Critics of President Obama’s rosy outlook on Medicare reform as part of the Affordable Care Act are pointing to the entitlement’s chief actuary as proof that his sudden realization of Medicare’s fiscal virtues under reform are peppered with politics. As recently as last weekend, Obama praised the almost half a trillion in savings over the next decade to the federal budget as not only the most fiscally responsible action the government has implemented as part of reform, but also as part and parcel of the overall commitment to the nation’s seniors with respect to the affordable access to healthcare.

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Two thousand ten just may go down as the year that Medicare is finally getting the recognition it deserves. Well, perhaps in a half-perverse way, anyway. The government entitlement program, which has just celebrated 45 years as the godfather of all payers in healthcare, continues to gain ink in an otherwise unrelated news cycle. President Obama appears to be taking credit for saving the program’s solvency singlehandedly, as his vision of healthcare reform would be far less vital without a provision to forming a leaner, meaner CMS.

In his weekly address to the American people, Obama reiterated his commitment to a program that is more “secure” than ever, a “commitment to America’s seniors” — never wavering from that core point. Obama will likely continue that same tenor as he campaigns for (some of the more vulnerable) Democrats in this year’s midterms, highlighting Medicare’s fiscal leanness with such tenacity, that to acknowledge that the country is still mired in a recession flirting with across-the-board double digit unemployment and ever-spiraling jobless claims is completely tangential.

At this stage, it is not clear how this gambit of Obama’s will play out in November, especially when wide swaths of the general population demographic — not just seniors — need the reassurance he continues to express on health reform as generalizable and essential to economic recovery in this country. All the while, the GOP will continue to hold up Obama’s enthusiasm for government’s role in Medicare as reason that 16% of this country’s GDP is one of the prime causes of the current economic disarray.

BC/BS Michigan is asking that state’s insurance regulators to vary the premium amounts on its Medigap supplemental offerings to seniors. It will ask state regulators to allow deeper discounts to low-income seniors while reducing the discounts on premiums for wealthier seniors. Medigap plans are standard insurance supplements to Medicare coverage offered only to beneficiaries with both Part A and B coverage.

Plans offered usually are the same; only the premiums can differ. All Michigan Blue Cross customers for the most popular of its Medigap policies now get a 39 percent discount off monthly premiums. The discount is distributed evenly to all Medigap policyholders, so that everyone pays just over $100.

It appears that with this move, the Michigan insurance marketplace is one of the first arenas in which states will negotiate with payers in the wake of expected cuts under Medicare Advantage offerings to fund reform over the next decade. | LINK

The Obama administration can take solace in some favorable news to become official later this week, as the annual Medicare and Social Security trustees report detailing the entitlement programs’ fiscal health becomes public. The report says that the budget will realize approximately $8B in savings at the dawn of reform, with a trajectory of almost a half a trillion in overall savings by the end of the 2010s.

Although not considered a particularly incendiary demographic with respect to Obama’s reform goals, the nation’s senior citizens have expressed concern over the solvency of Medicare over the next decade. It is safe to assume that the administration will use this news as a talking point to assuage those fears — in addition to running ads like this as a surrogate method.

Critics of the Obama admin’s plan to trim Medicare and Medicaid costs are quick to point out the presumed diversion of those implied savings into subsidies for the uninsured over the next decade — a move, they say, does nothing to retain solvency into the 2020s or save on healthcare costs in the long term. | LINK to report [PDF]

On Monday, Medicare (and Medicaid) turn 45. And to celebrate, the government will be touting its annual open enrollment. Well, okay, the feds will also be throwing in a plug for government’s role in health reform and what benefits are in store for those who were spring chickens when Medicare became law. Who better to message than the avuncular Andy Griffith?

