You seem very interested in the details of the paper. May I suggest you read it? I cannot rehash it all on the blog. (My coauthors and I have already spent years conducting and refining the work and responding to numerous comments by reviewers.)

What you are missing is that for $1 of government payment (taxpayer dollars) consumers receive the value of $0.14. That’s free to them so why should they complain? (Rationally they should not.) But it is costing a lot and drives up Part B premiums for all beneficiaries as well. This is rather inefficient.

My point is that under MA plans, doctors may take on more patients under MA than they would under traditional Medicare because of higher reimbursements that are closer to private network rates. That would imply that they aren’t substituting private patients for traditional medicare patients but actually covering more Medicare patients in total. Thus Medicare Advantage is actually paying closer to the true cost of care for their subscribers and not shifting cost onto private plans. That may be a good thing or bad thing depending on your point of view. Obviously fixed Medicare reimbursements are the biggest distortion in the marketplace.

My belief about competition is that in order to increase it you must reduce barriers to entry and the threat of external market dislocations and regulations. If subsidies under MA aren’t high enough to bring more competitors in the marketplace it isn’t that the subsidies are too low. The MA programs are very popular and they offer much more in terms of care coordination and management under these plans.

I have trouble believing the meager 0.14 welfare expansion numbers when costs per enrollee were relatively similar. Furthermore, there are other benefits to MA plans as mentioned above and by others. I read the “findings brief “and without a lot more detail on the nature of the modeling, it would be hard for me to see how you can compare “average subsidies per beneficiary” in the drug plan versus the “the cost to convince one more HMO” to enter a market. Additionally, as far as the welfare differences are concerned, what were the components of this difference and do the actual data bear out the modeled results. Is the model predictive of results of more current data after the program has been in existence for a longer period of time?

Lastly, if consumers are selecting MA plans over drug plans and they are very popular and the insurers are competitively bidding and setting premiums, what is the problem if the costs per enrollee are very similar? If subsidies for MA are excessive relative to the drug plan, competition should increase services and value to seniors in the plan. I am missing something here.

The MA HMO’s in Tucson went through the downturn in 2000, but several plans stayed around. That will happend again I suppose. I will help my clients change plans or find some kind of coverage they can afford. I just hope there will be some decent coverage for them – besides just Medicare, which is not enough.

The Part D donut hole fix is a sellout to the pharmaceutical companies. If seniors could buy their drugs in Canada they’d be better off. Better yet, the government should be able to negotiate much lower prices for drugs. Part D is a burden for low-income seniors who don’t qualify for LIS.

I use the kff.org site to find stats on the numbers of MA enrolless in states like California, Arizona, Pennsylvania, Oregon, Rhode Island. One our of every three seniors in these states is in an MA plan. So lots of folks will be affected by MA cuts. That should make for interesting politics.

As I wrote earlier, I’m a liberal Democrat and I never liked MA plans as much as I do now that I’ve started debating this issue on various blogs. I’m not worried about protecting an income source and I do not like insurance companies. But I know too many seniors who are going to be hurt by the changes. Managed care is the answer to Medicare’s problems so I think we should be looking for ways to make managed care work financially for everyone concerned.

As an insurance agent, I can make money selling Medicare Supplements. I’m a Democrat and I believe Republicans force-fed Medicare Advantage to benefit insurance companies. As well, I see Part D as a big conspiracy to force seniors toward MA plans that include the drug plan.

I have been inclined to disparage MA plans because each year they put more costs onto seniors. But the more I hear number crunchers talk about 14 cents benefit …and tough luck for the 40% of seniors in Tucson who are on MA plans….well… that doesn’t sound like my Democratic party. And I just hope that in our desire to screw the insurance companies (and that’s okay with me) we don’t also screw the large numbers of seniors who are living on the edge and need help.

Here’s another thought: If the healthcare reform includes plans to subsidize people who need help paying health insurance premiums, what about subsidizing seniors? Without MA plans (a subsidy), millions of seniors are going to need subsidies for their healthcare costs.