Fwd: Issue 24, November 25, 2008

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Welcome to MEDICARE WATCH, a biweekly electronic newsletter of the

Medicare Rights Center

Vol. 11 , No. 24 : Novemeber 25, 2008

Contents:

1. FAST FACT

2. COALITION URGES ELIMINATION OF MEDICARE TWO-YEAR WAITING PERIOD

3. BAUCUS RELEASES HEALTH CARE REFORM WHITE PAPER

4. AARP INVESTIGATES ITS HEALTH INSURANCE OFFERINGS

5. CASE FLASH: APPEALING A SNF TERMINATION OF CARE IN A MEDICARE

PRIVATE HEALTH PLAN

1. FAST FACT

Medicare private health plans (also known as “Medicare Advantageâ€

plans) received $6.8 billion in improper payments in 2006, primarily from

plans’ errors in documenting their enrollees’ diagnoses. The improper

payments are equal to 10.6 percent of total payments to Medicare

Advantage plans for the year. (Centers for Medicare & Medicaid

Services,

CMS Issues Improper Payment Rates for Medicare, Medicaid, and SCHIP,

November 2008)

2. COALITION URGES ELIMINATION OF MEDICARE TWO-YEAR WAITING PERIOD

Over 75 health advocacy organizations this month launched the Coalition

to End the Two-Year Wait for Medicare, sending a letter to health leaders

in the House and Senate demanding that next year’s health reform

efforts make a priority of covering people with disabilities who are

struggling to survive as they wait for Medicare coverage.

Close to 1.5 million people are stuck in this waiting period annually.

â€Nearly 40 percent of these individuals are without health insurance

coverage at some point during their wait for Medicare; 24 percent have no

health insurance during this entire period. Many cannot afford to pay

COBRA premiums to maintain coverage from their former employer, and

private coverage on the individual market is unavailable or too expensive

for this high-cost population. The economic downturn makes it difficult

for states to extend Medicaid coverage beyond the most impoverished

people with disabilities,†the coalition letter reads. “No one with

disabilities severe enough to qualify for SSDI should be without health

insurance.†The coalition includes organizations such as the American

Cancer Society –“ Cancer Action Network, Amputee Coalition of America,

Alzheimer’s Association, Easter Seals and the Medicare Rights Center.

In 1972, when Congress expanded Medicare to include people with

disabilities, it created a “waiting period†that requires people to

wait 24 months from when they begin receiving their Social Security

Disability Insurance (SSDI) payments before they can receive health care

through Medicare.

Costs for the elimination of the waiting period are estimated to be

around $9 billion annually. These costs would be offset by about $4

billion in Medicaid savings.

In the Senate, S.2102 is sponsored by Senator Jeff Bingaman (D-NM), and

cosponsored by 23 senators, including President-elect Barack Obama. In

the House, H.R. 154, sponsored by Representative Gene Green (D-TX) has

103 cosponsors. This legislation would eliminate the waiting period

through a ten-year phase out.

3. BAUCUS RELEASES HEALTH CARE REFORM WHITE PAPER

Senator Max Baucus, Democrat of Montana and chairman of the Senate

Finance Committee, outlined an agenda for health care reform that builds

on existing private and government-funded sources of coverage, requires

all individuals to buy insurance and prohibits insurance companies from

denying coverage to people with pre-existing conditions.

The Baucus plan would eventually ensure that every individual has access

to affordable coverage by creating a nationwide insurance pool. Those who

already have insurance can keep what they have, but for people who need

access to guaranteed, affordable coverage this would allow people to

easily compare plans before purchasing one. Private insurance companies

would not be allowed to discriminate against people with pre-existing

conditions.

In the short term, Baucus would provide individuals who are 55 and older

an option to buy into the Medicare program. Medicare would charge

enrollees electing the buy-in option an annual premium that is calculated

to keep the total costs budget-neutral. Therefore the Medicare buy-in

option would not increase costs for Medicare or the taxpayers. By

providing coverage to a population that is without health care during the

ten years before they become eligible for Medicare, the Medicare program

might benefit from cost savings through prevention efforts, according to

the Baucus plan.

In addition to expanding coverage to those 55-64, the Baucus plan would

also begin the phase-out of the two-year waiting period for Medicare

coverage for people with disabilities. The current Medicare policy

requires people to wait 24 months from when they begin receiving their

SSDI payments. It is estimated that around 400,000 people are without

insurance during this waiting period, and many more are underinsured. The

Baucus plan anticipates that with more access to affordable coverage,

those with disabilities would eventually be able to buy insurance on the

private market as well.

Currently, Federal law does not require states to cover all adults under

Medicaid unless they are disabled, elderly, or pregnant. The Baucus plan

also calls for expanding eligibility to Medicaid to everyone living below

the poverty level and expanding eligibility for the State Children’s

Health Insurance Program to more middle-income families without

coverage.

4. AARP INVESTIGATES ITS HEALTH INSURANCE OFFERINGS

AARP launched an investigation into its “supplemental indemnity

plans,†plans that cap what the insurer pays for services but not what

policyholders might owe. While the marketing materials for these plans

imply they provide full insurance coverage, the plans are actually

designed to be used in conjunction with other insurance and provide no

limits to an enrollee’s out-of-pocket health care costs.

