Health for life

So, how bad is it?

While HHS Secretary Sebelius Affordable Care Act nostrums help the Obama Administrations muddling of policy and election year politics, CMS Chief Actuary Richard Foster has stepped forward (see page 277) with some blunt language about Medicares solvency.  As the Disease Management Care Blog understands it, official projections on just when the money runs out are based on current law. 

Thats the rub:  

"While the Part B projections.... are reasonable in their portrayal of future costs under current law, they are not reasonable as an indication of actual future costs. Current law would require a physician fee reduction of an estimated 30.9 percent on January 1, 2013—an implausible expectation."

"[W]hile the Affordable Care Act makes important changes..., there is a strong likelihood that certain of these changes will not be viable in the long range. Specifically, the [anticipated] annual price updates for most categories of non-physician health services will be adjusted downward each year by the growth in economy-wide productivity. The best available evidence indicates that most health care providers cannot improve their productivity to this degree—or even approach such a level—as a result of the labor-intensive nature of these services."

"Without unprecedented changes in health care delivery systems and payment mechanisms, the prices paid by Medicare for health services are very likely to fall increasingly short of the costs of providing these services. By the end of the long-range projection period, Medicare prices for ... many services would be less than half of their level under the prior law. Medicare prices would be considerably below the current relative level of Medicaid prices, which have already led to access problems.... Well before that point, Congress would have to intervene to prevent the withdrawal of providers from the Medicare market.... "

"Finally, the economic outlook remains more uncertain than usual. Due to the sensitivity of HI trust fund operations to wage increases and unemployment, the current slow recovery from the recent recession adds a significant further element of uncertainty to the trust fund projections."

The Medicare Modernization Act - signed into law by President Bush on December 8, 2003 - added an outpatient prescription drug benefit for all people with Medicare. Coverage under this benefit goes into effect on January 1, 2006. (Clicking on the new "Medicare-Approved" seal shown will take you to the Medicare site.)

You must enroll to be covered by the prescription drug plans. Enrollment begins on November 15 of this year. You have until December 31 to enroll if you want your coverage to start on January 1.

There will be a number of plans to choose from with differing monthly premiums ("generally about $37 in 2006") and copayments. Your health or income cannot prevent you from benefiting from one of these plans - even if you have prescription drug coverage from an employer, union, or other policy (e.g. Medigap). Those with limited income will get help paying for their coverage.

Medicare lists the following important dates regarding the new prescription drug plans:

• October 2005 - Medicare recipients will receive the Medicare & You 2006 handbook with information on how to sign up.
  
• November 15, 2005 - Sign-up begins.
  
• December 31, 2005 - Last day to sign up to receive coverage beginning January 1, 2006.
  
• January 1, 2006 - Coverage begins.
  
• May 15, 2006 - Last day to sign up for coverage in 2006. (Late fees are charged after that date. Enrollment begins again on November 15, 2006 for coverage in 2007.)

More information about the new prescription drug plans is available at www.medicare.gov or by calling 1-800-MEDICARE (1-800-633-4227) 24 hours a day, 7 days a week.

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Below are a few links that answer basic questions. They are all pdf files requiring an Adobe reader to view. (You can download an Adobe reader for free here.) More links about the new prescription drug plans can be found here.

• Basic Information (Very informative, detailed, and recent text file. August 2005)
  
  
• Quick Facts about Medicare’s New Coverage for Prescription Drugs (May 2005)
  
  
• Who Can Help Me Apply and Enroll? (July 2005)
  
  
• Protecting Your Personal Information (July 2005)
  
  
• A Message for People who Care for Someone with Medicare (July 2005)