In an effort to assist recipients of federal insurance for the elderly and disabled in receiving the necessary medical care, the Biden administration is suggesting a new round of restrictions on private Medicare health plans, which have expanded to cover half of the Medicare population.
Medicare Advantage plans will have to put in more effort to urge members to take advantage of additional benefits that are available to them, as opposed to only mentioning them in sales pitches, as per a draught rule released by the federal Centres for Medicare and Medicaid Services on Monday.
The plan would also facilitate the purchase of biosimilars—less costly biologic medications derived from live cells or other organisms—by Americans eligible for Medicare prescription benefits.
Health and Human Services Secretary Xavier Becerra unveiled the idea at a news conference on Monday, saying that older Americans who choose Medicare coverage “should not be subject to practises playing fast and loose with marketing rules.”
The government is attempting to tighten regulation of Medicare Advantage, the private-sector form of Medicare that has seen a sharp increase in popularity, for the second time in a year with the proposed rule. A distinct set of regulations was put out by HHS late last year, with the primary goal of prohibiting insurance brokers and agents from engaging in predatory marketing tactics, such as false advertising, when they attempt to sell Medicare beneficiaries private Medicare health plans. In April, the rule was finalised.
Senior aides to President Biden are presenting the idea as a component of the “kitchen-table economics” that they hope will resonate with voters in the election that will take place in a year as he runs for reelection.
As a component of the same federal statute that brought prescription drug benefits to Medicare for the first time since the expansive insurance program’s founding in the 1960s as part of President Lyndon B. Johnson’s “Great Society,” Medicare Advantage was established in 2003. Medicare’s original form lets disabled individuals and those 65 and older pick their own physicians and pay monthly charges for outpatient treatment. The commercialised version’s managed-care plans frequently provide additional advantages that are well-liked by senior citizens, like vision and hearing aids; nevertheless, these plans typically limit participants to a more constrained network of medical professionals who have agreed to take on new clients.
The Republicans in control of both chambers of Congress demanded that the government pay the private plans more than the original Medicare reimbursement rates in order to entice more plans to participate in Medicare Advantage, which replaced a few earlier versions of managed-care Medicare.
The reward system has worked. According to KFF, a nonpartisan health policy organisation, the average Medicare beneficiary has a record number of options, with roughly 40 private Medicare health plans to choose from. Medicare Advantage enrollment represents slightly more than half of all Medicare beneficiaries for the first time this year, or nearly 31 million people with the private plans.
The Medicare that has been privatised has come under more and more scrutiny, even from Democrats in Congress, as its popularity has increased.
“This is a continuation of long-standing concerns about insurers’ aggressive marketing and market confusion,” stated Tricia Neuman, senior vice president of the health policy group KFF, which oversees its Medicare policy programme.
The proposed regulations would impose stricter limitations on the income of insurance agents and brokers who provide Medicare consumers with advice. They would also set a fixed amount for these consultations, regardless of the plan that the customer chooses. There are currently limitations in place, but some businesses give agents and brokers extravagant bonuses—like golf outings—in exchange for directing business to them, as White House National Economic Council director Lael Brainard disclosed to reporters on Monday during the briefing.
Furthermore, the proposed rule change would mandate that private health insurers inform individual Medicare beneficiaries of their remaining supplemental benefits midway through the year. An average private Medicare Advantage plan offers 23 health benefits not offered in standard Medicare, but utilisation is low, according to an HHS information sheet. According to the HHS document, the purpose of the idea is to “ensure that the large federal investment of taxpayer dollars in these benefits is actually making its way to beneficiaries and are not primarily used as a marketing ploy.”
A further aspect of the plan would mandate that private Medicare health plans increase the number of behavioural health professionals in offices and clinics, such as addiction treatment specialists and marriage and family therapists, in order to increase access to mental health services.
The recognised prescription benefits of Medicare Part D would also be impacted by the rule change. The plan would require prescription drug plans to assist patients in obtaining coverage for biosimilar medications more easily, which would go beyond existing federal regulations.
The annual Medicare enrollment period, which runs from mid-October to December 7, is when the proposed changes, which were unveiled on Monday, will be implemented. For sixty days, the plan will be available for public feedback. The final version would go into effect at some point in the following year, in time for the autumn 2025 Medicare enrollment season.