Health care reform: myths and misconceptions

As Congress has debated the pros and cons of health reform over the past few months, you may have heard conflicting and/or confusing information concerning what the various proposals for health care reform do and don’t do.

Part of the reason for the confusion is the fact that at this point in time there are still several different proposals on the table rather than one agreed-upon proposal. There is a House bill (H.R. 3200) being worked on by three separate committees. Each committee has been focused on different aspects of the bill, and is now in the process of putting the work of the three committees into one bill. In the U.S. Senate, two committees are working on a different health care reform proposal. Given the complexities of the issues and the five different committees that have jurisdiction related to health care reform, it is not difficult to see why there is confusion.

Another reason for the confusion has been a mischaracterization of some of the elements of the proposals by those opposed to reform. The most notorious of these is the so-called “death panel,” which refers to a portion of House Bill 3200 that allows for Medicare reimbursement to physicians for consulting with their patients every five years regarding advance care planning. This has been characterized by some who oppose health care reform to imply that treatment under Medicare could be denied if a person is not productive or would cost too much. This is very much not the case.

Electing to receive the consultation is entirely voluntary on the part of the Medicare beneficiary; and the purpose of the advance care planning is to simply encourage people to think about the kinds of care they want, or don’t want, at the end of their life by completing Powers of Attorney for Health Care and Living Wills.

Powers of Attorney for Health Care provide a person’s loved one (of the person creating the Power of Attorney for Health Care’s choosing) with the legal authority to make medical decisions for the person in the event the person is unable to make those medical decisions him or herself.

Living wills are documents that provide direct instructions to a person’s physicians as to their desires regarding the insertion/withdrawal of feeding tubes if he or she is in a persistent vegetative state and the administration of life-sustaining measures to be taken if he or she is in a terminal state.

These documents instruct a person’s loved ones and physicians as to the type of care and life saving/sustaining measures he or she desires in the event he or she is unable to articulate those desires.

The purpose of the consultation is not for some government entity to decide who lives or who dies but to enable a person to control the type of medical care they want in the future if they are unable to articulate their health care desires by executing advance directives.

This legislation is merely an extension of a law signed by former President George W. Bush requiring hospitals and other institutions to make admitting patients aware of their option to complete these advance planning forms.

Completing an advance directive is an important activity that everyone should engage in. There is no such thing as a death panel!

Another common misconception (heartily perpetuated by opponents of health care reform) is that the proposals will fund health care reform at the expense of Medicare benefits. While the House bill projects a 10-year Medicare savings (2010-19) of $538.5 billion, the savings will be achieved not by cutting benefits. The savings will be achieved by (1) cutting the amount of government subsidies to private insurers providing Medicare Advantage plans, (2) setting up new ways to pay doctors more fairly and to reward providers for quality of care instead of (as now) paying them a fee for each separate service, and (3) providing greater coverage for preventative care which, in turn, reduces later, costlier care that would occur in the absence of the preventative care.

The original impetus for allowing private insurers to offer Advantage plans was to save Medicare dollars. What has occurred in practice is that Advantage plans have cost the government more than it cost the government to provide Medicare benefits through traditional Medicare (Medicare Parts A and B). Indeed, studies have revealed that Advantage plans cost an average of 14 percent more per person than traditional Medicare does. Thus, none of the proposals Congress is considering would fund health care reform by cutting Medicare benefits.

On the contrary, the current proposals not only do not reduce Medicare benefits, they improve Medicare benefits through some very significant benefit additions and enhancements:

• Elimination of the dreaded Medicare Part D “donut hole” (gap in coverage amounting to thousands of dollars where the beneficiary has to pay 100 percent of the cost of his or her medications) over 15 years starting with a $500 reduction in 2011.

• Increasing the asset limit for the Medicare Part D Low Income Subsidy (both full and partial) and the Medicare Savings Programs (QMB, SLMB & SLMB+) to $17,000 for individuals and $34,000 for couples effective Jan. 1, 2012, and indexing the asset limit to inflation for subsequent years. (Under current law, the asset limit used to determine eligibility is $4,000 for individuals and $6,000 for couples for the Medicare Savings Programs, $6,600 for individuals and $9,910 for couples for the full Part D low-income subsidy and $11,010 for individuals and $22,010 for couples for the partial low-income subsidy).

• Making it easier for individuals to apply for the Medicare Part D Low Income Subsidy by allowing them to self-certify their income and assets as of 2010.

• Waiving deductible and co-insurance for Medicare-covered preventative benefits as of Jan. 1, 2011.

• Permitting Part D enrollees to make a mid-year change in their enrollment if coverage is reduced or cost sharing is increased for a drug they currently take under their Part D plan effective Jan. 1, 2011.

• Establishing new penalties for false or misleading marketing by Medicare Part D plans.

These are simply the most prominent of the many Medicare benefit improvements contained in the current health care reform proposals.

As mentioned at the beginning of this article, it’s still much too early to pass judgment on national health reform, either for or against, because the elements of that reform have not been made concrete. Things will change between now and later this year when the bill is in final form. Until that time, you should simply be aware of what the current proposals do and do not actually propose. Don’t believe the hype!

If you have any additional questions, you may call Pat Hafermann, elderly benefits specialist with the Aging and Disability Resource Center, at (920) 459-4389.

Resource: “The Specialist” August 2009.