders's list. Only about $2,000 came from donors who listed "executive" as their occupation, with the most contributions coming from those with "HIV prevention specialist" and "physician" as titles. -- Laura Litvan, Bill Allison and Mark Niquette
Trump Holds Rally in Swing State North Carolina
President Donald Trump on Wednesday will travel to Greenville, North Carolina, for his first political rally since a furor erupted over his remarks directed at four Democratic congresswomen that his opponents have called racist.
Trump won North Carolina in 2016. Polls indicate that it will be a swing state in 2020: A Public Policy Polling survey released June 20 showed Trump trailing former Vice President Joe Biden and Senator Bernie Sanders in hypothetical general election matchups.
The president is likely to use the campaign stop to renew his attacks on Democrats he says are beholden to their most liberal flank.
In a series of tweets Sunday, he told four liberal U.S. representatives, all women of color, to "go back" to the "crime infested places from which they came." The tweets have been called racist by many Democrats and some Republicans. Trump has defended the posts and repeated his invitation to the lawmakers -- Alexandria Ocasio-Cortez, Ilhan Omar, Ayanna Pressley and Rashida Tlaib -- to leave the country. They are all American, and only Omar was born outside the U.S.
Democratic groups have seized on the controversy. The Progressive Change Campaign Committee plans to air a TV ad that names prominent Republicans "for their silence about Trump's racism." -- Alex Wayne
Sanders Wants Rivals to Reject Big Pharma Money
Bernie Sanders is calling on his Democratic presidential rivals and the rest of the party to reject donations from pharmaceutical and health-insurance industry political action committees, executives and lobbyists.
Sanders's campaign says he will argue in a speech he's set to deliver Wednesday that it is impossible to overhaul the U.S. health care system while also taking donations from the industry.
"You can't change a corrupt system by taking its money," according to prepared remarks. "If we are going to break the stranglehold of corporate interests over the health care needs of the American people, we have got to confront a Washington culture that has let this go on for far too long."
Sanders will release a pledge for other candidates in which they would agree not to knowingly take any donations of more than $200 from those industries. The pledge lists more than 150 companies belonging to the Pharmaceutical Research and Manufacturers of America and America's Health Insurance Plans, including Allstate Insurance and Eli Lilly & Co.
The challenge will come as part of a broader speech in which Sanders, who has seen declines in recent national polls, will defend his "Medicare for All" health proposal. Former Vice President Joe Biden, the current front-runner in the race, said this week he wants to add a public option to the Affordable Care Act, arguing that it is a far less costly approach. -- Laura Litvan
Harris Ties Biden in California With a Big Jump
Senator Kamala Harris's support in California has surged, a new Quinnipiac University poll shows, putting her in a statistical tie with former Vice President Joe Biden among Democrats in her home state.
The survey found 23% of those voters support Harris, while 21% backed Biden. Vermont Senator Bernie Sanders had 18% support, while Massachusetts Senator Elizabeth Warren received the backing of 16%. The poll had a margin of error of 5.7 percentage points.
But Harris's support is far stronger than an earlier Quinnipiac poll on April 10, two weeks before Biden announced his presidential bid. In that poll, Biden had 26% among California Democrats, while Sanders had 18% and Harris trailed in third place with 17%. Warren lagged with 7%. Biden also led Harris in a previous LA Times/Berkeley survey from June.
As a California senator, it's crucial that Harris show strong support among home-state voters, but she has struggled to do so in the crowded Democratic field.
The poll of 519 Democrats and respondents leaning Democratic was conducted between July 10 and 15. -- Greg Sullivan
Harris's Medicare for All Has a Private Option
Democratic presidential candidate Kamala Harris said her Medicare for All plan wouldn't end private insurance. At least not right away.
"Medicare for All means that everyone will have access to health care and that cost will not be a barrier," Harris told CNN in an interview aired Wednesday.
"As it relates to private insurance, there will still be supplemental insurance, but yeah, transitioning into Medicare for All will at some point reduce the requirement for insurance because everyone will have access to health care," she said.
Harris has been accused of waffling on her health care plan, embracing Medicare for All but trying to find a narrow path between two competing constituencies in the Democratic Party.On one side are progressives such as Elizabeth Warren and Bernie Sanders who embrace a Medicare for all system that would eliminate most private insurance. On the other side are moderates, including front-runner Joe Biden, seek to preserve Obamacare but would add on new government-run options in an effort to maximize consumer choice.
Harris said on CNN that private insurance would remain a "supplemental" option, under her plan. But that would eventually not be needed as there won't be a need. She also said she doesn't see a middle-class tax hike needed to fund her proposal, and she'd instead eye more targeted new revenue sources such as going after Wall Street. -- Terrence Dopp
Here's What Happened Tuesday:
Bernie Sanders said that as president he would sit down with authoritarian leaders like North Korea's Kim Jong Un or Russia's Vladimir Putin even though he remains critical of President Donald Trump's "respect and affection for" dictators around the world. "Should we sit down and negotiate with them? Absolutely," the Vermont senator and Democratic White House contender said at a Washington Post Live news event.Joe Biden said his presidency wouldn't just be a continuation of Barack Obama's two terms. "The world's changed. It's different. We have the same value set, he and I," Biden said. "It's a different world. The same things don't apply."A new poll of New Hampshire voters shows Joe Biden leading the Democratic field with 24% of likely voters. The survey by CNN and the University of New Hampshire showed Elizabeth Warren and Bernie Sanders with 19% each. But the trend line may be notable: she's up by 14 points since April and he's down by 11 points since then.
Coming Up This Week:
On Wednesday, Trump is holding an evening rally in Greenville, North Carolina.
CNN and the Democratic National Committee, the organizers of the next round of Democratic debates on July 30 and 31, will announce on Wednesday which 20 candidates will qualify for the event. On Thursday, CNN will broadcast a live drawing that will determine the lineup of 10 candidates on each night.
Nineteen of the two dozen or so Democratic candidates are participating in forums organized by AARP this week.
A Wednesday event in Cedar Rapids will feature Representatives Tim Ryan and Tulsi Gabbard, and Senator Michael Bennet.The Friday event in Sioux City will feature Senator Elizabeth Warren, author Marianne Williamson, former Representative Beto O'Rourke and tech entrepreneur Andrew Yang.The Saturday event in Council Bluffs will feature Senator Bernie Sanders, South Bend Mayor Pete Buttigieg, Montana Governor Steve Bullock and New York City Mayor Bill de Blasio.
--With assistance from Alex Wayne, Terrence Dopp, Greg Sullivan, Laura Litvan, Mark Niquette and Bill Allison.
To contact the reporter on this story: Josh Wingrove in Washington at firstname.lastname@example.org
To contact the editors responsible for this story: Wendy Benjaminson at email@example.com, Alex Wayne, Max Berley
For more articles like this, please visit us at bloomberg.com
©2019 Bloomberg L.P.
President Donald Trump on several occasions has taken credit for making Medicare "stronger." In one instance, he said, "Medicare will be $700 billion stronger over the next decade thanks to our growth."
In fact, Medicare's finances have worsened since he took office, and economic growth is not expected to help the program as much as he claims:
The latest Medicare trustees report says the Medicare Part A trust fund, which covers payments to hospitals, will run out of money by 2026, three years earlier than projected just last year. That's partly because the tax cut law that Trump signed last year will reduce Medicare revenues and increase expenses.
Medicare remains on an unsustainable path. The annual cost for all four parts of Medicare - including physician payments and prescription drugs - is expected to more than double from $710 billion in 2017 to $1.44 trillion in 2027, and general revenues will increase as a share of Medicare financing from 41 percent in 2017 to 49 percent in 2032.
The Congressional Budget Office in April estimated that economic growth could increase all payroll tax revenues, including Social Security, by $92 billion over the next 10 years. That's far short of Trump's $700 billion figure, which he said was just for Medicare.
Financial Outlook Worsens
Trump made claims about strengthening Medicare - the health insurance program for senior citizens and the disabled - several times over the course of three days in early September.
In remarks at the White House on Sept. 5, Trump boasted that "we have done more as an administration than any other administration in already less than two years," including on health care. "We're saving Medicare," he said.
A day later, while campaigning in Montana for Republican Senate candidate Matt Rosendale, Trump said, "Matt Rosendale is going to make sure we're not touching your Social Security and your Medicare is only going one way. That's stronger."
