Economics Exam 1- Medicare

Front 1

medicare- established when?

expansion (when, for whom)

Back 1

established in 1965 to cover health care costs for people age 65+

expanded in 1972 to cover people who are disabled or have kidney disease.

Front 2

3 main parts of medicare

Back 2

A, B, D

Front 3

Part A of medicare- what is it?

covers what? (4)

Back 3

HI (hospital insurance)

Covers inpatient hospital visits, some skilled nursing facility stays, home health visits and hospice care

Front 4

medicare part A enrollment

Back 4

if you pay medicare tax for certain amount of time, you automatically get Part A (no premiums- just deductible and % of cost of services)

Front 5

medicare part A- how is it paid for?

Back 5

Patients have to pay deductibles and a percentage of the cost but most people pay no premium

Front 6

Part B covers what? (3)

Back 6

Covers outpatient/physician services, some home health visits, and preventive services.

Front 7

Part B enrollment (3)

why penalties?

Back 7

Medicare eligible individuals choose whether or not to enroll in Part B, but most (~95%) do enroll

enalties for not enrolling in part B when first eligible- adds % to your premium per month delay

-this is to prevent adverse selection- people going "oh I'm healthy not, I'll sign up when I get sick"

Front 8

approximate monthly premium for Part B. other payments?

Back 8

Monthly premium of $99.90 to $319.70 (depends on income) for 2012

Patients pay a Part B deductible ($140 for 2012) and a percentage of the costs for most covered services

Front 9

medicare spending- % of beneficiaries that account for most of medicare spending

Back 9

Spending is highly skewed, with top 10% of beneficiaries accounting for 59% of Medicare spending

Front 10

-% of annual health cost per beneficiary that medicare pays for (exam i think)

% paid out of pocket

what happens to the rest?

Back 10

50%

-25% paid out of pocket by pt

-rest is picked up by combo of medicaid for low income elderly and private retiree insurance or private supplemental insurance

Front 11

medicare part A funding comes from where? (2)

referred to as what

Back 11

funded by a compulsory payroll tax (employer and employee each pay 1.45% of wages)- you pay this when you are younger and working

The payroll taxes on current workers pay for the hospital costs of people who currently are in Medicare.

Referred to as the “Medicare Trust Fund.”

Front 12

medicare part B funding (2)

Back 12

funded with a combination of general tax revenue (~75%) and premiums (~25%).

Front 13

Balanced Budget Act of 1997 what did it do

Back 13

established “Medicare Part C,” called the Medicare Advantage (MA) program (aka “Medicare Health Plans”)

Front 14

medicare "dual pathway"- describe the options (2)

option to switch?

Back 14

-choose if you want to stay in original medicare where gov't is insurance company

-or you can decide to enroll in private medicare advantage (MA) plans- where gov't pays part of the premium for you

-can switch back and forth during open enrollment period; don't have to pay penalty for part B

Front 15

medicare part C (MA program)- what is it?

Back 15

-fed gov purchases private insurance coverage for beneficiaries (pt)

Front 16

medicare 2 pathway choices (1st choice has like 3 parts)

Back 16

original medicare +/- part D via private medicare PDP +/- medigap (supplemental insurance)

OR

Medicare advantage plans

Front 17

why has Enrollment has been roller coaster ride for MA?

Back 17

reason being that govt determines premiums- if premiums are stingy or generous you have more or less medicare advantage plans coming into market

Front 18

MA- how does gov't reimbursement and private reimbursement play into the plan?

Back 18

Under Medicare Advantage, the government pays premiums to the private insurers and the insurers pay the providers

Front 19

original medicare program- gov't payment- how does it work

Back 19

Under the original Medicare program, the government acts as the insurer and pays providers for health care used by Medicare beneficiaries.

Front 20

Enrollment varies widely across states. Why?

Back 20

some states have more generous govt funding i guess

Front 21

MA plans initially were what type of insurance plan?

how about recently?

Back 21

MA plans initially were mostly managed care plans, but there has been large growth in private FFS plans in the past few years.

