JustCare

Tag: Penalty

  • Biden administration penalizes drug companies hiking drug prices above the rate of inflation

    Biden administration penalizes drug companies hiking drug prices above the rate of inflation

    The Inflation Reduction Act (IRA), which became law in August 2022, appears to be working to rein in the ever-escalating price of some prescription drugs. Jonathan Cohn writes for the Huffington Post about 43 prescription drugs with price increases greater than the rate of inflation. The Biden administration has signaled them out for Medicare savings, imposing penalties on the drug companies that manufacture them.

    Humira, a very popular drug that treats inflammatory conditions, and Leukine, a drug that protects people on chemotherapy from infections, are two drugs with big price hikes that the Biden administration has identified. As a result of the IRA, our federal government will impose monetary penalties on drug companies manufacturing  the 43 drugs with excessive price increases. And, people with Medicare who take any of these drugs will pay lower coinsurance for them, saving $1 to $449 per prescription.

    None of the drugs on this initial list are prescription drugs covered under Medicare Part D. Rather they are all administered by a doctor and are covered under Medicare Part B, under which people pay 20 percent coinsurance if they do not have supplemental coverage to pick up that cost. People with supplemental coverage should also benefit from the IRA because the government penalties should help keep their supplemental insurance premiums down.

    Over time, the list will grow to the extent pharmaceutical companies raise prices at rates greater than the rate of inflation. And, the list will include drugs covered under Medicare Part D.

    The IRA also caps insulin costs for people with Medicare to $35 a month. And, beginning in 2025, the IRA caps out-of-pocket spending under Medicare Part D at $2,000 a year.

    All these advances to curb prescription drug costs for the Medicare program and the older adults and people with disabilities who count on Medicare are meaningful. These reforms will make it much easier for many people to get their drugs. But, the IRA still leaves people with Medicare paying far more than people in other wealthy countries for their drugs. And, even with the IRA, pharmaceutical companies can gouge Americans when it comes to drug prices.

    Here’s more from Just Care:

  • One in four Medicare Advantage plans engage in misleading marketing

    One in four Medicare Advantage plans engage in misleading marketing

    Allison Bell reports for Think Advisor on the federal government’s decision to hold off issuing a rule imposing an extra penalty on Medicare Advantage plans for misleading marketing. It appears that too many Medicare Advantage plans would be affected. What’s clear is that so long as corporations can cover Medicare benefits, older adults and people with disabilities will be scammed.

    Specifically, the government is not issuing a new penalty on Medicare Advantage plans for misleading marketing that results in people being retroactively disenrolled from Medicare Advantage plans. Its reasoning is that another penalty on Medicare Advantage plans presents too big a change in star-ratings and payments to these plans. It’s a bit like a city determining that it won’t close down restaurants that pose health risks in order to make sure the city has enough restaurants.

    CMS claims it needs to use a formal rulemaking process to impose this new penalty. Too many MA plans would be affected.  “Overall, we found a decrease in the star assignments for almost one-quarter of MA-PD contracts using the changed complaint measure specifications that include marketing misrepresentation complaints.” Put differently, had CMS imposed the extra penalty, 25 percent of Medicare Advantage plans would have seen lower star ratings and lower payments.

    As it is, Medicare star-ratings of Medicare Advantage plans are a farce. No one should rely on them in choosing a plan. A five-star Medicare Advantage plan is about as different from a five-star hotel as night and day. In a five-star Medicare Advantage plan, you can’t count on getting coverage from the doctors and hospitals you want to use, nor can you know whether the copays are affordable.

    Needless to say, insurers are pleased with the CMS decision. They get away with misleading people into signing up with them, claiming they are competing to provide important services and being overpaid. Meanwhile, they do not allow MedPAC to assess the quality of care they offer, engage in widespread inappropriate delays and denials of care, and do not let anyone meaningfully distinguish among them. Had the penalty been implemented, one in four Medicare Advantage plans would have seen their star-rating score fall by 24 percent.

    Will CMS use a formal rulemaking process to impose the extra penalty. Who knows?

    Here’s more from Just Care:

  • Medicare hospital star-ratings are a farce

    Medicare hospital star-ratings are a farce

    Every year, Medicare penalizes hospitals that underperform. This year, it penalized 764 hospitals because they had high rates of patient infections and complications that could have been avoided. Jordan Rau of Kaiser Health News reports that, of those it penalized, it gives five star-ratings to 38, signaling that they are among the best in the nation.

    Medicare penalized an additional 138 hospitals with four-star ratings. Do not rely on these star-ratings exclusively when choosing a hospital!!!!

    Medicare penalizes hospitals financially with a one percent reduction in payments if Medicare patients experienced high readmission rates, death rates, infection rates, and/or said they had a poor experience. The goal is to get hospitals to minimize bedsores, hip fractures, infections and blood clots.

    Many hospitals that you might think of as first-rate were penalized this year, including the Cleveland Clinic in Ohio, the Mayo Clinic in Red Wing, Minnesota and Phoenix, Arizona. Each of these hospitals had Medicare five-star ratings.

    It’s not at all clear that the penalties are changing hospital practices, based on recent analyses. It’s also not clear that all hospitals are reporting accurate information that would result in assessing penalties against them. The penalties are a big financial hit for hospitals.

    The penalties might save Medicare money, but they seem poorly designed. They must be charged to the 25 percent of hospitals with the greatest safety issues, even if these hospitals perform about the same as other hospitals or they have improved significantly from the prior year.

    Medicare cannot impose a penalty on critical care access hospitals. They tend to be rural hospitals. They can also be rehab, psychiatric and long-term care hospitals. Hospitals in Maryland are also excluded because they are paid under an all-payer system.

    Of note, Medicare does not penalize Medicare Advantage plans that perform poorly in the same way. It is not required to reduce payments to the worst performing MA plans. In fact, it doesn’t even recoup tens of billions of dollars in overpayments to them, driving up costs for everyone with Medicare and eroding the Medicare Trust Fund.

    Here’s more from Just Care:

  • It’s time to enroll in a health plan if you are under 65

    It’s time to enroll in a health plan if you are under 65

    Open enrollment in state health exchanges begins on November 15 and lasts through February 15.  You can enroll in a health plan or switch health plans even if you have costly health care needs.  Health plans cannot cancel your coverage if you need costly health care. Here are four things to keep in mind:
    1. Help with premiums: If your income is no more than four times the federal poverty level (between $11,670 and $46,680 for an individual or $23,850 and $95,400 for a family of four), you are eligible for help with the premiums.
    2.  Automatic reenrollment: If you have health insurance through an exchange and do nothing, you will be reenrolled in the same health plan.  But, if you’re smart, you’ll visit healthcare.gov to see whether there are any new plans in your area and what your current health plan is offering in terms of costs and benefits as compared to other health plans in your area.  Read these tips for choosing a health plan.
    3. Expanded Medicaid eligibility: If your income is at or below 138 percent of the federal poverty level ($16,105 for an individual and $32,913 for a family of four) in many states you are likely eligible for Medicaid
    4. Penalty if you go without health insurance: If you did not have insurance in 2014 or if you don’t have insurance in 2015, you will pay a penalty when you file your federal taxes.  In 2014, the penalty is $95 or 1% of your income, whichever is higher.  In 2015, the penalty is $395 or 2% of your income, whichever is higher.

    If you enroll after the 15th of the month, your coverage will not begin until a month and a half later.  If you enroll between the 1st and 15th of the month, your coverage will begin on the 1st of the following month. For more information, check out the Kaiser Family Foundation’s Consumer Guide.

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