February 2023

February 2023

Congress Off to a Slow Start

Congress is off to a slower start this year, even as critical issues that soon must be dealt with remain unsettled. This seems to be especially true in the House of Representatives, which in the past usually got its work done faster than the Senate.

One of the ways the slowness is evident is that many of the House committees’ websites remain almost unchanged since the end of 2022.  Hopefully, those sites will be updated soon.

The slower start this year is probably due, at least in part, to the fact that the Republicans have taken control of the body and this sort of transition takes time.

Over in the Senate there could soon be a vote on a bipartisan drug patent measure, a move that could test the pharmaceutical industry’s influence in Congress.

Senate Democratic leaders want to hold a vote on a bill that would end two kinds of abuses of the drug patent process that many Senators say the big drug companies use to increase their profits at the expense of the public.

The claim is that the drug companies misuse two processes that enable them to keep their patents on drugs they’ve developed and prevent much lower-cost generic drugs from being put on the market.

Sen. John Cornyn (R-Texas), one of the sponsors of the bill, has pushed for years to ban patent abuses. Cornyn has said the drug industry has long opposed reforms to the patent system and worked to block similar bills in the past.

The big drug companies oppose the bill, saying that its provisions could severely damage the drug innovation system, an argument they seem to use every time legislation to deal with their alleged abuses is dealt with in Congress.

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After Charges of Fraud, Insurance Companies Push Back

Cutting “waste, fraud, and abuse” is always part of the solution politicians bring up when they discuss how to reduce government spending.  But there’s a debate about just what “waste, fraud, and abuse” really is.

A classic example is what’s happening with Medicare Advantage plans.

According to federal audits, eight of the ten biggest Medicare Advantage insurers — representing more than two-thirds of the market — have deliberately overcharged Medicare for the services they have provided.

What is more, four of the five largest players — UnitedHealth, Humana, Elevance, and Kaiser — have faced federal lawsuits alleging that efforts to over-diagnose their customers crossed the line into fraud.

Now, the insurance industry and Republicans are using the debt ceiling fight and President Biden’s vows not to cut Medicare to fend off changes to private Medicare Advantage plans, which are popular among the public but have faced criticism about their costs to the government.

So far this year, the Centers for Medicare and Medicaid Services has released two rules aimed at reducing overpayments to Advantage plans while increasing oversight — moves long recommended by nonpartisan government watchdogs and economists.

But insurance companies that sell Medicare Advantage plans are running ads accusing the White House of cutting seniors’ benefits — a tactic the industry has used before to avoid changes to the program.

According to one estimate, an organization representing the insurance companies has spent $10.5 million on television ads in 2023, more than twice the next highest spending advertiser in the country, with Washington, D.C., Phoenix, and Las Vegas the most targeted markets.

But those attacks are misleading, experts and advocates say, pointing to long-standing recommendations from government watchdogs that Congress and CMS rein in over payments to Advantage plans, which have enjoyed increased enrollment and profits over the past decade.

The government pays Medicare Advantage insurers a set amount for each person who enrolls, with higher rates for sicker patients. And the insurers, among the largest and most prosperous American companies, have developed elaborate systems to make their patients appear as sick as possible, often without providing additional treatment, according to the lawsuits.

As a result, a program devised to help lower healthcare spending has instead become substantially more costly than the traditional government program it was meant to improve.

In statements, most of the insurers disputed the allegations in the lawsuits and said the federal audits were flawed. They said their aim in documenting more conditions was to improve care by accurately describing their patients’ health.

But at least one Republican Senator agrees with the Biden Administration. “Medicare Advantage is an important option for America’s seniors, but as Medicare Advantage adds more patients and spends billions of dollars of taxpayer money, aggressive oversight is needed,” said Senator Charles Grassley of Iowa, who has investigated the industry. The efforts to make patients look sicker and other abuses of the program have “resulted in billions of dollars in improper payments,” he said.’

A long-awaited rule finalized last month would seek to recover more than $4 billion in over payments to plans over 10 years, enhance future audits, and make it easier for the government to recoup over payments.

As part of its annual payment updates to Medicare Advantage plans, CMS proposed earlier this month a 1 percent increase for 2024 — a smaller increase than proposed in past years that is being framed as a cut by the industry.

The irony is that Medicare Advantage, which allows private insurers to manage federally funded health care plans for those 65 and older, was created to reduce costs, under the assumption that private industry is more efficient than government. But the evidence suggests that insurers have exploited the Medicare Advantage system to inflate their profits, using techniques that include making their patients appear sicker than they are, thereby inflating their bills.

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Millions could Lose Medicaid Coverage This Year 

Roughly 84 million people in the U.S., including 7.2 million low-income seniors, are covered by Medicaid, which has grown by 20 million people since January 2020, just before the COVID-19 pandemic hit.

But as states begin checking everyone’s eligibility for Medicaid for the first time in three years, as many as 14 million people could lose access to that health care coverage.

At the beginning of the pandemic, the federal government prohibited states from kicking people off Medicaid, even if they were no longer eligible. Before the pandemic, people would regularly lose their Medicaid coverage if they started making too much money to qualify for the program, gained healthcare coverage through their employer, or moved into a new state.

Over the next year, states will be required to start checking the eligibility again of every person who is on Medicaid. People will have to fill out forms to verify their personal information, including address, income, and household size.

Some states are moving faster than others to check eligibility. Arizona, Arkansas, Florida, Idaho, Iowa, New Hampshire, Ohio, Oklahoma, and West Virginia are among the states that will begin removing ineligible Medicaid recipients as early as April.

Other states will start taking that step in May, June, or July.

Not everyone will be removed from the program all at once. States plan to verify all recipients’ eligibility over periods of nine months to one year.

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For progress updates, or for more information about these and other bills that would strengthen Social Security and Medicare programs, visit our website at www.SeniorsLeague.org or follow TSCL Facebook or on Twitter.