27 October 2012 Medicare Advantage and the missing $700 billion

          The back and forth character assassinations and other miasmic misinformation that has migrated to the top of the simmering stew of attack ads often centers around $700 billion that is somehow being “stolen” by Obama, from Medicare, to fund Obama Care. 

          The teavangelists, following hard behind the campaign of lies that was the GOP primary, assert that the sum of $716 billion has been “stolen from Medicare.” 

          The Obama campaign, with no need to produce any lies about health care – the reality is bad enough – provide an answer that Politico reports as true.  There was, indeed, a shift in allocation of $716 billion.  It will be used to help fund Obama Care rather than funding a previous component of the current Medicare program.  To that slight extent, the teavangelists are correct.

          The missing $716 billion is being carved from the Medicare advantage programs.  Essentially, Obama and friends are stripping a huge chunk of change from the health insurance companies, who were being rewarded by Congress for campaign support by letting the insurance industry feast off a scheme they concocted to add to their profits.

          Medicare Advantage programs are paid for by the government but administered by insurance companies.  They bill Medicare for additional expenses and services that are often not indicated for or used by the patient.  These are marketed to the patients as “freebies or extras.”  They include gym membership, some small reductions on drug costs and other services if the insured remains entirely within the restrictions of “the plan.”  While this may be somewhat practical for healthy seniors in up-scale urban areas, once into the more rural and less well-to-do regions of the country it becomes harder to remain “in-plan.” And the “freebies” that originally enticed the patient to shift to an Advantage program become “unused” or impractical to take advantage of. 

          The Insurance companies continue to be reimbursed at the higher compensation level they negotiated as if everyone and everything was as intended by the lobbyists who wrote that portion of the law. 

          What is taking place, being referred to as theft from Medicare, is the removal of the extra compensation, the Advantage plans, that the Insurance companies were using fraudulently to increase profits while stealing from patients and Medicare.  They’ve had their hands in the cookie jar for a long time and they don’t like having them removed from a source of legally fraudulent revenues. 

          Obama’s administration is taking money from the insurance company’s slush funds and applying it to providing insurance for the currently uninsured.  Where’s the advantage in that?  Right where it should be.