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From the category archives: Medicare

Two New Reports on Private Medicare Advantage Plans Reveal Real Problems for Seniors

 According to a new Government Accountability Office (GAO) report private insurers who offer Medicare Advantage plans need tougher oversight. 

“Federal investigators have found Medicare officials rarely enforce rules for private insurance plans intended to make sure beneficiaries will be able to see a doctor when they need care.

The U.S. Centers for Medicare and Medicaid Services, which oversees Medicare Advantage, requires the plans to have doctors in sufficient numbers and specialties who are near enough — in distance and travel time — so seniors can reach them. 

But the GAO found CMS checked the provider networks of less than 1 percent of the plans since 2013 — serving just 2 percent of Medicare Advantage members — and only when the plans expanded to a new county.” ... Kaiser Health News & Conn. Health I-Team 

In 2013, United Healthcare, which is the nation’s biggest health insurance company and a provider of private Medicare Advantage in Connecticut, dropped hundreds of health care providers and 1,200 doctors.  Medicare Advantage beneficiaries are restricted to a network of providers. If their provider leaves, they cannot change plans during the year. What happened in Connecticut is the perfect example of how MA plans have been allowed to skirt the rules, dropping providers thereby limiting coverage for seniors with little warning and leaving them with few options. 

“The GAO report shows Medicare ‘was not verifying network adequacy. That’s their job and they abdicated that responsibility,’ said U.S. Rep. Rosa DeLauro, D-New Haven, who requested the investigation along with other members of the Connecticut congressional delegation.”

Also this week, a new Brown University study shows that once medical care becomes costly for seniors in Medicare Advantage and no longer meets their needs beneficiaries are leaving the private MA plans.

"Our results raise questions about whether current Medicare Advantage regulations and payment formulas are designed to meet the needs of Medicare Advantage members who use post-acute and long-term care," wrote Momotazur Rahman, assistant professor (research) of health services, policy and practice in the Brown University School of Public Health, and colleagues in the October issue of the journal Health Affairs. "The unidirectional flow of these high-risk and often high-spending patients from Medicare Advantage to traditional Medicare appears to transfer responsibility to traditional Medicare just as patients enter a period of intensive health care needs." 

Private Medicare Advantage plans continue to see growth as they promise gym-memberships, limited optometric coverage or zero premium plans.  However, as predicted by many healthcare experts and indicated in the Brown study, seniors find that once they actually need help with more costly care, MA plans aren’t providing the coverage they need. 

Ultimately, this means that younger and healthier seniors are being lured into private insurers’ plans only to have to switch to traditional Medicare once they need coverage for more serious health issues (and isn’t that why we have health insurance in the first place – to cover when we get sick, not when we’re healthy?).  Meanwhile, private insurance companies continue to reap the benefits of annual federal subsidies to provide this limited coverage for healthier seniors – which are tax dollars that could have been used in traditional Medicare to serve all beneficiaries. 



What the GOP’s Sleight of Hand Budgeting and Deflection Politics Means for Social Security & Medicare

First pulished on Huffington Post by Max Richtman, NCPSSM President/CEO

Any good magician will tell you, the best tricks depend on misdirection. So while all eyes are on the spectacle of the House GOP’s in-fighting, its search for a new Speaker and the never-ending “who-insulted-who” shenanigans of the GOP Presidential primary, it’s easy to forget that Congress is now also quietly working on legislation that could impact virtually every American family, especially those that depend on Social Security, Medicare and Medicaid. The American people must not be distracted by the ongoing political show to the point that they miss the real action occurring behind the scenes.

Before leaving for recess in December, Congress faces legislative deadlines to avoid a government shutdown, a default, an extension for transportation funding and tax breaks. While the shutdown has been narrowly averted, the annual appropriations process continues as the President and Congressional Democrats push GOP leaders for a deal to mitigate automatic across-the-board cuts to defense and non-defense programs – also known as the “sequester.” 

