That's the suggestion made by Senate Finance Committee Chairman Max Baucus and echoed by panelists at the first of the committee's health care roundtable meetings.  The Associated Press and Maggie Mahar provide the best reviews of this first Senate session, which focused on reimbursement and delivery reform.  Baucus told attendees: 

"Medicare is the big driver here" and "How to scale it up" will be one of the key questions, he said, but "Medicare will be a big part of that solution."  

His written statement also said: 

"The U.S. health system scores 65 out of 100 on indicators of health outcomes, quality, access, equity, and efficiency. And we know from previous research that adults receive recommended care only about half of the time. [And these are adults who have access to care.] We have the opportunity to modernize our outdated payment systems. Those payment systems encourage the delivery of more care, rather than better care."

The National Committee applauds the Senate's efforts to ensure Medicare is more than just the piggy bank used to pay for system wide health care reform.  Eliminating wasteful industry subsidies to private insurers in Medicare Advantage makes good sense but some of that money must also be reinvested back into improvements for Medicare to:

• lower drug prices through government negotiation
• close the prescription drug doughnut hole
• limit seniors' out-of-pocket costs

Medicare's actuaries predict over one-half of the average senior's Social Security benefit check will be consumed by Medicare out-of-pocket costs by 2025. Containing health care costs is an important goal of national health care reform and we believe seniors in Medicare have a large stake in that ongoing debate.

For years, the health insurance industry, led by AHIP, has tried to foment a senior revolt to head off any attempts in Washington to trim back billions in outrageous industry Medicare Advantage subsidies provided by the Bush administration.  AHIP created its own "grassroots" group,  "The Coalition for Medicare Choice" offering free lunches and door prizes at "community meetings" designed to convince seniors that Congress wants to "take away your Medicare".   Now it appears this Astroturf lobbying campaign has reached a new low...sending letters to the editor from seniors without their knowledge.  The New Bedford Eagle-Tribune in Massachusetts reports on three fake letters it received: 

"Some of those seniors are unaware that they have sent any such letters to newspapers. Some of them hadn't even heard of Medicare Advantage. ‘I did not write a letter to the editor. It's not from me,' said Gloria Gosselin, 75, of Lawrence.  Gosselin's name was on one of three strikingly similar letters touting the Medicare Advantage program that were sent to The Eagle-Tribune. Writers of letters to the editor are routinely contacted by newspapers to make sure letters are legitimate. In this case, they weren't. All three of the purported authors of the letters said they had no idea their names were being used to advocate for the health insurance program. The letters were, in fact, composed and sent by the Boston office of a national political consulting firm attempting to create the appearance of a ‘grass-roots' movement for Medicare Advantage."

A quick Google search shows a number of similar letters did make it to print in papers nationwide, large and small.  How many are real?  Who knows.  But when you look at the history of Medicare Advantage's creation, its marketing abuses, rising premiums and out of pocket costs, this Astroturf campaign can't be too surprising from an industry pulling out all the stops to preserve it's profitable government subsidies.  The Obama administration is right to go after these outrageous industry overpayments which will cost Medicare$150 billion over ten years, shave almost two years from Medicare's solvency, and force all beneficiaries (not just those enrolled in MA plans) to pay $36 per year in higher premiums.  These subsidies should be repealed and the savings reinvested in traditional Medicare to improve coverage for 44 million Americans.  That's a true grassroots effort that seniors have supported and will continue to support without free meals, fake letters and Astroturf campaigns.

CMS has given private insurers offering Medicare Advantage and Part D plans guidelines on what will be required to offer coverage to seniors next year. The requirements issued by CMS today are part of the annual Call Letter which is issued to organizations that intend to offer Medicare Advantage and Prescription Drug plans in 2010.  These organizations use this guidance to prepare bids which will be submitted on June 1 and helps to ensure that beneficiaries have the information they need to choose the best plan for them during the annual enrollment period which begins Nov. 15, 2009.  More than 10 million beneficiaries are enrolled in Medicare Advantage plans and more than 17 million are enrolled in Part D prescription drug plans.  Medicare officials said the changes include winnowing the number of versions of a plan that insurers can offer, protecting patients with chronic diseases from excessive co-payments, and banning a practice by some plans that can add even more to the costs of brand name drugs. Specifically CMS will:

• Take new steps in its review of Medicare Advantage plan cost-sharing to ensure that sicker beneficiaries will be protected from discriminatory out-of-pocket charges for the health care services they need.For example, CMS will be reviewing plan benefits to ensure that cost-sharing for such services as renal dialysis, Part B drugs or home health or skilled nursing services is not higher than the cost sharing amounts under Original Medicare.

