Burr and Coburn intro Seniors’ Choice Act

Senator Richard Burr (R-NC) and Tom Coburn (R-OK) today will announce their Medicare reform bill, The Seniors’ Choice Act. Avik Roy gave me the text and has a lengthy post up and he is a fan.

The devil is in the details, and with any premium support approach to allow Medicare beneficiaries to purchase private insurance, the most important detail is how the premium support amount will be set. The TIE FAQ entry on competitive bidding is required reading for anyone interested in this type of policy. The broad outline of the plan:

  • Maintain traditional FFS Medicare, but introduce a premium support approach designed to get traditional and private Medicare to compete. Again, the details are the key
  • Raise the Medicare eligibility age. TIE FAQ on that
  • New out of pocket cost maximum, unified across all parts of Medicare, with higher cost sharing for high income persons
  • Creation of a voluntary care coordination benefit
  • Repeal the IPAB. This one is particularly ironic given Burr and Coburn’s Patients’ Choice Act (introduced in May 2009), which I argue has similar boards with far more power than IPAB

Politically speaking, this further reinforces that Republicans realize the plan to move to eventually do away with FFS Medicare altogether is a non starter. It brings about the move toward a new premium support approach sooner (2016) than does the Wyden-Ryan plan. As said now three times in this post, the details are the key for any premium support/competitive bidding approach, although I suspect that if there ever is a deal on Medicare it will be called premium support/competitive bidding. I need to look more closely at what is written, but the maximum out of pocket cost benefit and the means testing of this is worth a closer look. More later


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