No amount of political magic can hide the fact that three years of sequester caps have had serious consequences for important seniors programs, including the Older Americans Act and the Low Income Home Energy Assistance Program, along with service reductions at Social Security Administration field offices. That’s why the National Committee supports the President’s plan to increase spending caps. However, some conservatives in Congress insist that relief for programs like the Older Americans Act be paid for by cutting Medicare and Medicaid. This budgetary sleight-of-hand could trade partial relief for some seniors’ programs by cutting other essential health security programs like Medicare and Medicaid, thus further eroding the tenuous economic situation many older Americans face.

It’s no mystery where these Medicare and Medicaid cuts are likely to come from. You have to look no further than the GOP Budget plan for a blueprint of the House leadership’s favorite benefit cut proposals, such as:

  • Ending the Medicaid joint federal/state financing partnership and replacing it with fixed dollar amount block grants, giving states less money than they would receive under current law. 
  • Repealing Medicaid expansion. Since 2014, states have had the option to receive federal funding to expand Medicaid coverage. Over half of the states have expanded their Medicaid programs, and others will likely do so in the future.  Repealing this option would result in at least 14 million people losing their Medicaid coverage and state Medicaid programs would lose a total of $900 billion over 10 years. 
  • Cutting Medicare by $431 billion over ten years.  Over half of Medicare beneficiaries had incomes below $23,500 per year in 2013, and they are already paying 23 percent of their average Social Security check for Medicare cost-sharing in addition to out-of-pocket costs.

The National Committee to Preserve Social Security & Medicare has prepared a detailed look at the many policy options in our Fall Budget Outlook brief.

Legislation may need to be enacted by late November or early December to allow the government to continue borrowing and avoid a government default.  Allowing a default would result in an economic catastrophe and jeopardize the payment of Social Security, Medicare and Medicaid benefits. In addition, default would jeopardize Medicare and Medicaid payments to doctors and hospitals and coverage for prescription drugs, which are critical to the health security of millions of Americans.

As if all of this isn’t enough, funding for the nation’s roads and public transit will also expire at the end of October.  Because the Highway Trust Fund no longer takes in enough gasoline tax revenue to cover surface transportation costs, Congress must come up with more funding.  When Congress passed a temporary funding fix this summer, House leaders proposed using Social Security funds to pay for it.  This was the third time in little over a year that Congress has attempted to use Social Security and/or Medicare as an ATM to pay for a completely unrelated priority.  Last year Congress voted to extend the Medicare sequester cuts into 2024 to cover a reversal of cost-of-living cuts to veterans' pension benefits. This summer Medicare was cut again to help pay for the Trade bill.  Rather than consider tax reform for huge corporate tax dodgers sending billions of profits oversee to avoid paying taxes, GOP leaders tried again (unsuccessfully this time) to cut benefits to seniors, people with disabilities and their families who depend on Social Security to pay for highways.  Unfortunately, Congress could pull this outrageous strategy out of its hat once again.  Need money for highways, to relieve sequester cuts, deficit reduction or anything at all? Voila!  Let’s take if from Social Security and Medicare.

There’s no doubt about it -- it will take more than legislative smoke and mirrors and political magic for Congress to get the job done right. But the American people also need to be more than an audience in this process.  We need to pull back the curtain on this benefit cut agenda so the American people can avert any surprises Congressional leaders have up their sleeves for vital programs like Social Security, Medicare and Medicaid.

The GOP Debate...Slim Pickin’s If You Care About Social Security or Medicare or Virtually Any Other Issue Impacting Average Families

Now that America’s Presidential Debates are designed as entertainment television (as described here by CNN Moderator Jake Tapper) and not an actual debate of the issues voters need to hear about before choosing our next’s probably no surprise that Social Security & Medicare just aren’t considered sexy enough for any serious attention. 

In response to the only question asked last night about the nation’s most successful government programs, Donald Trump told the audience he’ll give up his benefits because he doesn’t need them (Ben Carson made the same suggestion earlier in the week).  So, you have to wonder -- is asking rich people to voluntarily give up their Social Security and Medicare now considered a serious GOP policy plan? Maybe every American millionaire will be asked to email 10 of their country club friends to pledge to give up their benefits, too?  No one is forced to apply for their Social Security now, so how is this even vaguely a solution? 

