Key components of Medicare bill...from Forbes this afternoon...
Reuters, 11.22.03, 5:04 PM ET
forbes.com
WASHINGTON, Nov 22 (Reuters) - The U.S. House passed and the Senate is now debating a $395 billion 10-year Medicare prescription drug bill that also contains reforms to expand private health plan participation in Medicare. Here are some of the key provisions:
DRUG BENEFIT - Starting in 2006, seniors would buy new "drugs only" policies from private insurers. The government would pay three-quarters of the cost up to $2250 a year, after the beneficiary pays a $250 deductible and a monthly premium of about $35. Then there is a coverage gap, sometimes called a "doughnut" until the beneficiary has spent $3600 of out pocket, after which the government picks up 95 percent of "catastrophic" costs. Poor people would get additional subsidies.
Seniors could also get all their health care including drugs from managed care plans.
PRIVATE PLANS AND STABILIZATION FUND - Payment increases to entice more private managed care networks, particularly preferred provider organizations, to enter Medicare. It includes a $12 billion stabilization fund to help private plans transition into and stay in Medicare. Earlier efforts to expand Medicare managed care, particularly in rural areas, have stumbled.
PREMIUM SUPPORT - A controversial six-year pilot project to require Medicare to compete directly against private plans in six areas.
Premiums for people who choose to stay in traditional managed care would not be able to change more than five percent a year because of the pilot program. Poor people would have extra protections.
Many Democrats object to premium support, saying it is the first phase of Medicare's dismantling. They say it will force some six million seniors into managed care.
COST CONTAINMENT - Congress would have to act on presidential recommendations if Medicare got 45 percent of its funding from general treasury revenues, as opposed to Medicare payroll taxes, premium payments or other sources.
Backers of that provision say it will help keep Medicare solvent. Critics say it changes the fundamental meaning of government health insurance.
MEANS TESTING - Wealthier Americans would have to pay more for "Medicare Part B," which covers doctors. Lawmakers said the means tests, sometimes called income relating, would start for individuals with $80,000 annual income.
HEALTH SAVINGS ACCOUNTS - The bill adopts a $6.8 billion House provision lifting existing restrictions on tax-sheltered health savings accounts and makes them available to all Americans, not just in Medicare.
RETIREES - Includes incentives for employers to keep offering retiree health benefits. Gives businesses tax free subsidies if they offer drug benefits equivalent to the Medicare package. They would get a 28 percent payment for drug costs between $250 and $5,000.
HEALTH CARE PROVIDERS - The bill would reverse a planned 4.5 pay cut to Medicare doctors in fiscal 2004 and instead give a 1.5 percent increase in 2004 and 2005.
Hospitals would not get any fee cuts in fiscal 2004 and would be protected from cuts in the next three years if they submit quality data to the agency that runs Medicare.
Rural hospitals would get roughly $25 billion to help even out geographic disparities in payment formulas.
DRUG REIMPORTATION - The bill orders a study of whether cheaper drugs can safely be reimported from Canada.
GENERIC DRUGS - Reforms drug patent laws to make it easier for generic drugs to compete against brand names.
Copyright 2003, Reuters News Service |
