Medicare Advantage is not the answer for Delaware's pensioners. This is why | Opinion

Health care is complicated. In America, unlike anywhere else, our health care is built on a free-market economy. It operates on competition, and for competition to exist, people must have a choice, which makes our health care system pluralistic. This means you have a choice in the doctor and hospital you need. Medicare plans are a good example of choice. Medicare health plan decisions affect how much you pay for coverage, what services you get, what doctors and hospitals you can use, what medications are covered, and your overall quality of care. For all these reasons, selecting a Medicare plan is a very individual decision. Delaware State Pensioners have a choice with Medicfill, a regular Medicare insurance program — a choice without any delays from preauthorization and a choice of doctors or hospitals that best fits their needs.

But last year, the state decided to mandate a change from Medicfill, a Medicare health plan, to Medicare Advantage, a privatized health plan. The move was not transparent, nor did the state follow their administrative procedures.

One can only imagine that Claire DeMatteis, Secretary of Human Resources, and the State Employee Benefits Committee were single-minded in negotiating with insurance companies only to obtain an alternative health plan that substantially reduced the state's unfunded liability. If this were the objective, their solution would be acceptable, but the genuine concern is about pensioners' health, which the state shares responsibility for ensuring. Pensioners have had a long-standing "customary health insurance" through a Medicare plan that allowed choice, and the state has known from day one its financial responsibility.

The fact remains there are substantial differences between Medicare and Medicare Advantage. A growing body of evidence has demonstrated significant concerns over the focus of Medicare Advantage plans. Since MA started in 1997, it has not provided evidence of improved quality or lower cost compared to similar Medicare plans. But what it has shown through this opportunity is a higher profit margin. Nearly every major insurance company has been accused of or settle allegations of Medicare Advantage fraud. They are abusing the program by making the patient appear sicker than they are to obtain higher reimbursement from the Medicare Trust Fund.

Here are some of the facts to back this up:

• Judith Stein, executive director of the Center for Medicare Advocacy, stated, "Not only are wasteful payments to private Medicare Advantage plans straining Medicare finances, but they are also crowding out expansion of benefits for the half of Medicare beneficiaries who choose to remain in traditional Medicare."

• The Alliance for Health Policy reported that in 2020 Medicare Advantage billed the Medicare Trust Fund 9.5% higher than equal billing by regular Medicare. The Center for Medicare and Medicaid Services performed a code adjustment to bring MA risk score down to 3.6% resulting in a $12 billion excess payment from the Medicare Trust Fund. This is important because the Medicare Trust Fund has already projected that it will only be able to fund 91% of part A payments by 2026. CMS is looking into additional changes to risk adjustment rules for Medicare Advantage.

• Kaiser Health News reported that Medicare Advantage plans overbilled the federal government by millions between 2011-2013, with some plans overbilling an average of more than $1,000 per patient per year.

• CMS has informed Medicare Advantage their marketing T.V. advertisement practices must be approved by CMS first to prevent additional false advertisements.

• Kaiser Health News reports that Medicare Advantage plans are sending enrollees home from skilled nursing and rehabilitation centers to increase their profit before they are healthy enough to leave.

• In Washington, Congress passed H.R. 3173 Improving Seniors Timely Access to Care Act of 2021, mandating Medicare Advantage plans to report to CMS the extent of their use of prior authorization and rate of approval or denials.

• In February this year, over 70 members of Congress signed a letter to The Honorable President Joseph R. Biden and the Honorable Xavier Becerra, Secretary US Department of Health and Human Services, requesting reform to all Medicare Advantage Plans. Specifically, they requested:

  • Finalize and enforce the proposed rule on prior authorization in the MA plan

  • Require MA plans to cover services from any medical provider that accepts Medicare's approved rate

  • Stop overpayments by developing a more accurate risk-scoring model and prohibiting unscrupulous methods of increasing care costs

  • Reinvest the $46.5 billion annual savings from MA profiteering into improvements to traditional Medicare

Medical insurance companies that issue Medicare Advantage plans have done nothing more than increase their profits, and Delaware should not use pensioners as profit pawns for their continued effort. There is hope that the Retiree Healthcare Benefits Advisory Subcommittee can change the direction and recommend an alternative focused on value that will reduce cost and increase quality that will include everyone. Cost is a significant concern for all participants in health care. It is a well-known fact that our health care system is well over double the cost of any other health care system in the world. The need to reduce costs is urgent. When approved, Medicare Advantage was supposed to reduce costs, but surely it has not.

Over the past few years, CMS has been working through accountable care initiatives with hospitals and doctors not just to bring the cost down but equally as essential to bring the quality up. This year they are announcing innovative initiatives in regular Medicare that will provide real health care value or higher quality at a lower cost. Unlike Medicare Advantage, CMS and traditional Medicare plans work directly with hospitals and doctors to create value. The difference is that CMS brings healthcare providers together in one payment directly rather than a payment to an insurance company that contracts with providers.   Delaware should take time and effort to go back to regular Medicare and work with pensioners without the focus of privatizing health insurance.

Ray Seigfried is a former state represtentative.

This article originally appeared on Delaware News Journal: Delaware pensioners Medicare Advantage