Paying for Health Care Reform with Medicare/Medicaid Savings

Here in Asheville North Carolina, health insurance reform is a huge issue as our local population consists largely of retirees, many of whom are becoming increasingly concerned about the cost sustainability of their Medicare and their North Carolina health plans. As health care costs continue to rise, reform is something the Obama Administration earnestly hopes to include in the 2010 Fiscal Budget. President Obama has identified savings which could constitute a reserve fund for the proposed health care reform plan. Approximately half of the funding would come from proposals to generate revenue, while the rest would come from Medicare and Medicaid savings.

Based on White House projections, the Medicare savings proposals would reduce beneficiary premiums for physician and outpatient services by about $33 billion over the next decade. As a result of these proposals, beneficiaries would also see an improvement in the quality of their Medicare services. The reserve fund includes a host of Medicare/Medicaid savings proposals, some of which include:

- Improving the accuracy of Medicare and Medicaid payments. The Centers for Medicare and Medicaid Services (CMS) would have to strengthen their integrity efforts in order to address flaws that have led to billions in overpayments and fraud each year.

- Reducing Medicare overpayments to private insurers would save taxpayers roughly $177 billion over 10 years, as well as reduce Part B premiums. This would be accomplished through the establishment of a competitive system in which payments are based on an average of plans' bids submitted to Medicare.

- Reducing hospital readmission rates and improving post-hospital care. The idea here is that a combination of incentive payments and penalties would lead to better care and fewer readmissions, which would save approximately $25 billion over 10 years.

- Expanding the Hospital Quality Improvement Program to improve quality of care for beneficiaries. This would be done by tying a portion of Medicare payments for acute in-patient hospital services to hospital performance on certain measures of quality. As a result of this effort, Medicare would save around $12 billion over 10 years.

- Cutting waste, abuse and fraud. When it comes to care, patients need quality, not quantity. Unnecessary treatments are not only expensive, but can also pose risks to patient health. To prevent physicians from ordering unnecessary treatment, the Administration proposes increasing scrutiny (through a pre-payment review process) in high-risk areas or for those physicians who order an excessive amount of high-risk services.

For residents of North Carolina, health insurance, Medicare and health care reform are no doubt important topics. As citizens directly affected by these potential changes in policy, it's important that you stay abreast of the facts, beware of misinformation surrounding health care reform, and show your support for legislation that speaks to your needs (which are probably not unlike those of many other Americans). If you are satisfied with your Asheville North Carolina health plans, rest assured in knowing that under Obama's plan, you would be able to keep your private insurance and continue seeing the doctors you trust.