Clearly targeted at those seniors who still think “death panels” are an essential creation of the Obama plan for reform, the ad — which begins airing in some markets today — will mostly focus on the benefits for seniors inherent in standalone or the program’s supplemental plans under reform. There will be no mention, however, of the major way the new reform law will maintain Medicare solvency well into the next couple of decades: trimming the fat from Medicare Advantage payouts from plans which originally saw benefit under the George W. Bush administration’s 2003 Medicare Modernization Act. | LINK

The fact that President Obama is naming Don Berwick, MD, CMS head via recess appointment shows his commitment to quality in healthcare delivery. It’s welcome news given that his drive for cost and access were the other cornerstones of recently passed reform legislation. Via the WH blog:

There’s no question that Don Berwick is the right choice to be our next CMS administrator: he’s the founder of the Institute for Healthcare Improvement and has spent decades as a practicing physician and a Harvard professor. He’s dedicated his career to finding ways to make our health care system work better for patients and cost less for taxpayers.

The choice of Berwick to fill this post is the perfect fit for an administration in search of the holy grail in healthcare delivery: quality. | LINK

Those who expected the state with the first-in-the-nation initiative to cover the health care of all of its citizenry will have to hold their collective breaths a little longer. The plans for an overhaul on how physicians and hospitals are paid for quality delivery are on hold as major parties cannot come to an agreement on how this metric should be implemented. Perhaps the thought of examining Massachusetts’ negotiated payment system as a relatively straightforward exercise in healthcare economics was a bit shortsighted.

Combine the complexities of fee-for-service government reimbursements with the intricacies of funding for coordinated care systems; the possibilities of funding an accountable care commission of sorts as a payment governing body; and the simple inertia that current levels of healthcare spending have created in a wasteful state system — and you’ve got a recipe for an overwhelming stalemate. There is a glimmer of hope that one faction’s action will get the legislative ball rolling on this issue: some hospital systems in the state plan to release details on the creation of governance to oversee spending in their ranks. | LINK

• It’s on. The mega union only needed 66%. They got over 80% ‘yea’. [LINK]
• At ninety days into the new reform law, Obama makes public safeguards inherent within. [LINK]
• FDA approves new diagnostic test that more rapidly detects antibodies and antigens. Excellent. [LINK]
• More controversy than there needs to be? The president’s pick to be new CMS chief engenders strong feelings on both sides [LINK]

Hospital executives who have worked with Dr. Berwick describe him as a visionary, inspiring leader. [..] Republicans are using the nomination to revive their arguments against the new health care law, which they see as a potent issue in this fall’s elections, and Dr. Berwick has given them plenty of ammunition. In two decades as a professor of health policy and as a prolific writer, he has spoken of the need to ration health care and cap spending and has confessed to a love affair with the British health care system.

Yep, November 2010 is shaping up to be a very interesting month.  The perfect storm surrounding the complexities of providing care to the aging uninsured is about to become a tsunami. The addition of millions of patients to the rolls of Medicare, the end of the six month reprieve on the implementation of enormous cuts, and the eye-opening intention of many medical providers to shorten their Medicare beneficiary bases will all combine to create healthcare’s version of the BP oil catastrophe.

Okay, that sentiment could be a little hyperbolic, but don’t discount the lingering animosity many physicians have for the lack of any government action on the way Medicare reimbursements are generated. Sure, there may be a six-month break before the inevitable occurs, but some providers have just had enough.

“I’m making a statement,” says Leah McCormack, a New York City dermatologist. “Many physicians are really being forced out of private practice.”

While hardly representative of the entire universe of physicians who see Medicare patients (some 97 percent according to CMS), it does encapsulate the sentiment being felt as many states’ medical societies as they report significant numbers of physician opt-outs. On the flip side, realistically, how many physicians can actually afford to leave Medicare — either via a moral stance or one out of necessity? Hopefully, patients will not have to find out. Healthcare access is an important part of President Obama’s reform agenda. The little-known (until now) inner workings of Medicare legislation will be taking front-and-center positions, as this latest wrinkle in healthcare reform gains more momentum for definitive action. And this time, the physicians are taking notice. | LINK

No sooner had the Senate’s stonewalling led to the expectation of the approval of deep cuts to Medicare reimbursements to physicians, a reversal of fortunes now has both Dems and the GOP agreeing on the so-called “doc-fix” compromise for which Finance chair Max Baucus has been advocating.

