Memo to USA Today: Medicare is Freakin' Complicated

I guess if Joe Biden can say "ObamaCare was a big freakin' deal," I guess I can say "Medicare is freakin' complicated."

On August 16, USA Today put out a simple Q and A on Medicare and it looks like -- despite the paper's left leanings -- that the article was a simple attempt to provide good-old-Joe-Friday "just the facts ma'am" reporting. And yet in less than about 500 words, USA Today made a half dozen serious errors of omission or commission about Medicare. None appear to me to have anything to do with national politics but the problem with such articles is that it takes 1,000 words to correct the misconceptions that they leave.

It's just that Medicare is so freakin' complicated. Here are the problems in order of importance:

1. USA Today says

"There are no cuts in (traditional Medicare) benefits (under PPACA, the Patient Protection and Affordable Care Act), and, in fact, seniors have already seen preventive services, such as annual exams and cancer screenings, with no co-pays."

That USA Today statement is somewhere between not true and very confusing wording. Most people would think USA Today is referring to "annual physical exams." Traditional Medicare does not pay for an annual physical exams, period -- with or without a co-pay. Never has.  Doesn't under PPACA. Neither the long-established Welcome to Medicare Visit nor the new-with-PPACA Annual Wellness Visit is an annual physical exam. 

Furthermore, not all of the screenings are annual (e.g., colonoscopies are only covered once every five years, bone density tests are only covered every other year, and aortic aneurysm screening is only covered once and only if you go to a "Welcome to Medicare" visit). Many of the best cancer screenings involve a co-pay -- e.g., a DRE, the best test for prostate cancer -- or no exam or either or both. USA Today's statement is so broad to perhaps be intentionally misleading (but I think it is just because Medicare is so freakin' complicated). And oddly many of the screenings such as mammograms and PSA tests that one part of the Obama administration is touting as a benefit, other parts of the Obama administration are declaring to be not useful. (See pages 37-54 of the Medicare and You booklet.)

2. USA Today says:

"...private insurance options (would) be more expensive (under RyanCare)"

No, that USA Today answer is not necessarily true and there are many current examples where it is not true. But more important that's the way it works today. Some private insurance is more expensive, some is less expensive but almost everyone on Medicare has it.

 

• Over 80% of Medicare beneficiaries today buy private insurance. Some of it -- maybe most of it --  is more expensive than traditional Medicare (if you don't count the Medicare Part A premium you paid through 40 years of payroll taxes) but not all of it is.
• About 14% of Medicare beneficiaries are on Medicaid because they are low income (and they need more help than traditional Medicare provides because traditional Medicare is terrible insurance).  There is some overlap in these two groups -- the 'over 80%' and the 'about 14%' 
• Only 8% of us seniors use traditional Medicare only and many of us do that because 
  • we are getting full private insurance through a spouse 
  • we are in the VA system
  • we are apparently very rich and do not care (we basically self-insure)
  • we have fallen through the cracks although CMS has recruited, trained and certified 25,000 volunteers to work in senior centers and such sites around the United States to try to get everyone on private insurance (see page 15 of the Medicare and You booklet for how that works). 

And many private Part C insurance plans today are less expensive than Traditional Medicare. For some there is no premium and the private insurer gives back to the senior all or part of the senior's Part B premium making the price as low as 'minus $100 a month.' Despite what USA Today says, there is no reason that something like that will not happen under the Ryan plan.

3. USA Today says:

"(Medicare Part C) Insurers must provide all (traditional Medicare) benefits to participate in Medicare (Part C) Advantage (and therefore Medicare Part C benefits will not decrease)"

USA Today is incorrect. The correct answer is "don't know but most likely YES, Medicare Part C benefits will decrease.

 

What USA Today is trying to say, probably, is that to participate in Part C, the insurer must at least match traditional Medicare. But Medicare Part C plans provide many extras above traditional Medicare. Annual physicals are a major example of a feature not included in traditional Medicare (per above) but often included in Part C plans as an enticement to join.  As the government rebate is decreased, it is likely that these extra benefits will decrease. In fact, that's the official position of the Medicare actuary who believes that decreased benefits and higher prices caused by PPACA will almost eliminate the Medicare Part C program.

4. USA Today says

"Like Obama's plan, the Republican plan includes higher Medicare premiums for wealthier beneficiaries. And it includes extra government subsidies for lower-income beneficiaries."

That USA Today statement is true but both these facts have been true for many years; they have nothing to do with either guys' plan (well a little to do with PPACA). 

The 2003 law that created Medicare Part D and reformed Medicare Part C (which most Republicans voted for and most Democrats opposed) introduced the idea of higher Medicare Part B premiums for higher income seniors. In 2010 PPACA added higher Part D premiums for higher income seniors. Conversely there has long been help with traditional Medicare premiums for low-income seniors and the 2003 law that created Part D also provided premium assistance for low-income seniors, as well as low co-pays, and made it impossible for low-income seniors to fall into the donut hole.

5. USA Today says:

"The premium fell in 2012 to $99.90, down $14.50 from 2011."

USA Today is incorrect but more important it is misleading. The premium in 2012 is $99.90.

• If you're one of the about 500,000 people or so that joined Medicare in 2010, your premium in 2012 is about $10 lower than it was in 2010 and 2011.
• If you re one of the about 800,000 people or so that joined Medicare in 2011, your premium in 2012 is about $16 lower than it was in 2011.
• But if you re one of the about 40,000,000 people or so that joined Medicare before 2010, your premium in 2012 is about $3 higher than it was in 2009-2011.

Huh, you say? Sorry but the answer is long and this post is way too long already. But USA Today is wrong. Take my word for it. No one that has anything to do with Medicare would say the Part B premium went down this year.

6. In the USA Today article (and throughout all reporting on the 2012 national election), there is a general reference to

"Obama's plan" for Medicare"  

It is not inaccurate to think of it as Obama's plan if USA Today wants to.  But it is more accurate to remember that "Obama's plan for Medicare" is the law of the land, the Patient Protection and Affordable Care Act. It is a done deal.  This isn't a case of "wouldn't it be nice if..." Your only choice if you like the other plan is to choose the other guy.

-- Dennis Byron