Of all the health care plans in America, traditional Medicare does the most to ensure people get needed care. Unlike private insurance, which increasingly rations care based on people’s ability to pay, traditional Medicare treats people equitably, regardless of health, geography or income and gives people a meaningful choice of doctors and hospitals throughout the country. If you agree, call Congressman Paul Ryan, who is charting a course to destroy traditional Medicare.
What is traditional Medicare? It is a public health insurance program providing medical and inpatient coverage, available to everyone with Medicare. About 70 percent of people with Medicare choose traditional Medicare because it gives them coverage from a wide range of doctors and hospitals. And, it allows them to budget for their care. As long as they have supplemental coverage—retiree coverage from a former job, a Medicare supplemental insurance plan purchased in the individual market, Medicaid or a Medicare Savings Plan–virtually all their costs are covered. With traditional Medicare, unlike with a Medicare Advantage plan or other commercial insurance, there are no unexpected medical bills from out-of-network doctors.
How does traditional Medicare work? Traditional Medicare is designed to cover whatever care people need. Whether you need a lot of care or a little care, you can get it, and you are covered. And, you pay the same premium* and have the same out-of-pocket costs. (*Six percent of people with Medicare with incomes above $85,000 pay a higher premium than everyone else.) Medicare protects people with costly conditions from financial risk and ensures they can afford their care, so long as they have supplemental coverage that fills gaps in Medicare. With traditional Medicare and supplemental coverage, unlike with a Medicare Advantage plan or other commercial insurance, people do not pay more when they need more care. That’s why people in Medicare Advantage plans often switch to traditional Medicare when they need costly care.
How does traditional Medicare keep costs down? The government uses its negotiating leverage to set doctor and hospital rates for people with traditional Medicare. Commercial insurers like United Health and Aetna are unable to exert the leverage Medicare does to keep rates down and therefore generally pay hospitals and doctors higher rates. That raises people’s premiums and health care costs. Medicare Advantage plans currently benefit from traditional Medicare’s rates, which drive competition in the Medicare marketplace and helps to keep costs down. But, they also have high administrative costs. Overall, Medicare is more efficient than commercial insurance.
How does traditional Medicare allow for innovation? Health policy researchers rely on traditional Medicare to understand what’s working and not working in our health care system. Without traditional Medicare, these researchers would be at a loss to understand our health care system as deeply or broadly as they do because Medicare’s data is publicly available to study. But, commercial insurers treat their data as proprietary and usually are not willing to share it. They do not want to be accountable to anyone other than their shareholders and, for the most part, they are not obligated to be.
How does traditional Medicare drive system change? Traditional Medicare’s transparency and public accountability enable government to drive health care system improvements. Commercial insurers are financially incentivized to help themselves and their shareholders, not to serve the public good. They generally take advantage of traditional Medicare’s innovations.
If you do not want Congress to destroy traditional Medicare, call House Speaker Paul Ryan. Congressman Ryan and Republicans in Congress want to weaken and destroy public programs like traditional Medicare and limit government spending, even if the result is to deny affordable health care to older adults and people with disabilities. If Congressional Republicans get their way, older adults and people with disabilities will be denied the choice of traditional Medicare, if not immediately, then over time. While some people are happy with their Medicare Advantage plans today, Congressional Republicans are likely to give Medicare Advantage plans even more tools to drive profits and shift more costs to older adults and people with disabilities. No one can say exactly what will happen. But, here’s what’s likely to happen:
- To limit government spending on Medicare, the federal government will stop paying for all the care people need and instead will pay a fixed amount of the cost, effectively giving each person a voucher.
- The Medicare voucher would likely cover the cost of most care for people in relatively good health.
- The Medicare voucher would likely result in people with costly conditions trying to scrape together the funds needed to pay for their care or to forgo care altogether.
- The new health care system for people with Medicare would drive up costs in traditional Medicare and force more people with traditional Medicare into Medicare Advantage plans.
- Commercial insurers offering Medicare Advantage plans would likely be able to shift more costs onto people who need care most, forcing them into medical bankruptcy or to forgo needed care.
- They would continue to have narrow networks, forcing people with costly conditions to pay out of pocket for out-of-network care.
- They would offer plans with high deductibles, requiring people who need care to pay hundreds or thousands of dollars out-of-pocket before their coverage kicks in, along with high copays and coinsurance for costly care.
- They would continue to exclude from their formularies drugs that people with costly conditions need.
- And, they would likely begin to charge higher premiums. As people are forced to moved out of traditional Medicare, the Medicare Advantage plans would lose their ability to use traditional Medicare rates as leverage to keep rates down; instead, they would be forced to pay doctors and hospitals higher rates, likely driving up people’s premiums.
If you are thankful for traditional Medicare, please sign this petition from Social Security Works.
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