Republicans are trying a defense in the primary on Medicare

Republicans are furious at the suggestion that their call for unspecified spending cuts, which they have made conditional on raising the national debt ceiling, means they are actually trying to cut Medicare and Social Security.

That could be seen quite clearly during his State of the Union address last week, when President Joe Biden said several Republicans called for cuts to the two entitlement programs. Several Republicans called out Biden, calling him a liar – year TASK they repeated in countless editorials, speeches and interviews both before and after.

We paid particular attention to the Medicare debate as it covers health care. I haven’t seen any polls specifically on the Medicare cuts issue, so I can’t say for sure if these Republican protests are playing well with the public.

But I’m guessing they’re not, given the intensity of the GOP backlash — and a new argument they’re trying now. They say Democrats are trying to cut Medicare, not Republicans.

It started as a talking point among GOP officials and has now become the focus of ads the Senate Republican National Committee has launched against Democrats. (You can see one here if you want.)

If you think the GOP argument sounds like a slightly more sophisticated version of “I’m rubber, you’re glue; whatever you say, it jumps on me and sticks to you,” then you are not alone.

And if you’re skeptical of their claim, you have good reason to be.

The argument Republicans are making is actually about Medicare Advantage plans, which are private insurance policies that seniors can choose instead of the traditional government program.

If you choose one of these plans, the federal government will pay the insurance company that administers the plan. The insurer will then pay the medical bills.

Private versions of these Medicare plans have been around for decades, but they really took off in the mid-2000s. In total, more than 28 million Americans were in Medicare Advantage plans, about half of the Medicare population. Projections suggest the number will continue to rise.

It’s a big change and a significant victory for conservatives, who have long supported private alternatives to government health insurance — or any government program, for that matter.

The federal government is constantly recalibrating how it pays insurers based on analyzes of their performance and finances. Over the years, this type of analysis has repeatedly shown that the government pays too much for what the plans actually provide to beneficiaries.

One reason is the well-documented problem of “upcoding,” which is essentially insurers using the payment system to get extra money that’s supposed to compensate them when they take on beneficiaries with worse health conditions. And while there is (some) evidence that Medicare Advantage plans outperform traditional Medicare when it comes to supporting preventive care, there is also well-documented evidence of this. New York Times article – who refuse essential care more often.

The changes to Medicare Advantage payments come from the Department of Health and Human Services, which today is under the leadership of the Biden administration. In January, it announced a series of adjustments that it expects will work, on average, for plans that will get a 1 percent increase per patient in 2024.

And now we come to the first major contention.

An organization called Better Medicare Alliance commissioned its own analysis, independent actuarial firm Avalere, which concluded that the proposed payment changes would effectively mean a 2.27% reduction.

“We are confident that this proposal will lead to unprecedented reductions in Medicare Advantage for older adults and people with disabilities,” Mary Beth Donahue, president of the Alliance, told me Friday.

Don’t worry, readers, I won’t contain that statement here. It’s a highly technical topic involving benchmarks, risk scores and (have you noticed yet?) regional adjustments.

Avalere is a respected firm with many reputable analysts. He also performed this work on a contract basis for the alliance, whose members include CVS/Aetna, Humana and UnitedHealth, three of the largest providers of Medicare Advantage plans. Humana and UnitedHealth alone account for nearly half the market.

(Donahue confirmed that more than half of the alliance’s funding comes from insurance plans.)

Whether the administration’s proposed changes will result in a 1 percent increase, a 2.27 percent decrease, or somewhere in between, there is a separate question of whether those changes result in benefit changes. The alliance says it will — that if insurers get less money, they’ll be forced to cut benefits the plans offer.

In practice, this would most likely mean reducing some of the additional benefits in Medicare Advantage plans, such as routine vision or dental coverage, that traditional Medicare does not cover. These benefits are what make Medicare Advantage attractive in the first place.

“These policy changes add up to an average of $540 in new costs for beneficiaries next year,” Donahue said, citing a figure from Avalere’s analysis. “It’s very, very dramatic.”

But many experts are skeptical that the plans will reduce benefits substantially or at all.

“There is not much evidence to suggest that payments below the MA will necessarily lead to lower benefits for beneficiaries or higher premiums,” Riccardo Kronickan economist at the University of California, San Diego and one of the nation’s leading experts on Medicare Advantage told me

His interpretation is consistent with the results of a short short on the subject KFF extension, the California-based non-profit health care research and analysis organization. The KFF summary notes this past experience as well as the recent analyzes of non-partisans Medicare Payment Advisory Commission (MedPac) suggests that plans typically respond to cutbacks by reducing administrative expenses or profits.

And to be clear, they have a lot of profits to cut. Medicare Advantage is now the most profitable line of business for health insurers.

“My view of the evidence is that reductions in payments to Medicare Advantage plans are largely driven by the plans themselves, both through lower profits and cost reductions,” Matthew Fiedler, senior research fellow at the Brookings Schaeffer Initiative for Health Policy at the University of Southern California. , She said Political fact this week.

Fiedler served in the Obama administration, as did Kronick. And not all experts were so skeptical. Joseph Antos, an economist at the American Enterprise Institute, told Politifact that he believes the cuts could lead to benefit cuts. But he didn’t say they would be drastic either.

Debates like these are common, and not just in health policy. Industries are constantly fighting with the federal government over how much money they should receive to provide various services.

This year, however, routine requests from health insurers have been met with desperation from GOP leaders to downplay (or distract from) examples of Republicans like the senator. Rick Scott (R-Fla.) or House Republican Study Committee explicitly asking for Medicare cuts.

The GOP argument, which many conservative intellectuals embrace, is that any reduction in what the federal government sends to Medicare is a “cut.” Therefore, potentially reducing payments to Medicare Advantage or, for example, using the government’s bargaining power to reduce what Medicare pays drug companies is essentially the same as raising the eligibility age (as proposed by the Republican House Committee on Study) or by applying to the program to obtain a new authorization from Congress. every five years (as Scott suggests).

But there is a difference between the two approaches. What Democrats are proposing is an effort to run the program differently, not to change its core commitment to older adults and people with disabilities. “I don’t think these are equivalent changes at all,” Kronick said.

University of Southern California economist Paul Ginsburg echoed a similar sentiment, telling Politifact that the Biden administration’s proposed payment changes are about “managing the program better and more effectively to protect the integrity of federal funds.” used for it”.

Whether that distinction matters to the public is, of course, a separate question and depends on how the debate plays out in the coming weeks. White House press secretary Karine Jean-Pierre asked a question about the issue during Friday’s briefing, shortly after Scott clarified that his request to have federal programs subject to regular reauthorization every five years does not include Medicare.

You might take this statement as a sign that Scott truly believes that Medicare is sacrosanct and always has. Or you can take it as a sign that he senses the political vulnerability of his position as well as the rest of his party.