On Sept. 7, the president made the specific claim about the impact of economic growth on Medicare. His remarks came at a fundraiser for GOP Rep. Kristi Noem, who is running for governor of South Dakota against Democrat Billie Sutton. The winner will replace outgoing Republican Gov. Dennis Daugaard.
Trump, Sept. 7: Medicare will be $700 billion stronger over the next decade thanks to our growth. And I will tell you that Billie Sutton, and people like Billie Sutton, Democrats with a very strong liberal leaning, they're going to destroy your Medicare and they're going to destroy your Social Security. I'm leaving your social - it's going to be left alone, your Social Security will be left alone. We're not touching your Social [Security], we're just going to make it stronger. We're going to make the country stronger. We pay for things through growth. The way we're growing right now will be able to pay for things that nobody thought possible. Remember during debates they'd say, "How are you going to do it?" I said, "We're going to do it through growth."
Medicare and budget experts we contacted said Medicare's financial outlook has worsened and economic growth is not expected to provide much help.
"If anything, some of the administration's actions appear to be working in the opposite direction, at least as measured by the status of the Medicare Part A trust fund," Juliette Cubanski, associate director of the Kaiser Family Foundation's Program on Medicare Policy, told us in an email.
Cubanski is referring to the Medicare trustees' most recent annual report, which provides an updated projection on the financial status of the Hospital Insurance, or HI, trust fund.
Medicare is made up of four parts: Part A (payments to hospitals), Part B (payments to physicians), Part C (Medicare Advantage, or private insurance options) and Part D (prescription drug coverage). Those parts are funded by two funds: the Hospital Insurance (HI) trust fund, which is funded primarily by a payroll tax paid by workers and their employers, and the Supplementary Medical Insurance (SMI) trust fund, which is funded primarily through general revenue and beneficiary premiums.
The Medicare Part A trust fund is designed to be self-supporting, but the trustee report warns that the financial outlook for the fund "has deteriorated as compared to the projections in last year's annual report."
The HI fund spent more on hospital payments than it received in income from 2008 through 2015, the report said. Although the fund had a slight surplus in 2016 and 2017 and a balance of about $200 billion prior to 2017, the trustees say deficit spending will return this year and accelerate in the coming decade, exhausting the fund earlier than expected.
"The estimated depletion date for the HI trust fund is 2026, 3 years earlier than in last year's report," the report said. At that point, Medicare would be able to pay only 91 percent of hospital expenses, as the table on page 29 shows. (The SMI trust fund, because of how it is structured, cannot be depleted.)
The trustees, in part, cited the tax cut law as a reason the HI fund is expected to run out of money more rapidly than previously expected.
The Tax Cuts and Jobs Act of 2017 that Trump signed in December repealed the so-called individual mandate in the Affordable Care Act, which requires people to have health insurance or pay a penalty. The repeal, which is effective in 2019, is expected to increase the number of uninsured Americans and that, in turn, will increase Medicare Disproportionate Share payments made to hospitals that serve large populations of low-income people without insurance.
"he percentage of people without health insurance is expected to increase. Because the change in this percentage is a factor used in determining payments to Medicare disproportionate share hospitals for uncompensated care, these payments are expected to increase as well," the trustees' report said.
Also, about 8 percent of HI trust fund revenues come from a federal income tax on Social Security benefits. But the tax cut law reduced the federal income tax rates, meaning a portion of Social Security benefits will be taxed at a lower rate and generate less income for Medicare, as explained in a July report by the Congressional Research Service on Medicare's finances.
"A stronger economy is definitely one of the factors that could help to shore up the status of the Medicare Part A trust fund, since the majority of funding for that comes from payroll taxes," Cubanski, of the Kaiser Family Foundation, said. "But all of the factors that affect Medicare financing would have to be going in a positive direction, whereas the administration has taken other steps that have actually made Medicare's funding situation worse."
As we said, Medicare Part A is just one part of the program for seniors and the disabled. In total, Medicare cost $710 billion in 2017 and about 41 percent of that was paid through general revenues (see Table II.B1). Total Medicare expenditures will more than double to about $1.44 trillion by 2027, as illustrated by the CRS chart below, and the share of general revenues will increase to 49 percent by 2032, the trustees report said.
Separately, the Bipartisan Budget Act of 2018, which Trump signed in February, will have a negative impact on all parts of Medicare, the trustees' report said.
That law, among other things, repealed the Independent Payment Advisory Board, a 15-member board created by the Affordable Care Act to reduce Medicare costs. As designed, the board would make recommendations for cutting spending that could only be overridden with a three-fifths majority of both houses of Congress, or Congress could institute its own reductions of an equal amount recommended by the IPAB. (The IPAB had not yet been formed.)
"The expenditures in this year's report are higher than last year's mostly due to (i) the Bipartisan Budget Act of 2018, which eliminated the Independent Payment Advisory Board and removed payment caps for certain therapy services, and (ii) higher projected Medicare Advantage (MA) payments attributable to higher risk scores for beneficiaries enrolled in MA plans," the report said. (Risk scores are estimates of the cost of care for beneficiaries.)
Economic Growth Projections
As for Trump's claim that "Medicare will be $700 billion stronger over the next decade thanks to our growth," the Committee for a Responsible Federal Budget and Cubanski, of the Kaiser Family Foundation, were not aware of any economic projections that would improve Medicare's finances by that amount.
The CRFB referred us to Table A-1 of the nonpartisan Congressional Budget Office's April 2018 Budget and Economic Outlook, which projects the impact of economic revisions since June 2017 - including effects of newly enacted legislation and updated economic data. The CBO projected that the economic changes will result in an additional $92 billion in all payroll tax revenues, which includes Medicare and Society Security, over 10 years.
More than half of the additional economic growth was the result of recently enacted legislation, specifically the 2017 tax act, the 2018 budget act and the fiscal year 2018 appropriations law, the CBO report explained. "Updated data for key measures from the national income and product accounts (NIPAs) also led to economic revisions. (The NIPAs, which are produced by the Bureau of Economic Analysis, track components of the nation's economic output and income that CBO uses in its economic analyses,)" CBO said.
So why did the president say Medicare will be $700 billion stronger over 10 years because of economic growth?
The White House told us that the president was referring to Medicare and Social Security, not just Medicare. It said the administration's policies will result in "extra economic growth that is on track to add more than $700 billion to Medicare and Social Security revenues."
More precisely, the White House estimates that economic growth will generate an additional $858 billion more in payroll taxes over 11 years, from 2018 to 2028, compared with CBO projections.
The White House took the administration's nominal gross domestic product projections for each year from 2018 to 2028 (Table 1 of the White House's Mid-Session Review of its fiscal 2019 budget proposal) and applied the CBO's payroll tax revenue as a share of GDP for each year (Table 4-1 of CBO's Budget and Economic Outlook) to estimate total payroll tax revenues for those 11 years. It then subtracted CBO's payroll tax revenue projections from its own and got $858 billion in additional payroll tax revenue due to growth from 2018 to 2028.
But there are three problems with that logic, beginning with the fact that it doesn't support what the president said.
First, the president said he strengthened Medicare by $700 billion over 10 years, but the White House gave us the impact of economic growth on all payroll revenues - including Social Security, which is the largest.
We found that the White House (see Table S-4) estimates $129 billion more in Medicare tax revenue than CBO (see tab 4).
So, Trump is wrong about the impact of economic growth on Medicare even by his administration's own numbers.
Second, the White House projects higher payroll tax revenues based on sustained economic growth through 2028. It projects real GDP will grow at an average annual rate of nearly 3 percent for the next decade - which is about a percentage point higher than most economic forecasters predict.
In August, CBO projected real GDP will grow 3.1 percent this year and 2.4 percent next year, but over the 10-year budget period, from 2018 to 2028, CBO projects an average annual growth rate of 1.9 percent.
The consensus among economic forecasters is that tax cuts and increased federal spending will stimulate the economy, but only in the short term, according to the CRFB.
For example, the most recent median forecast of the Federal Reserve Board members and Federal Reserve Bank presidents, released June 13, is for 2.8 percent in 2018, 2.4 percent in 2019 and 2.0 percent in 2020. But the "longer-run" median forecast is 1.8 percent.
Third, although Trump says "we pay for things through growth," the additional payroll tax revenue generated by economic growth - even at the level projected by the White House - is a small fraction of the cost of Social Security and Medicare.