Meanwhile, since Governor Chris Christie staked his campaign on the idea of being tough on “entitlements” he continued to push his plan to slash benefits by ignoring actuarial reports from every legitimate government entity including the Congressional Budget Office and the Social Security actuary. Christie claimed last night that Social Security will be insolvent in just “7 to 8 years.”

The truth is the Social Security Trust fund will be depleted in two decades and only pay 79% at that point, if Congress does absolutely nothing.  But that’s not the same as Social Security is “broke” and Social Security is “insolvent.”  At the bare minimum, a President of the United States needs to understand the difference. 

Finally, while this didn’t happen in last night’s debate, Carly Fiorina recently offered a truly unique approach to her plans for Social Security and Medicare as’s a secret until I’m in the White House. 

"I am not prepared to go to the American people and talk to them about how we're going to reform Social Security and Medicare,’ Fiorina told CNBC's John Harwood in an interview published Wednesday, ‘until I can demonstrate to them that the government can execute with excellence, perform its responsibilities with excellence, serve the people who pay for it with excellence.’

Harwood was impressed. ‘That is a dodge worthy of a very good politician,’ he told the former Hewlett-Packard CEO. 

Fiorina denied that she had just dodged. ‘I am deadly serious,’ she said.” 

No doubt she’s deadly serious about not addressing the issue now or talking about her already expressed plans to cut Social Security offered during the California Senate campaign in 2010:

"I'm prepared to look at any and all ideas without stating at this point which I would favor and which I would not. We have to have a comprehensive look at entitlement reform, including Social Security reform."  Carly Fiorina, 2010

“... I believe that to deal with entitlement reform, which we must deal with, we ought to put every possible solution up on the table...”  Carly Fiorina, Fox News 2010

So basically, once President Fiorina is confident she’s an excellent President then she’ll tell you about her plans to cut Social Security and Medicare benefits. 

But only then...

Populism, Promises and Privatization: Mike Huckabee and Social Security

Former Governor and GOP Presidential hopeful, Mike Huckabee, found out early in the primary race a populist tone combined with a promise not to cut Social Security and Medicare benefits would provide a political opportunity to distinguish himself from the GOP pack who’ve been racing to see who could cut more middle-class benefits faster.

Unfortunately, Huckabee’s Oped in the DesMoines Register today made it abundantly clear that, in spite of his rhetoric, his actually plans for the programs are just more of the same: repeal Obamacare and the billions in benefits and years of solvency that comes with it, privatize the programs, and replace Social Security’s funding with a regressive tax changing the program from an earned benefit into a welfare program.

You have to ask yourself, is this really how a champion of Social Security and Medicare describes these programs?

“Washington confiscates money from every American’s paycheck”

“The government grabs that money”

“Washington has been pick-pocketing us every day of our working lives.”

“Washington put a gun to your head and robbed it from your paycheck.”

NCPSSM President/CEO, Max Richtman reacted to Huckabee’s piece this way:

“While it’s encouraging to see one GOP presidential candidate finally acknowledge that Social Security and Medicare benefits should not be cut (“Don’t Cut Benefits America’s Seniors already paid for” Aug 12, 2015), it’s also clear Governor Huckabee’s reasoning is built on a flawed political premise that Social Security and Medicare were built through federal ‘confiscation’ and ‘pick-pocketing.’

No doubt, this plays well with the candidate’s Tea Party base, especially those who are conflicted in their hatred of government and love for its two largest programs, Social Security and Medicare.  However, it’s clear Huckabee’s views have far more in common with the GOP Presidential pack than the American people who value these programs in their current form, not the privatized preference he supports.  Taxing “illegals, prostitutes, pimps, drug dealers,” to pay for Social Security doesn’t seriously address income adequacy or long-term solvency while repealing Obamacare would steal years of solvency from Medicare and billions in new benefits for seniors. 

