Group 13 Govt. Health Care Plans In the US

Question 1

Medicare covered services and cost sharing

Part 1 of 2

Answer 1

1. Part A
   
   1. 1 HI (hospital insurance) services include
      
      1. 1.1 inpatient hospital benefits
      2. 1.2 skilled nursing facility (SNF)
      3. 1.3 home health agency following discharge from a hospital or SNF
      4. 1.4 hospice care is provided to terminally ill patients
   2. 2 there are no HI beneficiary premiums
   3. 3 there are cost sharing provisions and limits on coverage
2. Part B (SMI: supplementary medical insurance)
   
   2. 1 requires a monthly premium
   3. 2 a beneficiary can decline SMI coverage
   4. 3 after deductible, Coinsurance is typically 20%
   5. 4 covered services: outpatient hospital; medical care (physicians, diagnostic tests, supplies, etc); ambulance services; physical and occupational therapy; outpatient rehabilitation; home health care beyond part A; certain drugs; and others
3. Medicare Supplements
   
   3. 1 Fills in out-of-pocket costs and benefits not covered by Medicare
   4. 2 10 standardized plan are available is most states

Question 2

Medicare covered services and cost sharing

Part 2 of 2

Answer 2

1. Part C (aka Medicare Advantage, MA)
   
   1. 1 A MC option that substitute for HI and SMI coverage
   2. 2 lower OOP, increased coverage limits, some services not in traditional Medicare
2. Part D
   
   2. 1 Provides coverage for prescription drugs
   3. 2 Prescription drug plans (PDP)
   4. 3 Medicare Advantage Prescription Drug plans (MA-PD)
   5. 4 Retiree drug subsidy (RDS)
   6. 5 Penalty for late enrollment
   7. 6 Drugs excluded from Part D: drugs covered by part A or B, over the counter, others
3. Part D 2012 cost sharing
   
   3. 1 Annual Drug Cost - $0 to $320 (Deductible)
      
      3. 1.1 Medicare pays 0%; enrollee pays 100%
   4. 2 annual drug cost $320 to $2930
      
      3. 1.2 Medicare pays 75%f enrollee pays 25%
   5. 3 annual drug cost - until member true out-of-pocket costs (TrOOP) reach $4700
      
      3. 3.1 Medicare pays 14% generic, 50% brand; enrollee pays 86% generic, 50% brand
      4. 3.2 By 2020 will be 75% Medicare, 25% enrollee
   6. 4 Annual drug cost after $4700 member TrOOP
      
      3. 4.1 Medicare pays about 95%; Enrollee pays 5%

Question 3

Medicare Eligibility

Answer 3

1. Persons at least 65 and eligible for Soc Sec
2. Most individuals with end stage renal disease (ESRD)
3. Some other ages and disabled individuals who pay mandatory premiums

Question 4

Medicare program financing

Answer 4

1. HI program is financed through payroll taxes
2. SMI is financed through general fund of treasury (75%) and beneficiary premium (25%)
3. Part D is financed through a separate account within the SMI trust fund
4. Board of trustees reports to congress on financial status each year
   
   4. 1 HI fund projected to be exhausted by 2024
   5. 2 Part B and D expenses are projected to grow as a percent of GDP

Question 5

Approaches to improving Medicare solvency

Answer 5

1. Higher taxes
2. Reduce covered services
3. Increase Medicare cost sharing
4. Raise the eligibility age
5. Adjust reimbursement to providers
6. Other initiatives such as accountable care organizations

Question 6

Medicare provider reimbursement

Answer 6

1. Hospitals: reimbursed on a prospective payment system PPS
   
   1. 1 A set amount for each admission based on the DRG
   2. 2 Receive additional reimbursement for outlier hospital stays
   3. 3 adjustment depending on the portion of services delivered to uninsured and low income patients
2. Physician services reimbursement
   
   2. 1 resource based relative value scale (RBRVS) elements
      
      2. 1.1 Nationwide convertion factor
      3. 1.2 work value, practice expense, malpractice value
   3. 1.3 geographic area
   4. 2 Physicians that are not participating may bill patients about 10% above the Medicare reimbursement amount
3. Hospital outpatient: Ambulatory payment classification

Question 7

Medicare advantage (MA) Provider reimbursement

Answer 7

1. A capitation payment
2. Bidding approach
   
   2. 1 if the bid less than the bench mark, then plan keeps 75% of the difference (the rebate) to increase benefits, reduce cost sharing, or reduce prems
   3. 2 Government keeps the remaining amount as savings
   4. 3 A bid greater than bench mark results in premium by the member
3. Risk adjusted payments
   
   3. 1 Capitation recognizes the health status of enrollees
   4. 2 considers age, sex, Medicaid eligibility, disabled status, working-aged status, and institutionalized status
   5. 3 A separate risk adjustment model for Part D
4. The Accountable Care Act (ACA)
   
   4. 1 Modified MA payments
   5. 2 Plan assigned star rating from 1 to 5 based on quality measures
   6. 3 Bonus payments are for higher rated plans
   7. 4 funding cut for lower rated plan
   8. 5 if loss ratio less than 85%, the difference must be returned to CMS

Question 8

Medicaid Eligibility and financing

Answer 8

1. Medicaid eligibility
   
   1. 1 Categorically eligible group include: children, parents or other caretakers with dependent children, pregnant women, individuals with disabilities, seniors
   2. 2 in addition to categorical requirements, income requirements (a percentage of FPL)
   3. 3 Also medically needy when medical expenses reduce income below limits
   4. 4 ACA expanded Medicaid eligibility beginning in 2014, up to 133% FPL
2. Medicaid Financing
   
   2. 1 each state finances its Medicaid program with support from Federal
   3. 2 Source of Federal funding is general revenues
   4. 3 Financing requirements driven by number of recipients and cost of services
   5. 4 the lower a state’s average per capita income, the higher the federal support
   6. 5 Under ACA, federal govt covers 100% of cost for the new Medicaid eligible for the first 3 years. Phases down to 90%

Question 9

Medicaid

1. Covered services
2. Provider participation and reimbursement

Answer 9

1. Covered services
   
   1. 1 inpatient and outpatient hospital, physician, lab and X-Ray, skilled nursing facility and HHC, transportation
   2. 2 other services: dental, drugs, prosthetics, hearing aids, glasses, physical therapy
2. Provider participation and reimbursement
   
   2. 1 forbidden from withholding services if patient is unable to pay the cost sharing
   3. 2 access must be comparable to general population
   4. 3 Medicaid reimbursement