The administration's proposed budget for mandatory programs (Table S-4) shows that it expects to spend $8.75 trillion on Medicare from 2019 to 2028, but take in only $3.6 trillion in Medicare payroll taxes. As for Social Security, the administration expects to spend $13.66 trillion and take in only $11.6 trillion.
Budget experts say mandatory programs remain on track to consume an increasingly greater share of federal spending.
In its April report, CBO estimated that "spending for people age 65 or older in several large mandatory programs - Social Security, Medicare, Medicaid, and military and federal civilian retirement programs" - will increase from 38 percent of federal spending in 2018 to 45 percent in 2028. (That does not include federal spending on interest.)
Marc Goldwein, senior policy director at the Committee for a Responsible Federal Budget, told us in an email: "There has been no major Social Security or Medicare legislation enacted, so the programs are essentially on the same path they were on before the President took office."
John Delaney, enjoying some time in the spotlight.
Justin Sullivan/Getty Images
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If you want to understand how the Medicare for All movement has utterly transformed the Democratic debate about health care-and why it's almost certainly doomed to fail in Congress-consider John Delaney.
A moderate former congressman from Maryland, Delaney has ever-so-slightly distinguished himself from the pack of other forgettable Caucasian men who decided to run for president in this year's Democratic primary as the most aggressive and articulate critic of single-payer health care. (Joe Biden is also aggressive, but not especially articulate.) He has claimed that pushing "Medicare for All" is an act "political suicide," because the bill would force Americans off of their private insurance, including union members who cherish their hard-bargained health benefits and are skeptical of giving them up in favor of a government plan. (He's big on bringing up the fact that his own father was a union electrician.) He's also suggested that cutting payment rates to doctors will force a wave of hospital closures. During Tuesday night's debate, he played the role of a moderate heel, grappling with Bernie Sanders and Elizabeth Warren. "We don't have to go around and be the party of subtraction, and telling half the country, who has private health insurance, that their health insurance is illegal," he said. This kind of rhetoric has, unsurprisingly, earned Delaney the scorn of the left. (It doesn't help that he's a former businessman who made part of his fortune in health care finance.) On Tuesday, Warren accused him of recycling Republican talking points, and later leveled him with her most memorable line of the night: "You know," she said, "I don't understand why anybody goes through all the trouble of running for president of the United States just to talk about what we really can't do and shouldn't fight for."
Here's the funny thing about all this: Delaney's own health care proposal is not actually all that moderate, except in comparison to full-bore, Sanders-style single-payer. Under his plan, all Americans under 65 would enroll in a basic government insurance plan that more or less includes Obamacare's essential health benefits (Medicaid would be merged into this program). Individuals and companies could then buy supplemental insurance that covered additional services. Medicare for seniors would remain untouched.
One thing you might notice about this approach is that, despite Delaney's debate stage rhetoric, it would actually create a lot of upheaval in the insurance market, and require pretty much everybody with an employer-sponsored plan to change their coverage in some way. A second thing you might notice is that it is far to the left of what Hillary Clinton proposed in 2016. Her big move to appease progressives that year involved backing a public health insurance option for the Obamacare exchanges. Ambitious? Sure. But much less so than the bona fide national health care plan Delaney, an annoying middle-of-the-road squish, is envisioning.
This speaks to how successful Medicare for All proponents have been at shifting the debate on health care within the Democratic Party. The idea of "moving the Overton Window" might be a bit of cliché, and it sometimes serves as an all-purpose excuse to propose whatever impractical policy idea someone dreams up at a bar in Brooklyn. But when it comes to the national health care debate, advocates really have forced almost everybody in the party to think bigger. (The very important exception, unfortunately, is Joe Biden, who is basically running on a plan similar to Clinton's.)
And yet, while Delaney oddly embodies some of the movement's success, he also embodies why Medicare for All would almost certainly fail in Congress. Never mind the Senate, which Democrats may not win, and even if they do, will be inhabited by moderates like Joe Manchin. Just consider the House. During his time on Capitol Hill, Delaney was a truly moderate Democrat. But he wasn't the most moderate-Govtrack ranked him as the party's 10th most conservative House member-and after the 2018 midterms, the party's moderate wing grew. The latest Medicare-for-All bill introduced in the House drew 117 co-sponsors, meaning it would need support from about 101 more members to pass. Grassroots progressives could try to put pressure on the caucus's right flank to back single-payer health care. But it seems more likely those lawmakers will listen to their own moderate voters and powerful Democratic interest groups like the unions Delaney keeps talking about, many of which are in fact unenthused by a Sanders-style plan. The AFL-CIO, for instance, has said that it will back Medicare for All if "it retains a role for workers' health plans."
The arguments you heard Delaney making Tuesday night? Chances are you'd hear a lot of the same talking points around the Capitol before single-payer finally sunk.
The Trump administration is looking to make "disruptive" changes to U.S. drug pricing to bring down costs for patients, Health and Human Services Secretary Alex Azar said.
"Every player in the system has their share of blame," Azar said in an interview at Bloomberg headquarters in New York on Wednesday, adding that he's working on overhauling the system. "Part of that is going to be some fairly large, disruptive changing of the rules of the road."
The administration has taken aim at the list prices of prescription drugs, and some drugmakers have pulled back from proposed hikes in recent months. Pharma companies have long pointed to the role of middlemen such as pharmacy-benefit managers in pushing drug prices higher. PBMs collect rebates from drugmakers in exchange for preferred status on drug plans, which helps boost sales of their products.
"Pharma companies set their price," said Azar, a former pharmaceutical industry executive. "They may be doing so within an economic system that has various incentives, and my job is to change the system."
He was careful not to single out PBMs as the sole reason the system is working the way it is.
"I am not blaming pharmacy-benefit managers for the position we are in around drug pricing or the dynamic of rebates," he said. "The pharmacy-benefit managers do an incredible job negotiating discounts, rebates in our system. In fact, a major part of the president's plan is that we're further empowering pharmacy-benefit managers," referencing Medicare drug programs for the elderly.
In August, Health and Human Services granted private insurers, which provide coverage to about 20 million seniors through Medicare Advantage, new powers to bargain over drugs administered in doctor's offices or hospitals. The government and consumers in those plans spent $25.7 billion in 2015 on drugs administered in a doctor's office or hospital.
Azar also said the rebate system could potentially be replaced in part by discounts that consumers receive at the pharmacy counter.
In July, HHS submitted a proposal to the White House that would curb kickback exemptions that allow drugmakers to offer insurers and pharmacy-benefit managers rebates. Details of the proposal weren't available, but its title provides a clue to the changes being considered: "Removal Of Safe Harbor Protection for Rebates to Plans or PBMs Involving Prescription Pharmaceuticals and Creation of New Safe Harbor Protection."
It could represent a sweeping shift in how drug prices are set in the U.S. and potentially eliminate some of the opacity that surrounds the system. Azar wouldn't comment specifically on what was in the proposal.
"There will be margins, there will be businesses," he said, implying the changes aren't designed to dismantle companies. "They will reorient their business models and the channel will reorient around any changes we make to the rules of the road."
Regulators have also been focused on how to increase the use of biosimilars, which are less expensive copycats of high-priced biologic drugs that often cost in the tens of thousands of dollars. Makers of these lower-cost alternatives have said that incentives in the system have made it challenging for them to compete against brand-name equivalents.
Azar said his ultimate desire would be to make it so that pharmacists could freely substitute cheaper biosimilars for their high-priced counterparts.
He's seeking to create as "robust" a market for biosimilars as exists for generic drugs, without laying out a specific timeframe for this initiative.
The introduction of biosimilars was expected to cut billions of dollars in drug spending from the health-care system but some drugmakers say it hasn't worked that way. Drug giant Pfizer Inc. is currently suing rival Johnson & Johnson over what it argues is anti-competitive behavior that has prevented patients from taking Pfizer's less-expensive version of J&J's blockbuster Remicade.
- With assistance by Blake Dodge, Jared S Hopkins, and Robert Langreth
(Updates with information about impacts to companies in eleventh graf.)
Feds ease rules on cheaper coverage, sparking consumer warnings on benefits.
August 1, 2018 By Andy Miller
Fewer benefits. Riskier coverage. Buyer beware.
The Trump administration issued a final rule Wednesday that promotes the sale of more "short-term'' health plans, but the move immediately drew criticism from consumer advocates and health care industry organizations.
The short-term plans don't have to cover pre-existing conditions and can provide a limited range of benefits. Many such plans do not cover prescription drugs, maternity care, mental health or substance abuse treatment. The tradeoff is that the premiums are cheaper.
