View Full Version : The next healthcare battle: Cutting Medicare Advantage

08-20-2009, 09:59 AM
The program gives private insurers a federal subsidy to handle seniors' care. Some swear by it, but others say it's wasteful.

President Obama, struggling to discredit bogus charges that his healthcare overhaul would create "death panels," soon could face another emotionally charged obstacle -- a plan to trim the federal subsidy for a program used by nearly a quarter of Medicare beneficiaries.

The program, known as Medicare Advantage, pays insurance companies a hefty premium to enroll senior citizens and provide their medical services through managed-care networks.But whether the higher payments are worth it is a matter of dispute.Obama and many congressional Democrats see Advantage as a wasteful bonanza averaging about $17 billion a year for the companies, which critics say provide few benefits beyond regular Medicare.

The companies and their supporters say they earn the extra payments by providing seniors -- who pay nothing extra -- with significant benefits, including freedom from government red tape.What lifts the disagreement above other points of contention on healthcare is its potential for spreading fear and outrage among Medicare recipients as a whole, much like the public outcry after Republicans accused Democrats of trying to create death panels to cut off care for severely ill seniors and the disabled.

The allegation, although untrue, fueled outrage among critics of the healthcare overhaul at town hall meetings across the country.Although scaling back payments would have no effect on a sizable majority of Medicare users, it would create an opening for opponents to make the blanket allegation that the president wants to cut back on Medicare benefits -- as some Republicans are already starting to say.