Traditional Medicare Insurance Model

992 Words 4 Pages
When the Medicare program was established in 1965 its core principle was equal health insurance benefits for all individuals who were 65 years or older and the disabled regardless of income. Today more than 41 million elderly and disabled Americans receive coverage through Medicare. Medicare Part A covers hospital stays, Medicare Part B covers doctor’s office visits; both insurance plans follow the traditional insurance model. Medicare Part C is originally known as Medicare+Choice (M+C) is referred to as a Medicare Advantage plan follows a managed care insurance model.
Medicare Advantage plans are Medicare approved private health insurance plans that can be used by individuals enrolled in the Original Medicare A & B coverage. Medicare Advantage
…show more content…
With a cost of about $269 billion annually, the Medicare program is now the second most expensive federal domestic program. It is very important for the Medicare program to begin the process of finding ways cut costs, while still sustaining the program and making it affordable to qualified individuals who are likely on a fixed income. One suggestion that will be explored in this paper is the idea of switching the entire Medicare program from the traditional insurance model to the managed care model which is currently only available with Medicare Part C.
Firstly, one will need to thoroughly review Medicare C Medicare Advantage plans; this analysis will review what benefits have been realized by Federal government, providers, and ultimately patients since implementation. Seeing that Medicare Part C is currently using the managed care insurance model, it is time to take a closer look at its structure, along with its advantages and disadvantages. Expanding on the preceding statement will allow one to have the appropriate information to make an informed
…show more content…
Seeing that the managed care insurance model is basically a direct opposite of the traditional insurance model, and transfers the burden of ever-changing healthcare statistics to the private insurance companies; this could eventually lead to rebellion on the part of the insurance companies and health practitioners. The Affordable Care Act signed into congress by president Barack Obama aimed at cutting Medicare payments to advantage plans clearly shows the necessity. “The Affordable Care Act cut $716 billion from Medicare to fund Obamacare, including $176 billion of cuts affecting the Medicare Advantage program that nearly 18 million seniors rely on for coverage” (Brufke, 2016). Another disadvantage is overspending and rates. With the managed care insurance model, it is entirely possible for the Federal government to inaccurately represent or decide what the appropriate fee for each Medicare enrollee should be or appropriate payment amounts per claim. According to an article by Schulte et al; “Government officials have struggled for years to halt health plans from running up patient risk scores and, in many cases, wresting higher Medicare payments than they deserve, records show” (Kaiser Foundation). If the Medicare fee per enrollee paid to the private health insurance company is too low, this will ultimately cause a deficit for the Federal government and ultimately tax

Related Documents