Jun ‘11
2
Regional Medicare Program
The Institute of Medicine yesterday announced the first phase of its analysis of disparities in Medicare payments to health care providers across the country. It found that the adjustments to payment rates needed a foundation that reflected reality not national assumptions. Minnesotans have long known that the cost of delivering health care services varies with the medical practice culture and what doctors do varies substantially. There may be as many as 70 or 80 varying regions of the country. Both Democratic and Republican Health and Human Services (HHS) secretaries have acknowledged this, but assumed Congressional politics made change impossible.
The first Medicare test involving use of private health plans and a premium support (legged at 95% of the amount paid under traditional Part A/Part B Medicare) occurred in Minnesota and a few other regions beginning in 1985. It was hugely successful but never became consistent Medicare payment policy. Minnesota seniors took the inequity in payment issue all the way to the U.S. Supreme Court and lost because the court said this was an issue for the Congress to decide. Which they haven’t.
The right answer by now should be obvious: Medicare should operate using private contractors (carriers/intermediaries built into the 1965 law) in each distinctly different region. Regional Medicare should have the authority and the resources to measure provider performance and change payment to share savings with accountable health plans and care organizations. This should satisfy Paul Ryan/Tim Pawlenty Republicans and Obama Democrats.
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