Front 22

costs of MA (2) (premiums)

cost compared to medicare + supplemental insurance

Back 22

People who enroll in a MA plan must pay the Part B premium plus any extra premium charged by the MA plan.

Typically premium you pay extra for MA Is less than what you pay for supplemental insurance

Front 23

MA premiums regulations and model

Back 23

Premiums are guaranteed issue and community rated.

Front 24

in IC...range of premiums for MA-PD

Back 24

0!! to 85$

Front 25

major reason that MA-PD can accrue less cost over time than medicare

Back 25

original medicare won't cap your out of pocket cost

Front 26

MA plan vs. medicare: differences (3)

Back 26

MA has less cost-sharing than original Medicare and cost-sharing typically is capped

MA plans may cover services not covered in original Medicare (e.g. dental, vision, or hearing coverage)

Front 27

pros of MA (6)

Back 27

Provides choice.
Has more comprehensive benefits than original Medicare.
Usually caps patient out of pocket expenses.
Premiums often are less than Medigap premiums.
More coordinated care (everything is linked to MA rather than medicare where you have separate plans)
Beneficiaries only have to deal with one plan (no separate drug plan and no supplemental coverage)

Front 28

cons of MA (4)

Back 28

-unstable market; plans leave medicare year to year as reimbursement changes, so often old people have to switch a lot
-restriction of providers- MA has a provider network and may or may not have coverage for stuff outside network
-choice of plans confusing
-some evidence that MA costs are higher than original medicare (og goal of MA is to save money)- but apples to oranges (different services covered in MA, different types of pt that enter MA- e.g sicker people stay in regular medicare)

Front 29

issues with original medicare (3)

Back 29

costs increasing rapidly, esp with baby boomers
even pt enrolled in A, B D have gaps in coverage
issues coordinating care for dual eligibles (people on medicaid + medicare)

Front 30

gaps in medicare coverage (3)

Back 30

Medicare does not cover most long term care costs.
Patient cost-sharing is substantial and in original Medicare is not capped.
Coverage gap in Part D (being phased out).

Front 31

Medicare Supplemental Insurance- what is it? where can you get it?

Back 31

private supplemental coverage (medigap) to cover for "holes"

-can get from former employee though this is eroding

Front 32

medigap coverage regulations (3) and why

Back 32

-to prevent fraud and abuse

-govt made standardized packages (12 plans A-L) to help seniors compare

Premiums generally may not be based on health status.

Generally have guaranteed eligibility

Front 33

medigap- type of payment plan (like community, the other ones...)

Back 33

modified community rating.

Front 34

huge problem in the Medigap plans with drug coverage
are MA-PD plans still popular?

Back 34

Since the Medicare drug benefit began in 2006, new Medigap policies with drug coverage may not be sold (was capped, expensive)

too much adverse selection (only people who needed a lot of drugs would sign up)

Front 35

major issue with medicare

why is it so hard to reform?

Back 35

increasing costs of Medicare and interest in Medicare reform.


old people freak the fuck out if you touch medicare

Front 36

5 ways of reducing costs from medicare

Back 36

raise age of eligibility
raise costs for high income beneficiaries (already happened- continue)
reducing covered services
reduce provider payments
make medicare a voucher program- going more to MA tract where you give beneficiaries a dollar amount and say you pay the difference for a private insurance plan

Front 37

medicare provider payments- leaning towards what model; "never events" what are they?

Back 37

shift toward pay for performance in medicare


original medicare no longer pays for "never events" (things that should never happen and that they will not pay for- and can't make pt pay for) like bedsores acquired in the hospital

Front 38

Upcoming pilot test of episode based payment - what is this about?

Back 38

where payment for inpatient and outpatient services is bundled (e.g. payment for AMI wtf? include post-discharge care instead of part A + part B) to prevent people being re-hospitalized from being released too early

Front 39

medicare - what are they doing for certain specific disease state issues (DME, diabetes)

Back 39

expanding a competitive bidding program for durable medical equipment

getting ready to roll out of a national competitive bidding program for mail order diabetes supplies

Front 40

medicare coverage decisions and their influence

Back 40

When Medicare decides whether a service will be covered, private insurance companies often follow their lead (See WSJ article on Provenge).