Good Deal or Rip-Off?
Medicare Advantage is a good concept: the government offers an HMO option instead of the disjointed fee-for-service of traditional Medicare. The insurance company receives a fixed annual payment for every beneficiary. Medicare Advantage eliminates billing hassles, keeps patients in organized systems of care and emphasizes quality and access. My patients love it, particularly since they are accustomed to HMO insurance.
Now, the sticky part. Congress provided incentives for the insurance industry to participate in this program. Since then, most insurance companies have gained financially from this program. Some argue that this has been related to good management while others contend that some insurers have ripped off the government.
The facts should speak for themselves: did patients get access to cost effective and appropriate care? Was quality improved? Are the patients highly satisfied? If the answers are all favorable, then the "profits" were well deserved--and the public got its money's worth, at a negotiated, fixed price. This is what "bending the medical inflation curve" all is about.
On the other hand, if none of these goals were achieved, the taxpayer got a raw deal. Therefore the government has every right to reset its price and its expectations. However, this needs to be managed on a case-by-case basis, by examining the performance of every contractor.
Americans are used to this. We shop for good deals in large retailers like Wal-Mart and Costco and worry little about their profits. For Medicare Advantage, the federal government must be our prudent shopper--and manage this program by business fundamentals rather than sweeping legislation.
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