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H.R. 4789


H.R. 4789 … a true public option?
… or another example of many distractions.

See Dr. Don McCanne’s guidance at “Comments”, below,
and a very short Summary at the bottom.

(Copied from below:) “Playing with a Medicare buy-in is an unnecessary diversion at a time that we need to get serious about reform. We need to fix Medicare and expand it to cover everyone.”


About the “Public Option Act”
via Dr. Don McCanne’s QOTD of March 9, 2010

Grayson’s “Public Option Act” or “Medicare You Can Buy Into Act”

Grayson Introduces Public Option Act

Congressman Alan Grayson
Press Release
March 9, 2010

Congressman Alan Grayson, D-Fla., today introduced a bill (H.R. 4789) which would give the option to buy into Medicare to every citizen of the United States. The “Public Option Act,” also known as the “Medicare You Can Buy Into Act,” would open up the Medicare network to anyone who can pay for it.

Congressman Grayson said, “Obviously, America wants and needs more competition in health coverage, and a public option offers that. But it’s just as important that we offer people not just another choice, but another kind of choice. A lot of people don’t want to be at the mercy of greedy insurance companies that will make money by denying them the care that they need to stay healthy, or to stay alive. We deserve to have a real alternative.”

The bill would require the Secretary of Health and Human Services to establish enrollment periods, coverage guidelines, and premiums for the program. Because premiums would be equal to cost, the program would pay for itself.

“The government spent billions of dollars creating a Medicare network of providers that is only open to one-eighth of the population. That’s like saying, ‘Only people 65 and over can use federal highways.’ It is a waste of a very valuable resource and it is not fair. This idea is simple, it makes sense, and it deserves an up-or-down vote,” Congressman Grayson said.

http://grayson.house.gov/News/DocumentSingle.aspx?DocumentID=175363

H.R. 4789 - “Public Option Act” or “Medicare You Can Buy Into Act”:
http://thomas.loc.gov/ Click Bill Number. Enter H.R. 4789.
Click Search. From there you can access the text of the legislation (very short bill), cosponsors, and other information.

Video of Grayson’s introduction of H.R. 4789 to House (5 minutes):
http://www.huffingtonpost.com/2010/03/10/grayson-offers-medicare-b_n_492831.html

Article XVIII, Sec. 1818
http://www.ssa.gov/OP_Home/ssact/title18/1818.htm

Article XVIII, Sec. 1818A
http://www.ssa.gov/OP_Home/ssact/title18/1818A.htm

Medicare premiums for 2010
http://questions.medicare.gov/cgi-bin/medicare.cfg/php/enduser/std_adp.php?p_faqid=2260 Comment:

Comments

Note: bolding and items in (parentheses) have been added

By Don McCanne, MD

Throughout the reform process members of Congress have been fighting over whether or not the reform legislation should include the option of purchasing a government-sponsored plan through the proposed insurance exchanges - the so-called “public option.” Since Congressman Alan Grayson introduced the “Public Option Act” or “Medicare You Can Buy Into Act” three days ago, a wave of enthusiastic support has been generated based on the perception that this is the perfect solution. Today’s comment briefly discusses this legislation, and it will sound really great at first blush, but do not draw any firm conclusions until you read through to the end.

Okay. What does this bill do? It … allows any legal resident of the United States under age 65 to buy into Medicare. The program will be paid for by the premiums to be collected from the individuals purchasing the coverage. Six age brackets are established for purposes of pooling funds. This reduces the financial burden on younger, healthier individuals by requiring older individuals to pay the higher premiums that would be required to fully fund their less healthy risk pool.

Many are not aware of this, but Medicare already has a buy-in program. Under Title XVIII, Sec. 1818, individuals over 65 who have fewer than 40 quarters of Medicare-covered employment who would otherwise not be eligible for Medicare can still participate by paying a full premium for Part A coverage (hospital) or a reduced premium if they have 30 to 39 quarters of Medicare-covered employment. Likewise, under Sec. 1818A, disabled individuals whose entitlement ends due to having earnings that exceed the qualification level can also purchase Medicare Part A. Grayson’s bill adds a new Sec. 1818B to Title XVIII to expand the buy-in option to anyone under 65.

For 2010, the premium under Sec. 1818 and Sec. 1818A to buy into Medicare Part A is $461 per month. The premium for Part B (supplemental medical) is the same as for qualified retirees - $110.50 and up, based on income (ignoring the hold harmless exception). Thus the buy-in is about $571 per month, or more for those with higher incomes.

Although Medicare beneficiaries have a high rate of chronic disease plus the costs of end-of-life care, the risk pool is diluted with a very large number of healthy seniors, thus the premiums are not as high as one might think. On the other hand, it is likely that the risk pools for the older but still under 65 age groups in the Grayson proposal would be subject to adverse selection. Since the premiums must pay all costs, they may be higher, perhaps much higher, than the (much more) diluted post 65 risk pool. Grayson has not included any risk adjustment mechanism to compensate for this.

At any rate, the Grayson proposal seems to be the true public option, run by the government, that progressives have been fighting for. So what could be wrong with it?

The greatest concern of all is that it still does not fix our outrageously expensive, administratively wasteful, highly inequitable, fragmented method of financing health care. It merely provides another expensive option in our very sick system of paying for health care. Providing yet one more option that people can’t afford really hasn’t moved the process.