The White House action allows people to buy limited-duration health coverage that lasts up to 12 months and renew that coverage for a maximum of 36 months. The Obama administration, citing consumer protections, had limited such plans to less than three months, and they were not renewable.
President Trump has touted the rule change as producing "much less expensive health care at a much lower price. We're finally taking care of our people."
The administration estimates that premiums for a short-term plan could be about one-third the cost of comprehensive coverage required under the ACA.
A short-term plan "is cheap, but you get what you pay for,'' Russ Childers, an Americus health insurance agent, told GHN on Wednesday. "It may not pay the benefit you think it might."
Kaiser Family Foundation did a survey this year of current short-term plans and found that:
** 43 percent do not cover mental health services.
** 62 percent do not cover substance abuse treatment.
** 71 percent do not cover outpatient prescription drugs.
** None cover maternity care.
"The administration's rule change is dangerous for Georgia consumers,'' said Laura Colbert of Georgians for a Healthy Future, a consumer advocacy group that supports the ACA. "Because many consumers shop for insurance based on premium price, these plans will look attractive but when consumers need to use their coverage, they may find that the services they need are not covered and they are left with large medical bills.
"The administration is irresponsibly condoning short-term plans as quality, affordable coverage and putting Georgians at risk," Colbert said Wednesday.
The administration action comes at a time of increasing stability for Georgia's health insurance exchange, created by the ACA.
Last month, the Georgia insurance department released proposed premiums for the state's 2019 insurance exchange that ranged from about 2 percent to almost 15 percent. Those hikes are modest compared with the 2018 Georgia exchange hikes, which exceeded 50 percent for the four participating health plans.
The action on short-term plans is part of the administration's and Republican lawmakers' campaign to weaken the ACA. Next year, because of legislation passed in 2017, there will no longer be a tax penalty for someone who opts to not have insurance or who buys a short-term plan.
Short-term plans join "association health plans" for small businesses as the administration promotes lower-cost insurance options that cover less. Such plans can be offered across state lines and are also designed for self-employed people, The Associated Press reported.
Bill Custer, a health insurance expert at Georgia State University, said Wednesday that he sees "no other rationale'' for pushing short-term health plans other than "undermining the ACA markets."
These plans may attract healthier consumers who earn too high an income to receive a subsidy under the ACA exchanges, Custer said. Insurers offering these plans will have to balance a lower price with providing enough coverage to attract people, he said.
"They may market it to look better than what it is,'' Custer added. "It's going to be difficult for consumers to understand exactly what they're buying.''
The White House acknowledged these cheaper plans are not for everyone. "We make no representation that it's equivalent coverage," said Jim Parker, a senior adviser at the U.S. Department of Health and Human Services. "But what we do know is that there are individuals today who have been priced out of coverage."
NFIB, a small-business advocacy organization, issued a statement that said "today's final rule by HHS is another positive step for small-business owners that are seeking more affordable, flexible, and predictable options for themselves and their employees."
But the American Hospital Association issued a statement Wednesday claiming that the new rule "will reintroduce, to an already shaky individual market, health plans that do not constitute true 'insurance.'
"They could end up costing a patient far more by covering fewer benefits and ensuring fewer critical protections, like covering pre-existing conditions. Patients could find themselves responsible for their entire medical bill without any help from their 'health plan.'
"For providers, these products will lead to increased bad debt, with underinsured patients unable to afford the care they need but that is not covered,'' the AHA statement said.
The hospital organization added that these plans would remove younger, healthier people from the risk pool and driving up costs for those who remain.
By siphoning off younger or healthier consumers, the short-term plan expansion will add up to a 1.7 percent increase to premiums next year, according to the industry group America's Health Insurance Plans, Kaiser Health News reported.
Insurance agent Childers agreed that more short-term plans may skim off healthier patients from the regular insurance market. "No one is buying them if they've been sick or have been sick,'' he said.
Some in the industry say they're developing "next generation" short-term plans that will be more responsive to consumer needs, with pros and cons clearly spelled out. Major insurer United Healthcare is marketing short-term plans, the AP reported.
The nonpartisan Congressional Budget Office estimates that roughly 6 million more people will eventually enroll in either an association plan or a short-term plan. The administration says it expects about 1.6 million people to pick a short-term when the plans are fully phased in, The AP reported.
Jan Dubauskas, general counsel for the IHC Group, an organization of insurance carriers headquartered in Stamford, Conn., told Kaiser Health News that she expects IHC to offer 12-month versions as soon as the rule goes into effect, which will be 60 days after it is published.
Georgia insurance department officials told GHN that they believe these short-term health plans "have served the public interest relatively well over the years, generally helping many consumers by bridging health coverage between employment-related group health insurance plans. Our experience with these products has never caused any patterns of consumer complaints regarding any of the relatively few insurers offering these short-term limited-duration products."
The state officials said that they "are gratified to see that the former 3-month maximum duration federal rules have been stricken, and replaced by new rules.''
The agency said it's ready to assist any individual who has questions about insurance plans through its toll-free number in Georgia at (800) 656-2298 or through website www.oci.ga.gov
Democratic presidential candidates Sen. Bernie Sanders (I-VT) and Sen. Kamala Harris (D-CA) both support Medicare-for-all. But they really don't agree on what that is. Drew Angerer/Getty Images
Sen. Bernie Sanders's campaign says Sen. Kamala Harris's "Medicare-for-all" plan - one that establishes universal health care through both government-run and private health insurance - is "privatizing Medicare."
"Her plan is centered around privatizing Medicare, enriching insurance executives and introducing more corporate greed and profiteering into the Medicare system - and even then, waiting for 10 years before any changes happen," Faiz Shakir, the Sanders's campaign manager, wrote in a fundraising letter to Sanders's supporters.
Harris's campaign strongly rejects this characterization. "Current Medicare includes private plans through Medicare Advantage," Harris spokesperson Ian Sams said. "It's just a misleading and false attack."
Harris's plan, released just ahead of the second Democratic presidential debate, has been panned by the original Senate author of Medicare-for-all. While Harris saw her stock rise after the first presidential debate, where she traded barbs with Joe Biden, she's muddied the waters on her true position on health care. She's signed on to Sanders's bill and backed abolishing private insurance, only to walk it all back. Her new plan clarified her distance from Sanders, but only seemed to only muddle the debate over Medicare-for-all further.
So does Harris support privatizing Medicare? No. Is her Medicare-for-all plan privatizing Medicare? Not outright.
Harris's plan is designed around the current Medicare system, which already incorporates private insurance. She proposes that, over a 10-year period, everyone would transition to an expanded Medicare; she would allow for private insurance to play in a program structured like Medicare Advantage, which currently gives seniors the option to choose from a slate of private insurance options. It would cap out-of-pocket costs at $200.
This is markedly different from what Sanders has popularized as Medicare-for-all: a single-payer system that looks less like how Medicare actually operates today and more like something in Canada, where private insurance is essentially eliminated and every American is put on an expanded government-run program. The underlying principle of the Sanders plan is that private insurance, which operates on profits, can never truly incentivize care.
There's a reason why the Sanders team is sounding the alarm bells here. Medicare Advantage has been riddled with scandal, taking government dollars to feed a for-profit health care industry. Just last year, federal investigators found the private plans denied claims "in an attempt to increase their profits." It's true that Medicare Advantage has played a significant role in expanding private insurance's role in Medicare.
"This has been evolution, not a revolution, in Medicare: a quiet but persistent increase in private insurance in Medicare," Tricia Neuman, a Medicare expert with the Kaiser Family Foundation, said of the current system. "Private insurers have been increasingly playing a role in the program."
Harris promises her version of private plans would be strongly regulated. But whether her plan would see a continued expansion of private insurance within Medicare boils down to two questions that Harris's plan doesn't answer, Neuman says: 1) Will insurers be able to operate profitably? 2) Will consumers have a compelling reason to choose privately run Medicare plans over the public program?
We just don't know yet.
The growing role of private insurance in Medicare, briefly explained
Talk about "privatizing Medicare" often goes back to what conservative former House speaker Paul Ryan championed for many years: a plan that phased out Medicare and replaced it with a voucher-like program to buy private health insurance - essentially giving seniors fewer resources to cover their care. But Medicare is extremely popular, and Republican's abandoned that idea.
