• Delays a reduction in Medicare reimbursement rates to doctors and replaces it with an increase
• Increases coverage for preventative health care under Medicare
• Makes mental health care more affordable
• Provides additional assistance to low-income beneficiaries
• Establishes an electronic drug prescribing initiative
• Makes cuts to the popular Medicare Advantage program to pay for Medicare changes

On July 15, 2008, Congress voted to override a presidential veto and pass H.R. 6331, the Medicare Improvements for Patients and Providers Act – making the most sweeping changes to Medicare since the creation of Medicare’s prescription drug benefit.

Most of the political debate surrounding the new law focused on efforts to delay a mandated 10.6% cut in reimbursements to doctors who provided services under Medicare. The law successfully replaces that cut with an 18 month increase in reimbursement rates of about 1%. This ensures that doctors will be able to afford to keep treating Medicare patients. Doctors are also encouraged to adopt new electronic prescribing, designed to limit medication errors, in order to receive even higher reimbursements. Those who do not adopt the changes are penalized down the road.

The new law also adds some valuable patient protections for Medicare beneficiaries. For example, the period for new Medicare beneficiaries to receive their “Welcome to Medicare” physical has been extended from 6 month to one year, and the cost of that physical will not count under the annual deductible. It is important to note that Medicare still will not cover the cost of an annual physical after the initial welcome period. The new law does give Medicare the ability to ad new preventative screening services as it sees fit. Initial expectations include weight-loss counseling and genetic tests for certain types of cancer.

Seniors with mental health conditions are also winners under the new law. The law reduces co-pays for mental health services from 50% to 20% and adds two new classes of mental health related drugs to Medicare Part D coverage – benzodiazepines commonly used for anxiety and barbiturates often prescribed as sleep aids.

The new law also provides help for senior in need. Medicare currently provides assistance to low income beneficiaries through a number of programs that are enhanced under the new law. Asset tests, meaning the amount of savings a senior can have and still qualify for assistance, were increased and no longer count necessary savings like the value of life insurance policies and income derived from charitable financial assistance programs. The law also eliminates the drug benefit penalty for low income seniors who fail to sign up in a timely manner.

Unfortunately, to pay for itself, the new law makes cuts to the popular Medicare Advantage program. It was these cuts that drew President Bush to veto the bill. Currently, more than 20% of Medicare beneficiaries are enrolled on Medicare Advantage plans that provide coordinated care and, often times, access to care and treatments not provided under traditional Medicare. Since their inception, Medicare Advantage plans have given seniors more options than just the one-size-fits-all traditional Medicare program. For seniors in this country, these choices, coupled with the advent of Medicare’s drug benefit, have led to better and more affordable health care.

RetireSafe believes that doctors should be compensated fairly by Medicare and that Congress needs to work toward permanently fixing the reimbursement structure outlined by law. We also believe that Medicare needs to continually improve by adding preventative screening, treatments and medicines to its coverage options. But paying for these improvements by taking away choices from seniors is not a good option and only serves to increase the government’s role in your healthcare. Reducing health care costs in this country is a noble goal, but RetireSafe believes we do that by having healthier patients and by ensuring that they and their doctors have choices and options.