Guest Contributors Paul Burke
and Jan Kletter, MD
People know that Obamacare
changed private insurance. It also changed Medicare, to save money.
Seniors with both Medicare
and private health insurance need to think about dropping Medicare Part B,
which covers doctors, outpatient procedures and equipment, but also imposes
restrictions. This is a serious decision.
Medicare is changing the way
it pays hospitals and physicians who agree to work together in alliances. These
alliances are known as accountable care organizations. Essentially the alliance
keeps half the savings when it cuts the care of Part B patients: it gets more
money for doing less. Therefore Part B patients with complex medical problems
may not get the type of care that was available in the past, and that private
insurance still covers.
Additionally, hospitals can
get hit with a penalty imposed by Medicare when patients have too many hospital
stays. Medicare rates hospitals on the number of Part B patients admitted twice
in 30 days, even if the stays are unrelated and the hospital is not at fault. Every
readmission above average, in any of six categories, incurs a penalty of
$30,000 to $265,000, far more than Medicare pays to treat a patient in the
first place. The penalties are supposed to encourage better care; the side
effect is to discourage certain hospital stays. Instead, hospitals use other
resources to keep complex Part B patients, with above-average chance of
readmission, out of hospital beds.
The American College of
Surgeons warned Medicare on June 14 about "the potential that these
hospitals will decrease their care for such patients, thereby creating an
access issue." Hospitals can afford to avoid these Part B patients,
because Obamacare sends them many new private patients. The question is whether
or not this is going to lead to better outcomes for patients.
Part B premiums cost $1,300
to $4,000 per person per year. Dropping Part B puts that money back in the
patient's pocket. It also shields patients from the new restrictions on
Medicare coverage.
According to the respected Guide to Health Plans, most federal
retirees will save money by dropping Part B and keeping their federal health
plan. "Medicare Part B will rarely save you nearly as much money as you spend
on the Part B premium... Medicare Part B is of limited value to someone already
covered by a good health plan."
Patients need to be certain
of their own situation, but many have already bypassed Part B. Skipping it
makes sense for many more, now that Medicare restrictions are in place.
Private insurers also want to
cut care; Medicare has gone further, since it has more power. To drop Part B,
patients file form 1763 with Social Security. They can re-enroll online the
first three months of each year, which would take effect in July, with a 10
percent higher premium for each year without Part B. As the Guide to Health Plans says, "Thus,
dropping Part B is not an irrevocable decision, and later rejoining Part B need
not be highly costly."
It is understandable why
Medicare has these restrictions. Seniors who get less treatment and die save
money for both Medicare and Social Security. These programs are under intense
pressure to cut costs. Patients who can pay doctors' bills with other insurance
will avoid Medicare's reductions in care by dropping Part B.
Paul Burke is a retired federal researcher who manages
a watchdog site, Globe1234.com
Jan Kletter currently practices general surgery in
West Virginia.
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