Of course, that's not what Harris is proposing. That's why Sanders's language here about Harris's plan is particularly inflammatory. But the reality with Medicare today is that Democratic and Republican policies over several decades have allowed private insurance to flourish under Medicare.
Harris wants to keep the existing Medicare structure. Since the 1970s, Americans in Medicare have been able to enroll in private health plans - both HMOs and PPOs - instead of the original Medicare program. These private plans operate differently than traditional Medicare. The government pays the private Medicare Advantage plans a fixed fee per enrollee, whereas traditional Medicare is a pay-by-service system.
Medicare Advantage has been popular with both enrollees and for insurers. Currently, roughly a third of Medicare enrollees, or 22 million Americans, are on some kind of private plan. Enrollment in Medicare Advantage has nearly doubled over the last decade.
For seniors, the plans are allowed to offer more benefits than traditional Medicare does, like hearing, dental, and vision, and the premiums are typically lower than having to buy supplemental coverage for traditional Medicare. And for insurers, they've been profitable. They usually restrict the network of health care providers, have healthier enrollees, and have been found to engage in some fraudulent practices to inflate the payments from the government, like claiming enrollees are sicker than they actually are.
"This is pretty much a slow but significant change for the Medicare program, but not what people would think of when they think of Medicare. It's looking more and more like a marketplace of private insurers," Neuman said.
The question is a matter of priorities: Should the government be paying private insurance companies and help them reap profits when it could expand coverage and benefits through a public program? This year, payments to Medicare Advantage plans were basically the same as the cost of traditional Medicare. But there's also research that shows enrollees in Medicare Advantage plans usually use fewer services and have less health care spending. That suggests that there's a lot of fluff in the system, giving federal dollars to private insurers who are then turning a profit.
Harris says private insurance would be strongly regulated in her plan, but we just don't know how
Harris says her plan will have guardrails on these private plans to ensure they're not engaging in fraudulent practices or unnecessarily taking tax-payer dollars. Private insurers would have to have their plans certified under "stricter" guidelines, the plan says. We just don't know what those stricter guidelines are yet. And without those details, it's hard to tell whether this plan would continue to grow private insurance's role in Medicare.
The plan cites one restriction: To qualify, the private plan would be "reimbursed less than what the Medicare plan will cost to operate," which is clamping down on a payment system that's really allowed for private insurers to flourish in Medicare. In other words, the federal government would pay the private plans less than it spends on the public option.
At the end of the day, Harris's plan pits a private option against a public one. Legislation would determine exactly how much room the private plans would have to differentiate themselves from the public plan. The plan doesn't have details around the extent of benefits the private plans would be able to offer - a major factor in why Medicare Advantage is currently so popular.
And that, for the Sanders camp, opens too much risk for a profit-centered industry to enter the health care system. It leads to another gripe the Sanders campaign has with the Harris plan: It's phased in over 10 years, more than the length of a two-term presidency, and according to the Sanders team, that's too much time for the big insurance industry to step in and take over.
For now, Harris's plan is just the broad outlines of a health care system that would incorporate a vastly expanded public option with a private system. But it isn't yet legislation. Her mission here is more political. This is a plan designed explicitly to address various interests and concerns in the health care debate, including the role of private insurance.
JULY 27, 2018 On Wednesday, the Centers for Medicare and Medicaid Services (CMS) released the calendar year (CY) 2019 hospital outpatient prospective payment system (OPPS) proposed rule addressing payments to hospital outpatient departments and ambulatory surgery centers (ASCs).
In the proposed rule, CMS made several significant proposals, including to expand a controversial policy that pays off-campus hospital departments at the same rate as physician clinics and to extend cuts for 340B-related drugs to such sites as well. Several proposals address the opioid epidemic, including un-packaging non-opioid pain medications in ASC surgical payments. CMS also requested input, while not formally proposing, a renewed Competitive Acquisition Program (CAP)-type model for purchasing Part B drugs through the Center for Medicare and Medicaid Innovation (CMMI).
Comments on the proposed rule are due by September 24 with a final rule expected by around November 1.
Overall, CMS estimates that outpatient hospital payments would decrease by a net of 0.1 percent ($80 million nationwide) relative to 2018 rates, which reflects a general market basket-based increase, then decreased by several adjustments, including for productivity, the off-campus policy described above, and a cut mandated by Congress.
Major teaching hospitals take the brunt of the hit, seeing an average decrease of 0.8 percent, while all other hospitals, on average, would see a 0.5% increase to payments.
For ASCs, citing comments received during the 2017 rulemaking cycle, CMS proposes to update rates based on the hospital market basket index instead of the consumer price index-urban (CPI-U) as it ordinarily does.
CMS estimates that ASC payments would increase by $32 million in CY 2019 compared to if they were based on the CPI-U approach. With all factors considered, ASC rates would increase by 2.0 percent in 2019, reflecting a 2.8 percent projected hospital market basket minus a 0.8 percent multi-factor productivity adjustment.
Expansion Of Site Neutrality For Outpatient Services
Section 603 of the Bipartisan Budget Act of 2015 (BBA) reduced payments to off-campus provider-based hospital departments to the amount paid to physician clinics for the same service, effective January 1, 2017. The BBA excepted certain sites from these payment reductions, namely those already billing under the hospital outpatient rate as of the date of enactment of the BBA (i.e., existing sites were grandfathered) and emergency services furnished by off-campus emergency departments.
In the proposed rule, CMS aims to extend this site neutrality policy beyond what is required by the BBA. It would cut payments to currently grandfathered sites for certain clinic visit services, citing concerns about the existing trend where more services are shifting away from doctor offices and into hospital outpatient departments. The proposal is not budget neutral, which is why it contributes to the net overall reduction in hospital payments that would be effectuated under the rule. According to the agency, about a fifth of the gross $760 million in savings from the proposal would accrue to patients in the form of reduced cost-sharing.
Further, CMS proposes to apply the site neutral payment policy to new lines of service added to previously st sharing exempted/grandfathered outpatient departments, positing that Congress would not have intended to allow such new families of service to be exempted from the BBA policy. The agency also notes that observed growth in new service lines at these outpatient facilities may have been an unintended consequence of the initial policy that it believes is best halted.
New 340B-Related Cuts
Last year, CMS finalized a policy to pay covered outpatient drugs and biologicals acquired by hospitals under the 340B Program at a rate of average sales price (ASP) minus 22.5 percent, rather than ASP plus 6 percent that is typical under the payment system. This cut did not initially apply to off-campus hospital departments subject to the site neutrality policy described above, because the agency essentially now treats those sites like physician clinics.
Here, CMS is now reversing that policy and would extend these cuts for 340B drugs to off-campus departments already facing payment cuts under the site neutrality policy. The agency would continue to exempt rural sole community hospitals, children's hospitals, and certain cancer hospitals.
CMS proposes modifications to patient experience measures included in the hospital quality reporting program to remove three pain communication-related metrics. The change stems in part from concerns that providers may feel unduly pressured by patients seeking opioid-based therapies who can, in turn, report the physician neglected their preferences.
Further, citing the President's Opioid Commission work, the agency adds new separate payment for non-opioid pain medications that otherwise function as a supply under the ASC payment system. It cites reports showing a 70 percent decline in such products after they lose pass-through status. CMS notes it is not applying the same change to hospital outpatient departments, suggesting that there is less evidence of behavioral change when pass-through status is removed in that setting.
RFI On Using Authority For Part B Competitive Acquisition Program Through CMMI
As signaled in the Administrations' drug pricing Blueprint, CMS seeks comment on "key design considerations" for testing a CAP-like model through CMMI, citing comments submitted in response to a Request for Information (RFI) that accompanied the document.
Specific questions are posed in four categories: 1) included providers and suppliers; 2) included drugs and biologicals; 3) beneficiary cost-sharing, 4) protections and fiscal considerations; 5) model vendors; 6) regulatory barriers and transparency issues; 7) manufacturer participation; and 8) model scope.
Initially established under the Medicare Modernization Act, the CAP program ultimately languished due to lack of provider or vendor participation. A pagereflecting the operation of the program is still available on CMS's website.
Relatedly, CMS also seeks comment on how to promote interoperable electronic data exchange across providers and adds a new RFI on price transparency, including making charge information publicly available.
There are several other policies in the proposed rule that I won't address here but can be skimmed on the helpful fact sheet accompanying the release. Happy reg spelunking.
An increasingly popular culprit in the debate over high drug prices is the pharmaceutical rebate, the after-the-fact discounts that form the heart of the nation's arcane - many would say broken - market for prescription drugs.