AARP took action in response to Ranking Member of the Senate Finance

Committee, Senator Grassley’s concerns about the quality of

coverage provided by supplemental indemnity plans.

Senator Grassley’s inquiry began after testimony by before

the Senate Finance Committee last June. , an enrollee in AARP’s

Medical Advantage Plan, one of the supplemental indemnity plans in

question, testified that she was shocked when the doctor providing

treatment for her leukemia demanded $45,000 up front because her health

care plan did not cover the cost of the service. ’s AARP plan paid

a flat amount to enrollees for out-of-pocket health care costs, rather

then covering a percentage or portion of the cost of medical services.

In early November, Senator Grassley sent a letter to AARP criticizing

these plans for providing enrollees with little or no financial

protection against catastrophic medical costs.

Additionally, in his November letter, Senator Grassley stated that his

staff found AARP marketed and sold supplemental indemnity plans to people

with Medicare, including people who already had supplemental Medicare

coverage. The marketing of these plans to people with Medicare occurred

even though AARP advertised the supplemental indemnity plans as a

“bridge†to Medicare for retired people under 65.

“The pitch for these products should be straight up and informative,

instead of designed to leave the impression of being comprehensive when

the product is, in fact, very limited and leaves consumers seriously in

debt if they need intensive medical care,†Senator Grassley said in a

November 3 press release.

AARP responded to Grassley’s letter by suspending the sales and

marketing of these plans, which are provided through United Healthcare

under the AARP brand. More than one million people have bought this type

of coverage, according to the New York Times.

5. CASE FLASH: APPEALING A SNF TERMINATION OF CARE IN A MEDICARE PRIVATE

HEALTH

PLAN

Mrs. B and her husband, Mr. B, are both enrolled in a Medicare private

health plan. Last month, Mr. B had invasive surgery that made it very

difficult for him to walk. He then entered a skilled nursing facility

(SNF) for physical therapy to help him regain his strength. A few weeks

later, Mr. B’s therapist told Mrs. B that because her husband’s

progress had “plateaued†and he did not seem capable of full

recovery, his health plan would probably not pay for his care for much

longer. Mrs. B was concerned that Mr. B was not yet strong enough to

leave the SNF, so she consulted with Mr. B’s doctor. The doctor said

that she disagreed with the therapist and that the plan should still pay

for the SNF care because Mr. B still needed skilled care from a physical

therapist to keep his condition from deteriorating. Soon after, Mr. B

received a notice from the SNF, called a Notice of Medicare Non-Coverage,

which told him that his coverage would end in two days.

Mrs. B called the Medicare Rights Center right away and spoke with a

hotline counselor. The counselor advised Mrs. B that Medicare does not

require that full recovery be possible for SNF care to be covered. SNF

care is considered “medically necessary,†and so can be covered if it

is needed to maintain your condition or prevent it from getting worse.

The counselor then explained that when a plan says it will no longer pay

for SNF care, you still have the right to appeal. However, in order to

meet the appeal’s strict deadlines, Mrs. B would have to get to work

right away. The hotline counselor told her that on the Notice of Medicare

Non-Coverage, there would be instructions explaining how to contact an

organization called a QIO, or a Quality Improvement Organization, to

start an appeal. Mrs. B found the QIO’s telephone number and the

hotline counselor told her to call the QIO to say she wanted to start an

appeal by noon on the day before Mr. B’s services were set to

terminate.

The counselor explained to Mrs. B that after she called the QIO, it would

contact the SNF to request documentation. The hotline counselor

encouraged Mrs. B to ask her husband’s doctor for a letter explaining

why ending Mr. B’s SNF care would be harmful to his health and why

physical therapy was necessary for Mr. B to maintain his condition. Mrs.

B was advised that it would also be helpful for her to submit that

written statement to the QIO as well. The counselor informed Mrs. B that

she had a right to see the information that the SNF submitted to the QIO

if she asked for it.

The QIO would have to make its decision within 48 hours. If the QIO

agreed with the therapist (that SNF care should no longer be covered for

Mr. , Mr. B might be able to continue to receive care, but he would

have to pay for it himself. If the QIO agreed with Mr. and Mrs. B, Mr. B

would have the right to continue to get covered SNF care.

Mrs. B called the QIO right away and began the appeal. She then called

Mr. B’s doctor, who wrote a letter of support and sent it to the QIO.

Two days later, the QIO informed Mrs. B that they had made a favorable

decision. Mr. B would be able to continue to receive covered SNF

care.

This message was generated by the Medicare Rights Center

list-serve.

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Medicare Watch is the Medicare Rights Center’s

fortnightly newsletter, established to strengthen communication with

national and community-based organizations and professional agencies

about current Medicare policy and consumer issues. Each edition contains

news of recent policy developments affecting Medicare and health care

generally and a case story from our hotline that illustrates steps

professionals can take to get older adults and people with disabilities

the health care they need.

The Medicare Rights Center is a national, not-for-profit consumer service

organization that works to ensure access to affordable health care for

older adults and people with disabilities through counseling and

advocacy, educational programs and public policy initiatives.

© 2008 by Medicare Rights Center. All rights reserved.

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Sheena Bhuva.

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