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Asclepios
Your Weekly Medicare Consumer Advocacy Update
Controlling Costs
February 7, 2008, Volume 8, Issue 6
The cost of health care is rising faster than our ability to pay for it.
The average health insurance premium for an American family has increased 91
percent in the last 7 years, from $6,351 to $12,106. During the same time
period, incomes increased just 12 percent. Additionally, 17.8 million Americans
with health insurance will spend more than a quarter of their pretax income on
health care costs. And 47 million people in this country have no health
insurance.
The cost of health care, private insurance, as well as Medicare, which covers
older adults and people with disabilities, and Medicaid, which covers the poor,
is also rising faster than our economy is growing.
Just as a family has to make sacrifices to pay their skyrocketing premiums and
copayments, as a society, we will have less money to spend on other things as
health care takes an ever bigger slice of the economic pie.
So, even as we recognize the value to our families and our society of paying
for health care--it helps keeps us alive and healthy, after all--it is a good
idea to look for ways to restrain its rising cost.
Health care costs are much higher per person in the U.S. than in countries that
provide coverage through a national program. Private insurance companies in
this country take a big cut, both in profits and added administrative costs,
and they do not have the same ability as national governments to negotiate
lower prices, for example, on prescription drugs.
But costs are rising everywhere and the chief reason, according to the
Congressional Budget Office, is wider use, and growing cost, of medical
technology. Much of this technology--drugs, devices and high-tech procedures
and diagnostic tests--represents real advances in care, curing or controlling
disease and allowing people to live longer, fuller lives. Other "advances" in
health technology do little, or nothing, to improve care over existing, less
expensive treatments or tests. Pharmacy shelves are filled with "me-too"
brand-name drugs that are profitable for their manufacturers but are no better
for patients than generics that cost a fraction of the price.
At present, however, it is difficult for doctors, patients or payers like
insurance companies or Medicare to know which is which. What we need is solid
research that compares the effectiveness of alternative drugs, devices and
procedures in combating illness and extending and improving the lives of
patients. Such research requires independence from the drug and device
manufacturers; it requires money; and it requires a mandate from Congress
establishing a body to conduct or oversee the research.
That is the first step and one that Congress can take this year. The next step
is to get Medicare to pay for care based on which treatment the research shows
works best.
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Medical Record
"The Medicare program has not taken costs into account in determining what
services are covered and has made only limited use of data on comparative
effectiveness in its payment policies; but if statutory changes permitted it,
Medicare could use information about comparative effectiveness to promote
higher-value care. For example, Medicare could tie its payments to providers to
the cost of the most effective or most efficient treatment. If that payment was
less than the cost of providing a more expensive service, then doctors and
hospitals would probably elect not to provide it--so the change in Medicare's
payment policy would have the same practical effect as a coverage decision"
("CBO Testimony: Statement of Peter R. Orszag, Director, on Growth in Health
Care Costs Before the Committee on the Budget, United States Senate
(http://www.kintera.org/TR.asp?a=bfIMKZNCKcIIL5K&s=qjL3JcNJKbLWL7NSE&m=ktKRL2MRJpK6G),"
Congressional Budget Office, January 31, 2008).
"This is why we believe so strongly in the need for a Marshall Plan-like
commitment to transform our knowledge base about the comparative effectiveness
of medical treatments to fill the gaps in the clinical research. Armed with
this knowledge, providers and consumers could identify and choose the best
treatment options, and payers could fine-tune benefit packages and modify
cost-sharing amounts to encourage the most cost-effective care" ("Statement of
Gail Shearer, Director, Health Policy Analysis, Consumers Union, Before the
Subcommittee on Health of the House Committee on Ways and Means
(http://www.kintera.org/TR.asp?a=esJSK8OOIfLPJfJ&s=qjL3JcNJKbLWL7NSE&m=ktKRL2MRJpK6G),"
House Committee on Ways and Means, June 12, 2007).
"Our analysis paints a stark picture: Nearly one out of four Americans under
the age of 65--61.6 million people--is in a family that will spend more than 10
percent of its pre-tax income on health care costs in 2008. Shockingly, the
vast majority of these people (82.4 percent) have health insurance. And 17.8
million non-elderly Americans--more than three-quarters of whom have health
insurance--are in families that will spend more than 25 percent of their
pre-tax income on health care costs in 2008" ("Too Great a Burden: America's
Families at Risk
(http://www.kintera.org/TR.asp?a=hlLYLhM0LiKWLpI&s=qjL3JcNJKbLWL7NSE&m=ktKRL2MRJpK6G),"
Families USA, December 20, 2007).
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Medicare Part D Appeals Help for Advocates Is Here!
MRC's new Medicare Part D Appeals: An advocate's manual to navigating the
Medicare private drug plan appeals process offers an easy-to-understand,
comprehensive overview of the entire appeals process, including real-life case
examples, a glossary of important appeals terms, a sample protocol for
advocates, and links to important resources.
Register for a FREE copy
(http://www.kintera.org/TR.asp?a=aeJKIWNyFbJJJ5K&s=qjL3JcNJKbLWL7NSE&m=ktKRL2MRJpK6G)
of this great resource.
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Medicare Private Health Plan Monitoring Project
The Medicare Rights Center (MRC) would like to hear about your experience, or
that of someone you know, enrolled in a private health plan. With information
about what the issues are with Medicare Advantage plans, we will be able to
demand that those problems be fixed.
Submit your story at www.medicarerights.org/maplanstories.html
(http://www.kintera.org/TR.asp?a=dhKQI5OKLeIQKfJ&s=qjL3JcNJKbLWL7NSE&m=ktKRL2MRJpK6G).
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The Louder Our Voice, the Stronger Our Message
Asclepios--named for the Greek and Roman god of medicine who, acclaimed for his
healing abilities, was at one point the most worshipped god in Greece--is a
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The Medicare Rights Center (MRC) is the largest independent source of Medicare
information and assistance in the United States. Founded in 1989, MRC helps
older adults and people with disabilities get high-quality, affordable health
care.
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