Now, a growing chorus wants to get rid of them, or at least change the way they are applied after drug companies have already set their prices. Rebates, critics say, have pushed up the list price of brand-name drugs, which consumers are increasingly responsible for paying. Insurers generally get to keep the rebates without passing them along to their members.
Last week, the drug industry's largest trade group, the Pharmaceutical Research and Manufacturers of America, took aim at the rebate system, proposing a change to the way middlemen handle rebates, and how those companies are paid.
And the Trump administration has taken the first step toward eliminating a "safe-harbor" provision that allows rebates to be paid in Medicare's Part D drug program without violating federal anti-kickback laws.
The details, though sparse, briefly caused the fall of the stocks of major pharmacy benefit managers like Express Scripts and CVS Health as investors worried that company profits would be hurt by the rebate's demise.
Here's a rundown on everything you need to know about rebates.
What is a rebate?
Pharmaceutical rebates are similar to the type that you get when you buy a toaster - discounts that are redeemed after the transaction has taken place.
Except with the toaster, you get to keep the money. With drug rebates, it's the insurer or employers who usually reap the benefit.
Under the current system, drug makers set a list price for their products, then negotiate with pharmacy benefit managers like Express Scripts or CVS over how much of a discount they will provide off that list price.
The size of the rebate depends on a range of factors, including how many drugs are used by the insurers' members, and how generously the product will be covered on a formulary, or list of covered medicines. Companies that offer bigger rebates are often rewarded with better access like smaller co-payments.
Most of the rebate - and sometimes, all of it - goes to those who are paying the bill for the drugs, mainly insurers or large employers who cover their workers' health care. Pharmacy benefit managers usually keep a percentage of the rebate as payment.
Insurers and employers get their rebates in lump sums that they say are often used to offset general health care costs and to hold down premiums.
What's all the fuss about?
Although rebates have been used to negotiate drug prices for years, they didn't catch much attention until 2011, when CVS, which operates one of the country's largest pharmacy benefit managers, announced it was excluding 34 drugs from its national formulary.
The rebate then became a potent negotiating tool, pitting drug companies against each other in an effort to secure a place on the formulary. Other benefit managers, like Express Scripts, soon followed suit.
But that has led to an escalating game, where drug companies raise their list prices to maintain their profits and to offer bigger rebates.
Some say the system has created a series of perverse incentives, where the middlemen have an interest in keeping the list price high. In addition to pharmacy benefit managers, wholesalers and pharmacies are also paid based on a percentage of the list price.
Drug makers - on the defensive after weathering attacks by President Trump, other elected officials and the public - have pointed fingers at the pharmacy benefit managers, saying they are under pressure to raise list prices to keep all of these players happy.
But pharmacy benefit managers and insurers disagree, arguing that rebates are a diversion and that their negotiating tactics have kept total drug costs in check. As proof they point to data that shows that in 2017, net spending on brand-name drugs grew only 1.9 percent, according to IQVIA, a drug research firm, while list prices grew 6.9 percent.
In a twist, the pharmaceutical companies cite the same research to showthat drug prices are not as steep as they seem.
How are consumers affected?
Even as insurers' drug spending has grown slowly, critics say the rebate game has served to inflate the list price of drugs, which consumers are increasingly responsible for paying. This is especially true for expensive specialty drugs, which treat serious conditions like cancer and multiple sclerosis - and whose prices have been skyrocketing.
As the cost of these products has gone up, insurers have raised deductibles and out-of-pocket contributions so that many of the sickest Americans must now pay thousands of dollars a year to cover their drug costs. These out-of-pocket costs are calculated using something close to the list price of a product, not the net price.
CONSUMERS AND HIGH DRUG PRICES
Many Americans are struggling to afford life-saving treatments for diseases like diabetes, multiple sclerosis, and cancer.
The Price They Pay
March 5, 2018
What's being proposed?
Alex M. Azar II, the secretary of health and human services, has singled out rebates as a primary way that patients' costs could fall.
"Right now, everybody in the system makes their money off a percentage of list prices," Mr. Azar testified in June before a Senate committee. "We may need to move toward a system without rebates."
Last week, the Trump administration signaled that it might try to end the "safe harbor" exemption that protects rebates from falling under anti-kickback laws. That would affect government programs like Medicare's Part D drug plans, but it wouldn't affect rebates in private plans - like those offered by employers. Changes to large programs like Medicare often have a rippling effect across the industry.
Pharmacy benefit managers and insurers warn that eliminating rebates could face legal hurdles, and said that the move could wind up raising consumers' premiums because insurers and employers use their rebate payments to plug other holes.
"Plan costs in the short run would go up, that's just the reality of the situation," said David Dross, the national leader of the managed pharmacy practice at Mercer, which negotiates with pharmacy benefit managers on behalf of employers.
Doing away with rebates won't fix other problems. The companies that sell the most expensive drugs - newly approved products that cost hundreds of thousands of dollars a year - don't offer many discounts because they have little to no competition. IQVIA, the drug research firm, found that rebates amounted to about 40 percent of the list price for treatments of some diseases, like diabetes. But they reduced the list price by only 10 percent in treating other diseases, like cancer.
The Trump administration is also considering a proposal, first floated last fall, that would give a portion of rebates to Medicare beneficiaries at the pharmacy counter. The move would lower out-of-pocket costs for people with high drug bills, but could increase premiums for Medicare drug plans. Private insurers, like UnitedHealthcare, have also recently introduced plans that offer these "point-of-sale" rebates to some of their members.
How likely are rebates to disappear?
The drug industry, though it hasn't specifically called for an end to rebates, has targeted the discounts and blamed the pharmacy benefit managers for the current situation. The industry is one of the most powerful lobbying forces in Washington, and with the support of Mr. Azar - until recently a top executive with Eli Lilly - they are not to be underestimated.
Kara Eastman, the Democratic nominee in Nebraska's Second Congressional District, tells a story while campaigning about visiting her mother while she was dying from cancer. Her mother's medicals bills were stacked so high on the kitchen table, Eastman says, that when she visited, they couldn't see each other through the piles. Just one of her mother's pills cost $2,500 a month.
Eastman decided to run for Congress to offer alternatives to the skyrocketing cost of health care. She campaigns calling for Medicare for All and further solutions to the crisis of unaffordable prescription drugs. Her message is resonating. She beat a well-known opponent in her primary by a few hundred votes.
Spending on prescription drugs is growing faster than any other sector of our health-care system. Drug companies, meanwhile, are raking in record profits, far higher than those in other industries-and they are spending considerably more of it on buybacks and dividends than on research and development. Most importantly for their bottom line, they are breaking records with their spending to influence Congress to protect their monopolies.
Drug company revenues soared from $534 billion in 2006 to $775 billion in 2015. That's billion with a "b."
According to a study by researcher Adam Gaffney, Americans spend more on outpatient drugs than the residents of any other industrialized nation-$1,026 per capita annually. The average in advanced industrial nations is $515; in Denmark, it's just $240. The problem isn't that Americans use four times the drugs that Danes do; it's that drug prices are much higher in the United States than anyplace else. In 2014, a daily 50-unit dose of insulin glargine cost $186 a month, after applicable discounts, in the United States-but only $63 in the United Kingdom and $46 in France.
In fact, U.S. taxpayers are paying twice. First, their taxes fund the research and development of new drugs: Federally funded studies contributed to the science behind every single one of the 210 drugs approved between 2010 and 2016. Taxpayers, for example, funded the development of Crestor, a popular medication to lower cholesterol. Now Crestor is sold by the private pharmaceutical giant AstraZeneca, which made over $16 billion in profits on Crestor alone during a three-year period.
It's clear that simply strengthening regulations on pharmaceutical corporations is not enough. Such corporations will prioritize lining their pockets over saving the lives of everyone who needs their medications, when the laws permit that-as they do in the United States. And when they do invest, they will always invest where there is the greatest potential for profit, not where there is the greater potential benefit to the public health.
One way to address that dilemma is to create a taxpayer-owned drug company to produce and distribute medications at affordable prices-especially drugs that have been developed with U.S. taxpayer dollars. Unlike private corporations, this public drug company would focus on developing drugs based on public need rather than perceived profitability. The company could use private contractors to develop and manufacture the drugs, but it would own the patents and therefore ensure that everybody has access to them. Economist Dean Baker has pointed out that this type of model is how the Department of Defense operates to create many weapons of war.
