Sens. Chuck Schumer (D-N.Y.) and Max Baucus (D-Mont.) said efforts were under way to address concerns raised by senators, including the low reimbursement rates for hospitals and doctors.
“All of the problems that people have mentioned, we are mindful of,” said Schumer, who worked to develop the package with 10 moderate and liberal senators. “Every one you have mentioned has been brought up in our discussions, and we didn’t ignore any of them.”
The AP is also reporting that there is talk about “fixing” the reimbursement “problem.” The reason Medicare is such a cost-effective program is due to its ability to use its large size to negotiate very good rates. The lower reimbursement rates are a-cost controlling feature, not a bug. Remove that advantage, and Medicare buy-in becomes dramatically more expensive.
Now, if the “fix” was to just have this group of people reimburse providers at Medicare rates plus 5%, that would be a pure giveaway to the doctors and hospitals, but at least a workable program. If the “fix” were to use “negotiated rates,” that is when things all start falling apart. You can't really have negotiated rates with providers without allowing providers to opt-out of the Medicare buy-in program, but stay in the Medicare program. Given the small number of people able to use the program, it will not be able to negotiate rates that are nearly as good.
This change would result in this fake Medicare program having much higher premiums and a smaller provider network. It would also result in greater administrative overhead. This fake Medicare would lack almost all the benefits of Medicare. A Medicare buy-in program that does not actually allow people to fully buy into real Medicare is a farce. Beware: it looks like we are about to get fake Medicare for Christmas.
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