The American people, of all ages and parties, support Social Security and Medicare because they work.  Promising to protect benefits, while maligning the very essence of these programs and supporting the same old GOP prescriptions may be a good political strategy but it has little to do with improving the programs for generations of Americans.”...Max Richtman, NCPSSM President/CEO

Not mentioned in his Des Moines Register piece, and only rarely discussed, is the fact the Huckabee also supports various forms of privatization ranging from ending Social Security’s guaranteed monthly benefit in exchange for a lump-sum payment to private accounts for future generations. 

“Instead of signing up for Social Security sometime between the ages of 62 and 70, which is currently the only option for eligible Americans, and receiving a monthly benefits check, Huckabee wants to offer a one-time, lump-sum cash out benefit at age 65 to participants that would be completely free of taxation. Per Huckabee, it would remove the government's ongoing involvement in providing for seniors, and it would potentially allow seniors the opportunity to invest their lump-sum payment in order to achieve inflation-topping returns.”  Motley Fool

Sound familiar?  It should, as it’s the same send-your-Social-Security-to-Wall-Street goal expressed by President George Bush during his failed campaign a decade ago to privatize Social Security – delivered in a slightly different way.  Apparently everything old is new again.

Huckabee also uses Social Security and Medicare, based on his misdiagnosis of the long-term solvency issue, to defend a terribly regressive tax policy -- the Fair Tax -- which rewards the rich and punishes everyone else: 

“Citizens for Tax Justice and the congressional Joint Committee on Taxation have each found that to raise the same amount of revenue as current law, the sales tax rate would have to be about 50 percent.

A study by the Institute on Taxation and Economic Policy (ITEP) found that under the “Fair Tax,” the top 1 percent of taxpayers would receive an average annual tax cut of $225,000. Meanwhile, the plan would increase taxes by about $3,200 on average on the bottom 80 percent of taxpayers. In other words, Huckabee’s tax plan would significantly increase taxes on the overwhelming majority of Americans to pay for huge tax cuts for the very wealthiest Americans.”

Time will tell if seniors will take the “I won’t cut your benefits” bait and ignore the details of Governor Huckabee’s plans for Social Security and Medicare.  As is always the case in every political campaign, the devil is in those details.  

The GOP Debate Watchers Guide on Social Security & Medicare

Busting Tonight’s Top 5 GOP Myths – In Advance

You don’t have to be much of a political sooth-sayer to predict that, given the GOP rush to attack what the party calls “entitlements” (and what everyone else knows are actually earned benefits), tonight’s debate will likely touch on the GOP Presidential candidates’ plans for Social Security and Medicare. 

Unfortunately, since this debate is being moderated by Fox News that discussion will start from the flawed premise that these programs are “bankrupt,” destroying America’s economy and simply too expensive.  It’s likely to go downhill from there as the GOP Presidential contenders have already tried to prove their conservative bona-fides by out tough-talking each other in a rush to cut benefits more than the guys standing next to them.  (So far, Mike Huckabee has been the exception to that rule so it will be interesting to see what tonight brings from him.)

As you watch tonight, remember these basic truths:   

1.  Social Security and Medicare Are NOT Bankrupt and not in Crisis

Medicare solvency remains greatly improved since passage of health care reform with the Hospital Trust Fund paying full benefits until 2030 which is the same as was projected last year. In 2030, payroll taxes alone are estimated to be sufficient to cover 86 percent of HI costs. Solvency has improved by 13 years from the date that was projected before enactment of the Affordable Care Act. In fact, Medicare's actuarial shortfall actually decreased from last year. 

Social Security remains well-funded. With the economy in recovery, Social Security's total income will exceed its expenses by over $9.2 billion and annual income will exceed obligations through 2019. There is nearly $2.79 trillion in the Social Security Trust Fund, which is $25 billion more than last year and it will continue to grow by payroll contributions, income taxes paid on benefits, and interest on the Trust Fund's assets.

