Donald Trump delivered a campaign-rally style speech to a large retirement community, The Villages, in Florida last week in which he briefly outlined an executive order he has signed for Medicare reform. The executive order titled “Protecting and Improving Medicare for Our Nation’s Seniors” focuses on bolstering Medicare Advantage plans sold by private insurers. Now that the dust has settled around the evocative speech, it’s time to look at the pros and cons of how this executive order could change Medicare as a whole.
About Medicare Advantage
Medicare Advantage plans are already very popular with about 40 percent of all Medicare beneficiaries enrolled in one, and that number grows each year. Going into 2020, Medicare Advantage plans seem even more appealing—plan options are up, premiums are down, and Medicare Advantage is expanding its definition of healthcare to cover more benefits.
Many plans already cover additional benefits not covered by Original Medicare, like dental, vision, and hearing care, hence the high enrollment.
In an attempt to address “whole-person health,” some Medicare Advantage plans are adopting (or already offer) the following benefits:
- Non-emergency transportation to medical appointments through Lyft or Uber
- Palliative care
- Home-delivered, healthy groceries
- In-home aids
- Air conditioners for beneficiaries with asthma
- Coverage of Apple watches
- Adult daycare
- Respite care for caregivers
- Stair rails
- Temporary ramps
Benefits vary by plan, so call your insurer directly for specific coverage questions.
Medicare Advantage plans look very appealing from the outside, but Trump’s executive order could completely change the way Medicare works as a whole—Medicare Advantage plans included.
Potential cons include:
- Out-of-pocket Medicare costs could go up.
- Fewer doctors may accept Medicare beneficiaries and opt out of the program.
- Beneficiaries could be exposed to balance billing practices (or expensive, surprise medical bills) which have been historically controlled by Medicare.
- Medicare Advantage plans have more rules, like prior authorizations.
- Medicare Advantage plans have more limited networks of doctors and hospitals.
- Some Medicare Advantage plans have recently been found guilty of defrauding the government by $10 billion annually, increasing taxes for all working Americans.
- Without a flat fee paid by Medicare, doctors may pick and choose which patients to treat depending on how much money they can make.
- Doctors may be encouraged to open “boutique” practices in which they don’t deal with insurance at all, and mainly cater to high-income patients who can afford to pay cash.
The executive order also called for the removal of “unnecessary barriers” to private contracting, which would allow patients and doctors to negotiate and strike deals outside of Medicare. However, this could put patients at a massive disadvantage if they don’t have strong negotiation skills.
Former Representative Pete Stark (D-CA) found this idea so absurd when it was first proposed in the late 90s, he put forth the “No Private Contracts To Be Negotiated When the Patient Is Buck Naked Act of 1997.” In other words, during a negotiation for which medical treatments should be covered and to what degree, the doctor would hold all the power, or be “fully clothed.”
Specifics will not emerge until the Department of Health and Human Services (HHS) can write and find a way to implement rules of the executive order, which can take six months or longer. This means that the order may never go into effect if Trump is impeached and removed from office.