• Ban a practice that some prescription drug plans use to increase patients' costs for brand name drugs. Along with a higher copayment for the brand medication, these plans also tack on the difference between the cost of the brand drug and a generic version. CMS will also require Part D plans to provide additional and easy to understand information about coverage in the doughnut hole, including how the plan will cover both brand and generic drugs in the gap. That information will be available on the Medicare Prescription Drug Plan Finder Web site later this fall.

• Closely scrutinize the private plans' bids for 2010 to eliminate MA plans which don't differ significantly from their basic plans. By eliminating these plans, CMS hopes beneficiaries should then be easily able to see differences in the types of plans offered, including clear differences in the benefits offered through each different plan or differences in other plan features, such as the same formulary or similar out-of-pocket costs. Officials said the reduction in the number of Medicare plans is meant to cut down confusion, not reduce choice.

Each of these reforms are desperately needed and we applaud CMS for working to make Medicare Advantage more responsive to seniors needs.  Clearly, there's new management in town and that's a good thing for Medicare, seniors and taxpayers.

President Obama’s Budget is now available online.  

There was a good bit of early discussion  this morning based on background briefings provided by the White House last night.  ABC had an early summary of the Medicare related provisions included in the HHS portion of the budget.

  The 10 year  savings (detailed in Summary Table S-6) are:   

• $8.1 billion in savings by means-testing Part D...in other words, raising  premium costs for higher income seniors 
•  $177 billion in savings by reducing wasteful overpayments to private insurers in the Medicare Advantage program by establishing competitive bidding 
• $260 million to ensure that Medicare makes appropriate payments for imaging services through the use of radiology benefit managers. 
•  $37 billion by basing Medicare home health payments  on actual costs. 
•  $23.9 billion reallocation of Medicare and Medicaid Improvement funds 
•  $19.6 billion saved by requiring drug makers to increase the rebates on drugs sold to Medicaid and Medicare/Medicaid “dual eligible” beneficiaries from 15% to 21%  
•   $17.8 billion Medicare hospital payments reduction by bundling inpatient  and outpatient reimbursement to include 30-days after discharge. 

 On the expense side in Medicare, this budget proposes:

• New efforts to allow Americans to buy prescription drugs from other countries 
•  Health IT and treatment effectiveness research in Medicare, including new demonstration projects to evaluate payment reforms

  For Social Security the 2010 Budget proposal includes:

• 10% funding increase to target disability claim backlogs. This  amount includes resources to ensure increased staffing in 2010 and will allow SSA to increase the level of work processed
• $759 million for SSA program integrity.  This would reverse a decline in funding seen over recent years to ensure benefits are paid only to those eligible and in correct amounts. 

The 2010 Budget also includes Retirement Account/Savings Provisions which: 

• Lay the groundwork for future establishment of a system of automatic workplace pensions, to operate along side Social Security. Under this proposal, employees would be automatically enrolled in workplace pension plans. In cases where employers do not now offer a retirement plan, they would be required to enroll their employees in a direct-deposit IRA account that is compatible with existing direct-deposit payroll systems. Employees may opt out if they choose.

Everyone in Washington is playing the name game these days as nominations for key positions in the Obama administration are announced.  We're watching and listening especially closely for the nominee to head the Centers for Medicare and Medicaid Services (CMS). According to the Washington Post The incoming secretary of health and human services, Tom Daschle, is busy assembling his team.    We've worked closely with many of the people reported to be on the Obama/Daschle short list for CMS Director.  But let's just set aside the names for a minute and talk about what we believe a new CMS Director should bring to the job. 

1. An understanding and commitment to traditional Medicare.  Throughout the Bush administration the emphasis has been on advancing private plans to the detriment of the Medicare program overall.  CMS must return to its original goal of providing reliable health insurance for seniors not profits for private insurers.
2. A willingness to mandate more stringent management of Part D and MA plans, greater transparency in plan performance and better use of grievance and appeal data to manage contracts with private plans.  
3. Budget and political experience necessary to manage the fiscal needs of an agency that has been underfunded and whose mission has been misdirected by the Bush administration. 

We must not forget that Medicare pays one-fifth of our nation's health bill.  That's just one reason why the new Congress and the new Administration are likely to enact Medicare legislation and health care reform that will affect Medicare.  Here are our priorities as that debate unfolds: 

1. Eliminate wasteful subsidies to Medicare Advantage plans
2. Create a prescription drug program in traditional Medicare with government negotiation of drug prices.
3. Eliminate means-tested Part B premiums to keep Medicare affordable for all
4. Pass nationwide health care reform, reducing Medicare's costs for beneficiaries and the government

It appears the folly of wasting billions on industry subsidies to inefficient private Medicare Advantage plans has finally become too hard to ignore.  Just this week alone there have been two more Editorials urging the elimination of these outrageous giveaways, one in the Baltimore Sun and this in the New York Times.