The United States would not be the first country to create a national drug company. Brazil, Cuba, South Africa, and Sweden all have publicly owned drug companies. While there would be a cost to setting up a public drug company, Baker and others have shown that the savings on drug prices in the United States could fully offset the added costs of a such a company. Depending on the scope of that company, Baker has shown savings of hundreds of billions of dollars per year.
This is not just good policy. It's good politics, too.
The Progressive Change Campaign Committee (co-founded by one of the authors) recently polled a cross-section of Republicans, independents, and Democrats in swing and Republican-leaning congressional districts on support for the idea of creating "a publicly-owned not-for-profit pharmaceutical company to compete against private drug companies, to create more competition in the marketplace and stop big drug companies from jacking up prices for our seniors."
In the Third Congressional District in Kansas, currently represented by Republican Kevin Yoder, 61 percent said they support the idea, 23 percent are opposed, and 16 percent are not sure.
In the First Congressional District in Wisconsin, currently represented by Republican Speaker Paul Ryan, 69 percent support the idea, 20 percent oppose it, and 11 percent are not sure.
In the Third Congressional District of New Jersey, currently represented by Republican Tom McArthur (who introduced the bill that gutted much of the Affordable Care Act), 66 percent support the idea, 19 percent oppose it, and 14 percent are not sure.
These are overwhelming bipartisan numbers that reflect the impact that big pharma's greed is having on Americans across the country. Families everywhere are struggling to absorb the skyrocketing cost of prescription drugs-drugs that were often developed with public money in the first place.
There is no good reason or justification for continuing with business as usual. We're calling for a public drug company that allows us to keep life-saving technologies developed with our dollars in the public domain-and get them into the hands of everyone who needs them.
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Several studies have found that medical marijuana has reduced opiate deaths by 25 percent while significantly curbing opiate use among Medicare patients.
While there is no silver bullet for solving an opioid epidemic that has claimed the lives of thousands of New Yorkers, the surest way to stem the tide is by preventing addiction from occurring in the first place. Fortunately, state lawmakers have a golden opportunity to begin doing this by expanding access to medical marijuana treatments that can provide patients a valuable alternative to addictive prescription drugs.
What's clear is that policymakers must be open to a range of approaches for curbing New York's escalating opioid crisis. A recent Rockefeller Institute study found opioid-related deaths are surging in New York City and across the state. From 2015 to 2016, opioid-related deaths increased by 39 percent in the city and 23 percent throughout the rest of the state, as New York's drug death rate climbed from 34th worst in the country to 27th worst. Overall, the state has seen a staggering 121 percent increase in opioid deaths since 2010.
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In response to this increasing public health crisis, lawmakers have taken several steps in recent years to try to reverse the trend. This has included more than $25 million in federal funding to expand services for those with opioid-use disorders in counties that have been hit hardest by the crisis. In February, Governor Cuomo announced $10 millionin state funding for detox withdrawal services.
While these funds are critical for helping those who have fallen victim to opioid addiction, they should be part of a multifaceted effort that includes greater access to effective treatment alternatives to opioid-based prescription drugs - a major gateway to addiction. In fact, according to the National Institute of Drug Addiction, the vast majorityof opioid deaths in the United States are linked to legally obtained prescriptions.
Medical marijuana can provide this alternative and should play a key role in New York's fight against opioid use, but it can only do so if more patients who need it can get it.
While the state's medical marijuana program launched in January 2016, access remains limited for a variety reasons. The list of eligible conditions for entering the program is restrictive, while dispensaries are still widely scattered across the state. Last year, the state took several steps to build on the program by making post-traumatic stress disorder and chronic pain eligible conditions and licensing five new companies to produce and dispense medical marijuana products.
But two pieces of proposed legislation in Albany offer lawmakers the opportunity to dramatically expand the state's program and target medical marijuana to those who are mired in opioid use and addiction. These bills would allow doctors to prescribe medical marijuana as a treatment for opioid addiction while increasing the number of dispensaries each company can operate from four to 25.
As a doctor who has helped hundreds of patients at my Manhattan and White Plains clinics apply for the state's program and find the right medical marijuana treatments, I know firsthand the role cannabis-based medicines can play in reducing the use of prescription drugs such as morphine and fentanyl. In fact, many of my patients come to me in the midst of exhaustive battles with opioid use, searching for an alternative to these powerful drugs that will help them manage their pain.
Numerous studies support the results we regularly see at my clinics. Several studies, for instance, have found that medical marijuana has reduced opiate deaths by 25 percent while significantly curbing opiate use among Medicare patients.
Of course, expanding access to medical marijuana is not a panacea for ending New York's opioid crisis. But it can offer hope for those in pain who are desperate for an alternative to the prescription drugs that have cut short too many lives throughout our state. I hope lawmakers will listen to those of us who see the potential in medical marijuana and take action that will save lives and benefit thousands of New Yorkers.
Dr. Junella Chin is a Bronx native and osteopathic physician who operates clinics in Manhattan and White Plains.
by Brian Anderson July 9, 2019 in Financial Wellness, Research/Tools, Your 401k News
The average healthy 65-year-old couple retiring this year will need $387,644 in today's dollars just to cover lifetime health care costs.
Sure hope they've been saving more in their 401k plans than the average 65-year-old couple!
A just-released white paper from HealthView Services, Why Health Needs to Be Part of Retirement Planning, provides new data detailing the projected cost of health care, the impact of health conditions, and strategies to plan for, manage, and even reduce health care costs in retirement.
Total lifetime costs that make up that $387,644 figure include premiums for Medicare Parts B and D, dental, and supplemental insurance as well as all out-of-pocket outlays for medical, dental, hearing and vision.
By TOM HARMENING
PORT CHARLOTTE - You have health insurance, life insurance, auto and home insurance.
But what about ambulance insurance?
Eyeing rising costs for both ground and air ambulance services, a handful of companies are crisscrossing Sarasota and Charlotte counties telling seniors of the benefits of being insured in case they find themselves being transported to a hospital.
Medicare and supplemental insurance plans rarely cover the entire cost of an ambulance ride and Medicare often turns down covering trips.
That has given rise to the private ambulance insurance companies.
So, over meals and pizza, the companies promise to cover the full cost of ambulance services.
Air ambulances are covered by FAA rules that block states from setting rates. So horror stories are told of 35-mile helicopter rides costing $32,000, with little of that cost covered by insurance.
Recently, at a pizza reception and seminar in Port Charlotte, 24 gathered seniors were told the primary destroyer of IRA funds are unexpected medical expenses not covered by insurance
"$40,000 and $50,000 bills for air helicopter transfers are not uncommon," Mary Plummer, a representative of MASA Medical Transport Solutions, told the audience. "There's little control on charges and often insurance claims are denied."
MASA, based in Texas, is the largest provider of medical transport insurance in the country. Under its plan, members submit the uncovered part of their ambulance charges and they are paid in full. It has been in business for 44 years.
Membership in that program runs $32.50 a month for a couple. Annual and lifetime enrollment terms are also available.
Other companies, such as AirMed, Air Ambulance Card and Medjet are also crisscrossing the area offering insurance plans. Most cater only to those over 50 years of age.
Changes are coming to Medicare because of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). First-dollar coverage for Medicare Supplement plans (also known as Medigap plans) will no longer be available to anyone new to Medicare. This will affect choices for Medicare Supplement plan availability, but that might end up being a good thing.
MACRA established three major changes to Medicare. First, providers will now be paid based on the quality of the care they provide and not just the volume. Second, it established security features that mandated Centers for Medicare and Medicaid Services (CMS) omit Social Security numbers from Medicare cards by this past April and replace those numbers with randomly generated combinations of letters and numbers to identify the beneficiaries. And third, Medigap Supplement Plans F and C will no longer be available to anyone new to Medicare as of Jan. 1, 2020.
Traditional Medicare uses letters to identify coverage: Part A for hospital expenses and Part B for medical expenses. Medicare offers great benefits; however, the downside is it only covers 80% of medical expenses after a small deductible each calendar year. The Part B annual medical deductible for this year is $185. Once the deductible is met, the retiree would be responsible for the remaining 20% without an out-of-pocket spending limit that would act as protection. Because of that, supplemental coverage can be a necessity for a retiree who has Medicare as their primary insurance.