Even if Congress does nothing, and no one believes that will happen, Social Security and Medicare are still not “bankrupt.” The programs will pay reduced benefits once their Trust Fund reserves are depleted.  However, a 14% Medicare benefit cut in 2030 and a 21% Social Security cut in 2034 are not options. That’s why we urge Congress to set aside the crisis rhetoric and focus its attention on benefit adequacy and long-term solvency as proposed in the Social Security 2100 Act

2.  Disability “Crisis” Can be Easily Avoided

Congress has known since 1994 that the Disability Trust Fund would be depleted in 2016, meaning only 81 percent of scheduled benefits will be payable after that point. Rather than make a routine administrative reallocation of income across the Social Security Trust Funds, as Congress has done 11 times before (including 4 times during the Reagan administration), the GOP House has blocked that move.  Conservatives say they will wait until the 11th hour to force broader changes in the Social Security program, rather than simply fix the issue easily today. So if you hear any hand-wringing tonight about the disability “crisis” from Presidential candidates tonight, understand this is a “crisis” of the GOP Congressional leadership’s making.  Also, a subset of this discussion is the myth that the disability program’s solvency issues are due to lazy Americans who are scamming the system.  The truth is disability expenditures have increased primarily due to anticipated demographic trends - as the large number of baby boomers age into the disability-prone years (they turned ages 50 to 68 in 2014), more people become disabled and thus receive benefits.  The increase in full retirement age from 65 to 66 (and to 67 for those born after 1959) has also contributed to the increase in disability expenditures, as people remain on the disability rolls longer before shifting to retirement. Also, it’s not easy to get disability.  80% of initial disability claims are denied.

3. No One Suggests “Doing Nothing”

Claims that supporters of Social Security & Medicare want to “do nothing” is an absurd straw-man argument designed to hide the real truth that conservatives have long supported a cuts-only approach to addressing long-term solvency with little regard to what those cuts actually mean to American families.  From President Bush’s failed privatization campaign to the GOP Budget and many other harmful proposals in between, ensuring that Social Security and Medicare benefits remain adequate for millions of Americans is not the primary goal.  The #1 goal is to cut benefits.  Rather than address the many solvency proposals which don’t rely solely on benefit cuts, GOP candidates have chosen to pretend these plans simply don’t exist, thus the “do nothing” straw-man argument.

4.   Slashing Benefits Isn’t the Only Way to “Save” Social Security and Medicare

When a candidate promises to “save these programs for future generations” by raising the retirement age, raising the Medicare eligibility age, privatizing Social Security, changing the COLA formula and means-testing Social Security while exempting near retirees what they’re actually saying is:  “We know seniors vote so we’ll protect them now and slash future benefits for their children and grandchildren instead.”  This cynical GOP messaging strategy isn’t new.  But it ignores the fact that seniors understand the recession generation will need Social Security and Medicare, particularly as they face high unemployment, wage stagnation and historically high student loan rates.

What You Won't Hear Tonight

Here are a few examples of proposals you won’t hear about tonight: lift the Social Security payroll tax cap so that the wealthy pay their share, allow Medicare to negotiate for prescription drugs in Part D, reinstitute Part D drug rebates from pharmaceutical manufacturers and allow billions in Medicare Advantage overpayments to private insurers to be fully phased out as provided in the ACA.  You can be sure none of these proposals will be offered by GOP Presidential candidates tonight, even though they would save billions and spare current and future retirees, survivors and the disabled from devastating benefit cuts. Poll after poll shows the American people of all ages and political parties oppose cutting benefits in Social Security and Medicare.  They’re also willing to pay more to strengthen the program for future generations.  But you won’t hear that tonight either.

America is the wealthiest nation in the world at the wealthiest point in our history, yet rather than focus on growing income inequality, wage stagnation and the death of the middle-class, conservatives hope to shift voters’ attention away from the true causes of our economic malaise in favor of cutting benefits for “greedy geezers” and “takers” who receive Social Security and Medicare, all the while promising to strengthen the programs by slashing them.

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