According to an issue brief recently published by the Heritage Foundation, wealthy seniors should pay more in Medicare premiums. Taxpayers spend an extra $4,897 per Medicare beneficiary beyond what is collected in taxes and premiums. Currently, Medicare beneficiaries pay a basic premium for Part B of $99.90 per month, which covers some costs while the remaining costs are covered by subsidies from the general revenue. The subsidy declines for married seniors with combined income above $170,000. When a senior’s income reaches $428,000, the premium tops out at $319.70 per month, leaving a 20 percent subsidy. According to the report, a retired couple with a $428,000 combined salary would have total financial assets worth more than $7.1 million, excluding the value of their home. In other words, this means that multimillionaire retiree seniors still qualify for a 20 percent Medicare subsidy. The report explores this issue and suggests eliminating premium subsidies for such high income Medicare beneficiaries.

The Kaiser Family Foundation recently released an issue brief which compares the expected value of benefits for individuals ages 65 and older under Medicare's fee-for-service program to two "typical" plans offered by large employers: a typical large employer preferred provider organization (PPO) plan and the Blue Cross/Blue Shield Standard Option for enrollees in the Federal Employees Health Benefits Program (FEHBP), also a PPO plan. The analysis updates a 2008 Kaiser Family Foundation report that found...

According to a new Government Accountability Office (GAO) report, Medicare is spending $8 billion on an experimental program that rewards providers of less than stellar health care. The report recommends that the Obama administration cancel the demonstration program, which pays bonuses to health insurance companies caring for millions of Medicare beneficiaries. The administration defended the project, arguing that it could improve care quality for older Americans. The Affordable Care Act (ACA) cut Medicare payments to managed care plans, known as Medicare Advantage (MA), and authorized bonus payments to those that provide high-quality care. However, the GAO letter reports that the majority of the money paid under the demonstration program went to “average-performing plans” rated lower than Congress's benchmarks. GAO reported that the project would cost $8.35 billion over 10 years, with 80 percent of the cost occurring in the first three years. Although the project dwarfs other Medicare demonstrations in its budgetary impact, the GAO report found that the project is so poorly designed that researchers could not determine whether the bonus payments correlated with improved care. As a result, the report argues, the project is unlikely to produce meaningful results. Currently, over 12 million Americans are enrolled in MA plans. About one-third of them are in plans that would receive bonuses under the original ACA. Under the demonstration project, 90 percent are in plans eligible for bonuses. Another report released the same day by...

The Urban Institute, funded by the Robert Wood Johnson Foundation (RWJF) recently released, "The Center for Medicare and Medicaid Innovation: Activity on Many Fronts," which explores the first year of operation of the Center for Medicare and Medicaid Innovation (CMMI). The paper argues that although CMMI has a long list of accomplishments, some observers express concern that its fast-paced approach may be overwhelming to smaller delivery systems. The paper provides a comprehensive review of CMMI's activities to date, including a survey of the goals envisioned by Congress. The authors address CMMI's major initiatives, including those that address primary care redesign, bundled payments, ACOs, dual-eligible beneficiaries, and the health care system’s capacity for spreading innovative ideas.

The Commonwealth issue brief, "Identifying, Monitoring, and Assessing Promising Innovations: Using Evaluation to Support Rapid-Cycle Change," reviews the mission of The Center for Medicare and Medicaid Innovation (Innovation Center) and provides perspectives from the research community on critical issues and challenges. This issue brief focuses on three requirements the Innovation Center must address to meet its objectives: 1) focusing on research-based changes that have the potential to achieve significant impact on improving quality and lowering costs; 2) documenting innovation testing and goals and tracking implementation and performances; and 3) generating evidence requisite to support broad-based policy change. To support these goals, the Affordable Care Act (ACA), has provided the Innovation Center with $10 billion in funding from 2011 to 2019. The intent is to allow quicker and more effective identification and spread of desirable innovations, with the goal of ultimately modifying Medicare, Medicaid, and the Children's Health Insurance Program (CHIP).

A key provision of the Affordable Care Act (ACA) is the establishment of the Medicare Shared Savings Program, which provides incentives for improved quality and efficiency in a new category of provider--the accountable care organization (ACO). The ACO program is slated to begin in January 2012 and will reward groups of providers who agree to collaborate and offer more accountable, effective, and efficient care with a share of the savings that they achieve. The Commonwealth Fund Commission on a High Performance Health System's report "High Performance Accountable Care: Building on Success and Learning from Experience," provides recommendations for ensuring effective, efficient implementation and growth of the ACOs. Specifically, this report 1) sets forth the rationale for creating ACOs; 2) describes several promising types of ACO models that should be considered and evaluated as part of an effort to facilitate adaptability and spread of accountability for quality and cost; and 3) concludes with a set of Commission recommendations on what ought to be expected from ACOs and how to ensure their successful implementation and spread.