The Medigap plan is a direct extension of Medicare and helps pay some of the deductibles and coinsurance that Medicare does not cover. Private insurance companies (including my own) offer Medigap plans, which are standardized to provide the same coverage and benefits. Each company that offers a Medigap plan charges a monthly premium that varies by company. Although there are 10 standardized plans, the most popular are Plans F, G and N.
After Jan. 1, 2020, anyone new to Medicare will not be able to purchase Plans F or C, which are the only plans that cover the Part B deductible. Congress reasoned that requiring everyone to pay at least the Part B deductible would reduce medical overuse. People currently on Medicare will be "grandfathered" in and will not be affected by these changes.
Plan F has been so popular because it pays everything Medicare-approved that Parts A and B do not cover, including the Part B deductible. Recently, Plan G, which is almost the same as Plan F, has also become popular for costs reasons. The only difference between the plans is that under Plan G the individual must pay the Part B deductible. The savings in monthly premium with Plan G make up for the difference of the deductible, causing more retirees to choose the plan. New Medicare beneficiaries might also want to look a little closer at Plan N for the same cost-saving reasons.
My healthcare insurance company sampled the last 933 individuals who purchased Plan G instead of Plan N. The average savings an individual would have seen with Plan N over Plan G was $22.49 per month (or $269.88 per year) in premiums. This might be enough for some retirees to strongly consider Plan N.
Neither Plan G nor Plan N covers the Part B deductible. Plan N has up to a $20 office copay after the Part B deductible and a copay of as much as $50 for an emergency room visit if the person is not admitted. It also does not cover Part B excess charges, which occur when a doctor, provider or supplier does not accept the Medicare-approved amount as full payment for covered services. According to CMS, a provider can only charge a maximum of 15% over the Medicare-approved amount. The downside for the provider if they do this is that Medicare will only pay them 95% of the Medicare-approved amount. However, a Kaiser Family Foundation report found that as of 2011 (the last year for which the CMS Data Compendium is available) 96% of physicians and practitioners accepted Medicare-approved amounts. So finding one who doesn't accept the Medicare-approved amount as full payment could be rare.
For beneficiaries who want a lower Medigap supplement monthly premium and are willing to agree to some cost sharing, Plan N could be a good choice. But for those who don't want to worry about possible copays or additional charges outside the Part B deductible, Plan G will continue to be a nice option. Before making any decision, though, I recommend retirees talk to an expert who can look at their specific situation, so they are better prepared for the transition into Medicare. Each person's needs are different, but the changes starting in 2020 could be positives for both retirees and the Medicare program.
The information provided here is not investment, tax or financial advice. You should consult with a licensed professional for advice concerning your specific situation.
It will be easier than ever to compare Medicare Advantage and Part D plans on Medicare.gov. For the first time in a decade, a redesigned Medicare Plan Finder will allow users to shop and compare Medicare Advantage and Part D plans. The plan finder also will allow the user to compare pricing between original Medicare, Medicare prescription drug plans, Medicare Advantage plans and Medicare supplemental insurance or Medigap policies. You are able to compare up to three drug plans or three Medicare Advantage plans side-by-side. (Medicare.gov/plan-compare)
Standard Medicare Part D prescription drug plan coverage parameters are new in 2020. Initial Deductible will increase by $20 to $435 in 2020; Initial Coverage Limit will increase to $4,020 in 2020 from $3,820 in 2019; Out-of-Pocket Threshold will increase to $6,350 in 2020 from $5,100 in 2019. Coverage Gap will begin once you reach your Medicare Part D plan's initial coverage limit of $4,020 in 2020 and will end when you spend a total of $6,350 out-of-pocket in 2020.
RELATED: South Florida Sun Sentinel's Medicare Guide for 2020 »
The 2020 Doughnut Hole Discount is more beneficial. Part D enrollees will receive a 75 percent discount on the total cost of their brand name and generic drugs purchased while in the coverage gap, which represents a change from 63 percent last year for generic drugs.
The total out-of-pocket spending required to reach the "catastrophic" coverage level in Medicare Advantage plans has increased to $6,350, up from $5,100 in 2019.
People who are newly eligible for Medicare on or after Jan. 1, 2020, will not be able to purchase Medigap Plan C or F-the two plans that cover the Part B deductible. People eligible for Medicare before that date are not affected. If you already have Plan C or F, you can keep it. And if you don't have Plan C or F but qualify by eligibility date, you can still buy those plans in the future.
RELATED: Medicare Advantage enrollment deadlines »
This is the second year for the new Medicare Advantage Open Enrollment Period. During this time period - from January to March 2020 - you are able to change your mind and switch from one Medicare Advantage plan to a different Medicare Advantage plan. You also can drop your Medicare Advantage plan and return to Original Medicare, or sign up for a stand-alone Medicare Part D prescription drug plan if you made a change that caused you to lose your prescription drug coverage.
The income brackets for Medicare Part B and D will be inflation-adjusted for the first time with high-income now starting at $87,000 for a single person, instead of $85,000.
The standard Part B premium is projected to increase to $144.30 from $135.50.
WASHINGTON - President Donald Trump intends to tout his support for Medicare and slam left-leaning Democrats on their "Medicare for All" proposal when he visits Florida on Thursday.
Administration officials say Trump plans to sign an executive order that calls for a series of changes, including a broader role for Medicare's private insurance option, as he visits The Villages, a bustling community for adults in Central Florida. That part of the state overwhelmingly supported Trump in 2016.
Medicare administrator Seema Verma said on Thursday that Trump is a "great protector of the Medicare program" and that Sanders' plan would "eviscerate" it. She called Sanders' idea not just impractical but "morally wrong," saying it would "demote American seniors to little more than second-class status."
The Sanders plan would incorporate the Medicare program, but private health insurance - including the Medicare Advantage option used by about one-third of seniors - would no longer have a role. Sanders, who unexpectedly underwent a heart procedure this week, says Medicare for All would offer seniors broader benefits and lower costs.
Sanders' style of single-payer health care has long been popular among liberals, but polling lately has shown that a majority of Democrats and independents who lean Democratic prefer expanding coverage by building on the Affordable Care Act, or "Obamacare." Trump is asking federal courts to overturn that law as unconstitutional, after a Republican-controlled Congress failed to repeal it his first year in office.
Trump's executive order does not involve a major overhaul of Medicare, which would require congressional approval. Instead, it pulls together a series of technical changes and administration priorities.
The subject of prescription drug costs also is sure to come up. Trump enthusiastically endorsed a plan by Florida's Republican Gov. Ron DeSantis to allow patients to import lower-cost medicines from abroad and is pursuing a federal version. But the impeachment inquiry has cast a cloud on prospects for major legislation to reduce drug prices.
Trump's executive order is basically a to-do list for the Department of Health and Human Services. It will require months of follow-up. Among the priorities are an expansion of telemedicine and changes to avoid overpaying for procedures just because they get done in a hospital instead of a doctor's office.
Much of the order focuses on Medicare Advantage, the private insurance option under Medicare. Medicare Advantage plans offer savings on premiums and an annual limit on out-of-pocket costs. They provide one-stop shopping, eliminating the need for separate supplemental insurance. Offered by major insurers, the plans also cover prescription drugs in most cases.
But there are trade-offs. Seniors joining a Medicare Advantage plan generally must accept limits on their choice of hospitals and doctors as well as prior insurer approval for certain procedures. If they change their minds and decide to return to traditional Medicare, they're not always guaranteed supplemental "Medigap" coverage, which is also private.
Health and Human Services Secretary Alex Azar said Trump's order directs his department to examine whether its current policies and practices put traditional Medicare ahead of the private Medicare Advantage option. Some advocates for older people say that it's the other way around and that the administration is trying to put private plans ahead.
The order also would seek to expand the range of additional services that can be offered by the private plans and would direct regulators to find more ways for seniors to financially benefit from plans that provide cost-efficient service.
Many Medicare Advantage insurers offer some dental and vision coverage, along with basics like transportation to medical appointments. But the industry lately has started to experiment with in-home assistance, including nutritious meals, and financial help with safety-related home improvements.
As a presidential candidate, Trump promised not to cut Medicare. As president, he has avoided calling for privatization of the program or raising the eligibility age beyond 65 or rolling back benefits.
However, Trump's latest budget proposed steep cuts in Medicare payments to hospitals and other service providers, prompting protests from the industry and accusations by Democrats that he was going back on his promises to seniors. The Medicare cuts have gone nowhere in Congress, as Republicans backed away from the president's budget.
Read Friday's Arkansas Democrat-Gazette for full details.