Medicare Advantage a Model for Savings, Panel Chairman Says

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By Michael D. Williamson

March 16 — Medicare's fee-for-service program should be reformed to more closely resemble the Medicare Advantage program, the leader of an influential House panel said March 16.

The traditional fee-for-service program is on a trajectory of higher costs and little innovation, while the Medicare Advantage program is based on market principles, House Ways and Means Health subcommittee chairman Pat Tiberi (R-Ohio) said at a hearing on preserving and strengthening Medicare.

There is a substantial body of evidence suggesting that Medicare Advantage enrollees have lower utilization than enrollees in the traditional program, Katherine Baicker, a Harvard University health economics professor, testified.

Medicare Advantage plans are private managed care organizations that contract with the federal government to coordinate care for Medicare beneficiaries who choose to enroll.

Another witness, Robert Moffit, a senior fellow at the Heritage Foundation, a conservative think tank, suggested other reforms to strengthen the program, such as increasing the Medicare's eligibility age or requiring higher-income beneficiaries to pay more in premiums.

However, these ideas—and other proposals offered by the Republican side—would end Medicare as it is known, Rep. Jim McDermott (D-Wash.), the subcommittee's ranking member, said.

Other Ideas

McDermott also chastised Republicans for failing to offer any new proposal to bolster Medicare's integrity.

Likewise, Rep. Michael Thompson (D-Calif.) urged the subcommittee's leadership to consider novel approaches to reducing program costs. In studying Medicare, “I really think there's an opportunity to really drill down” to enhance the program into one seniors really like, he said.

For example, instead of rehashing old proposals, the subcommittee should explore the expansion of Medicare's telehealth benefit, Thompson said. He said several House lawmakers have introduced bills to expand telehealth.

Expanding telehealth would benefit the Medicare program because it saves lives and decreases costs, Thompson said. Moreover, expanding the service enjoys bipartisan support, he said.

Statutory and regulatory constraints on Medicare reimbursement have long deterred advancement and adoption of telehealth by providers. However, efforts to expand Medicare reimbursement for telehealth and remote patient monitoring services have failed in the past partly because the Congressional Budget Office has reported they would result in higher spending by improving enrollees' access to health-care services .

The March 16 meeting marks the first time Tiberi has led a health subcommittee hearing since assuming the chairmanship. Prior to Tiberi being named the health subcommittee's chairman, Rep. Kevin Brady (R-Texas) led the panel. Brady is now the chairman of the full Ways and Means Committee .

To contact the reporter on this story: Michael D. Williamson in Washington at mwilliamson@bna.com

To contact the editor responsible for this story: Brent Bierman at bbierman@bna.com

For More Information

Details about the hearing are at http://src.bna.com/dmg.