The $6.4 billion measure would reverse a 21 percent cut in physician payments that was to kick in Friday, raising the possibility that some doctors might begin to turn away those covered by Medicare.

To the GOP, this action means implementing yet another interim budget-neutral respite on the road toward Medicare payment . To the Democrats, it means saving face among healthcare reform advocates for another six months — just in time for the midterms. | LINK

If anyone needs any proof of how irrelevant the American Medical Association has become in its advocacy of the physicians the organization is supposed to represent, one needs look no further than in the last minute unexpected rejection of the postponing of cuts (21%) to Medicare reimbursement schedules. So much for being in the physicians’ corner on this issue. Senate Republicans essentially killed the measure via a vote along party lines. Initially, there was hope for a compromise fashioned at the eleventh hour by Max Baucus (D-MT) — one of the key figures in the establishment of many of the provisions set forth in the reform bill’s passage earlier this year.

The Senate had rejected a Finance Committee compromise^[1] that would have delayed the cut in Medicare payments to physicians until 2012, along with measures to extend unemployment benefits and provide $24 billion to states to cope with their Medicaid programs. Senate Republicans have apparently had enough — as CMS now has the greenlight to move forward on the cuts which were to have initially been implemented on June 1. This entire episode is a reminder of how serious matters are for primary care to sustain itself in a slowly recovering economy and increasingly prudent healthcare marketplace — which now, in a new reform-minded environment, has to manage to do more with less. The calling for innovation for the recruitment of primary care physicians has never been greater this century than as a result of this moment.

1. The compromise would have decreased the total cost to $118 billion and the overall deficit impact by some $20B;  it would have delayed the planned Medicare cuts and provided a 2% raise for physicians through November 30, rather than for the 19 months as part of the original bill. Essentially, the compromise would have amounted to a short term “fix” of the SGR — the method by which the cuts are computed in the face of increasing healthcare expenses by the government. [↩]

A year ago, Doctor Pundit highlighted the perennially contentious matter of Medicare payments to physicians. At that time, President Obama was about to realize the full-fledged partisan war to be waged on his ideas of healthcare reform. So far, in 2010, most of the president’s posturing on the issue has been to delay — on an apparent month by month basis — the presumptive rate in cuts in physician reimbursements that now stands at 21 percent. Obama’s rhetoric has largely been one of terming any Congressional effort to block reform in this area as “obstructionist” and “preventing any action” on payment “reform”.

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Beginning this week seniors should have already started receiving checks from the federal government for the purpose of closing the so-called donut hole — a provision of the MMA of 2003 that left many Medicare Part D beneficiaries out in the cold when trying to pay for their prescription drug coverage. People who fall into this gap are responsible for $3,610 in drug costs in 2010 before their Medicare coverage kicks in again. The “hole” is gradually being phased out over the next 10 years.^[1] Over 4 million people will receive $250 checks this year.

Sounds innocuous enough. But one state is asking the government to reclaim those funds. Vermont, which has some 2800 low-income seniors scheduled to receive the Part D refund checks, is asking beneficiaries to return the money. Since the state of Vermont is funding drug costs for its beneficiaries via public-funded insurance programs (OVHA), it is asking seniors to return the checks — as the state is on tap to receive almost $600,000 in rebates due to the action.

While the goal of the feds is to eliminate this troublesome provision as part of Obama’s healthcare reform package, this episode does highlight the difficulty some states have with federal mandates to cover certain costs associated with the delivery of healthcare when they essentially don’t agree with those mandates. By the way, if seniors decide not to refund the government’s money, says Vermont, they will be subject to a $250 deductible in their state-subsidized insurance plan for drug costs. | LINK

1. Next year, the rebates will be replaced with discounts that will increase each year until the gap is effectively eliminated in 2020. [↩]