(We Don’t Want Medicare; We Want Improved Medicare for All.) Although Medicare is a very popular program, it is highly flawed. It has an oppressive central bureaucracy. It fails to use more efficient financing systems such as global budgeting for hospitals and negotiation to obtain greater value in health care purchasing. There are serious questions about whether Medicare funds are being distributed equitably and in a manner to promote greater efficiency. Its benefit package is relatively poor, covering only about half of health care costs for our seniors. Most Medicare beneficiaries feel that they essentially are forced either to purchase Medigap plans, which provide the worst value of all private health plans, or to enroll in Medicare Advantage plans, which waste too many tax and premium dollars. It would be both much less expensive for all of us and better for Medicare beneficiaries if the extra benefits of these private plans were rolled into the traditional Medicare program. Part D should be stripped of its private market administrative and profit excesses and also be rolled into the traditional program. Medicare also has failed to introduce beneficial innovative programs such as the British NICE system, which would improve both quality and value in our health care.

(CHALLENGE expressed by Dr. McCanne.) For those who say that a Medicare buy-in is an incremental step towards health care utopia, explain precisely how that is going to work. Explain each problem that it solves. Explain how it is going to morph into a universal or near universal system in which each individual is paying the full actuarial value of the coverage. It won’t happen.

Playing with a Medicare buy-in is an unnecessary diversion at a time that we need to get serious about reform. We need to fix Medicare and expand it to cover everyone. Nothing less will do.


The Content of H.R. 4789

111th CONGRESS

2d Session

H. R. 4789

To amend title XVIII of the Social Security Act to provide for an option for any citizen or permanent resident of the United States to buy into Medicare.

IN THE HOUSE OF REPRESENTATIVES

March 9, 2010

Mr. GRAYSON (for himself, Mr. FILNER, Mr. POLIS of Colorado, Ms. PINGREE of Maine, Ms. SHEA-PORTER, Ms. SCHAKOWSKY, Mr. FRANK of Massachusetts, Mr. KUCINICH, Ms. EDWARDS of Maryland, Ms. WATSON, and Ms. JACKSON LEE of Texas) introduced the following bill; which was referred to the Committee on Ways and Means

A BILL

To amend title XVIII of the Social Security Act to provide for an option for any citizen or permanent resident of the United States to buy into Medicare.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,


SECTION 1. SHORT TITLE.

  • This Act may be cited as the Public Option Act' or theMedicare You Can Buy Into Act’.


SEC. 2. UNIVERSAL MEDICARE BUY-IN OPTION.

  • (a) In General- Part A of title XVIII of the Social Security Act is amended–

    • (1) in section 1818(a), by striking or 1818A' and inserting, 1818A, or 1818B’; and

    • (2) by inserting after section 1818A the following new section:

  • `UNIVERSAL BUY-IN

  • `Sec. 1818B.

    • `(a) In General- (a) Every individual who–

    • `(1) is a resident of the United States;

    • `(2) is either (A) a citizen or national of the United States, or (B) an alien lawfully admitted for permanent residence; and

    • `(3) is not otherwise entitled to benefits under this part or eligible to enroll under this part;

    • shall be eligible to enroll in the insurance program established by this part. An individual may enroll under this section only in such manner and form as may be prescribed in regulations, and only during an enrollment period prescribed in or under this section.

    • `(b) Enrollment; Coverage- The Secretary shall establish enrollment periods and coverage under this section consistent with the principles for establishment of enrollment periods and coverage for individuals under section 1818, except that no entitlement to benefits under this part shall be effective before the first day of the first calendar year beginning after the date of the enactment of this Act.

    • `(c) Premiums-

    • `(1) IN GENERAL- The provisions of subsections (d)(1), (d)(2), and (d)(3) of section 1818 insofar as they apply to premiums (including collection of premiums) shall apply to premiums and collection of premiums under this section, except that–

      • `(A) paragraphs (4) and (5) of section 1818 shall not be applicable; and

      • `(B) the estimate of the monthly actuarial rate under section 1818(d) shall be computed and applied under this paragraph based upon costs incurred for individuals within each age cohort specified in paragraph (2) rather than for all individuals age 65 and older.

    • `(2) AGE COHORTS- The age cohorts specified in this paragraph are as follows:

      • `(A) Individuals under 19 years of age.

      • `(B) Individuals at least 19 years of age but not more than 25 years of age.

      • `(C) Individuals at least 26 years of age and not more than 35 years of age.

      • `(D) Individuals at least 36 years of age and not more than 45 years of age.

      • `(E) Individuals at least 46 years of age and not more than 55 years of age.

      • `(F) Individuals at least 56 years of age and not more than 64 years of age.

      • `(d) Treatment- An individual enrolled under this part pursuant to this section shall not be treated as enrolled under this part (or any other part of this title) for purposes of obtaining medical assistance for medicare cost-sharing or otherwise under title XIX.’.

END

Sources and Additional Information

PNHP QOTD of 3/9/2010.

About H.R. 4789
H.R. 4789 at the Library of Congress
Cosponsors
Congressional Actions



SUGGESTION: use Dr. McCanne’s Quote-of-the-Day [QOTD] service as a source of information for keeping up-to-date regarding U.S. health care policy, especially regarding the single-payer movement.





Summary:

We’ve had many unnecessary diversions and disgressions.
H.R. 4789 is one more.

LET’S STAY FOCUSED on our …
Mission, Vision, Strategy, and Plan
to get Improved Medicare for All.




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