Q-C seniors in private Medicare plans face changes

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By Ed Tibbetts | Sunday, July 20, 2008 |

When Congress overrode President Bush’s veto last week and stopped a projected cut in Medicare payments to doctors, lawmakers also set in motion changes to the federally funded health insurance program that could affect thousands of Iowans.

Congress cut payments to the Medicare Advantage program, which provides government-funded health insurance to 36,000 elderly Iowans via private companies.

For years the program has been under fire because it is paid on average 12 percent more than traditional Medicare for the same service. Critics say they’re wasteful, while backers say they give seniors a choice and, often, better benefits.

Either way, Iowans who have signed up for the plans are now left to wonder what’s to happen next.

Insurance company executives say it’s too early to tell, but some beneficiaries say they aren’t very happy about the outcome.

“I don’t think it’s right. I don’t think it’s fair,” said Jane Dullard, a 67-year-old woman from Ankeny.

About 6,500 people in the Quad-Cities are enrolled in the private plans. That’s about one of every eight Medicare recipients in Scott and Rock Island counties.

Most of them are in what are called private fee for service plans.

Those plans are reimbursed handsomely by the government and many beneficiaries like them because they offer better benefits, too. And they tend not to require them to see a set list of doctors.

By 2011, according to the new law, plans in many parts of the country will be required to set up networks of providers. That includes plans in eastern Iowa, according to a map provided by America’s Health Insurance Plans, an industry group.

Setting up those networks can be expensive and some companies might not bother, the industry says.

Companies will have less than two years to put a network together, according to U.S. Sen. Chuck Grassley’s office.

A spokesman for Humana, one of the leading sellers of private fee for service plans in the Quad-Cities, says it’s too early to tell what impact the law will have.

Still, Humana has “been planning for possible changes” to Medicare Advantage and “we’ve been building Medicare networks for several years,” Jim Turner, the spokesman, said in a statement.

Roughly 75 percent of the people enrolled in private Medicare plans in the Quad-Cities are in private fee for service plans, according to government data.

Dullard says that she doesn’t want to go back to traditional Medicare. She said her new plan is cheaper and easier to use than the government program and supplemental policy she previously had.

“It’s the first time we’ve ever felt we were getting something we deserved,” she said.

Private Medicare policies have been in existence for years, but they were bolstered in 2003 when Congress revamped the program and added a prescription drug benefit.

Backers of the change, Republicans mostly, said that giving seniors more choice would be good for them and the efficiency of the program.

But critics, mostly Democrats and the commission that advises the government on Medicare issues, have recommended ending the premium payments.

They say the plans, particularly the fee for service plans that last year was paid an average 19 percent premium, aren’t being forced to operate efficiently. And, they say, it’s the government that’s subsidizing the extra benefits enrollees are getting.

Some Iowa doctors also have refused to accept private fee for service plans.

A large medical practice in Des Moines, for example, has refused.

Dr. Michael Kitchell, the president-elect of the Iowa Medical Society, said many physicians are not happy insurance companies are paid such high rates when it’s doctors that are providing a high level of coordinated care. “If we physicians are not paid for the value of our care, why are the Medicare Advantage plans receiving additional dollars,” he said.

He said physicians in the state are consistently rated highly for quality of care and that meeting performance standards is time consuming and rigorous.

There doesn’t appear to be an access problem in the Quad-Cities, though.

Genesis Health Group, a large physicians group, takes patients with such plans. And Kris Gross, director of Iowa’s Senior Health Insurance Information Program, said it’s “pockets” in northern, western and the central parts of Iowa where physicians are refusing the plans.

In vetoing the bill, Bush said seniors would lose choices and benefits with the cuts to the Medicare Advantage program.

Robert Zirkelbach, a spokesman for America’s Health Insurance Plans, an industry group, echoed those fears.

“This legislation will impact beneficiaries in a number of ways,” he said.

Ed Tibbetts can be contacted at (563) 383-2327 or etibbetts@qctimes.com. Comment on this article at qctimes.com.