Medicaid Recovery Audit Contractors Rule Announced To Help Reduce Improper Payments

Main Category: Medicare / Medicaid / SCHIP
Article Date: 08 Nov 2010 – 4:00 PST

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The Centers for Medicare Medicaid Services (CMS) proposed new rules to help states reduce improper payments for Medicaid health care claims through the use of Medicaid Recovery Audit Contractors (RACs) as part of the Affordable Care Act’s larger strategy to crack down on waste, fraud and abuse in the health care system. Medicaid RACs are contractors, working for States, that will audit payments made to health care providers to identify Medicaid payments that may have been underpaid or overpaid, and recover overpayments or correct underpayments, similar to the RAC program in Medicare.

“Reducing improper payments is a key goal of the Administration, and the tools provided by the Affordable Care Act will help us achieve that goal,” said CMS Administrator Donald Berwick, M.D. “We are using many of the lessons that we learned from the Medicare RAC program in the development and implementation of the Medicaid RACs, including a far-reaching education effort for health care providers and State managers.”

Under the Affordable Care Act, States must establish Medicaid RAC programs by submitting state plan amendments to CMS by December 31, 2010. The law allows CMS to provide extensions or exceptions to States, if necessary, and details regarding these processes are included in the proposed regulation. In addition, the proposed regulation issued by CMS today outlines the requirements that states must meet and the Federal contribution CMS will provide to assist in funding the state RAC programs.

Medicaid RACs will be paid by the States on a contingency basis to review Medicaid provider claims, identify and recover overpayments made for services provided under Medicaid State plans and Medicaid waivers. The proposed regulation allows States the discretion to determine whether to pay their Medicaid RACs on a contingency basis or under some other fee structure for identifying underpayments.

CMS is encouraging interested parties to comment on the proposals included in the regulation. These include the payment methodology for identifying overpayments and underpayments as well as the recovery of overpayments and correction of underpayments, and the requirement that RACs report fraud or criminal activity whenever they have reasonable grounds to believe such activity has occurred.

Under the regulation, as proposed, a State may use its current administrative appeals process or may modify its process for Medicaid RAC-related appeals. All fees paid to the Medicaid RACs must come from amounts recovered after all available appeals have been exhausted.

Because CMS has proposed to require States to implement their programs in a timely manner, CMS is providing educational programs to help States understand both the Medicare and Medicaid RAC programs. On October 1, 2010, CMS released a State Medicaid Director letter which provided initial guidance to the States regarding the RAC program. CMS issued an educational DVD entitled “Medicaid RACs: Are You Ready?” targeted to State Medicaid and Program Integrity Directors and held a webinar for states offering RAC procurement tips. Additionally, on November 4, 2010, CMS hosted an educational forum describing Lessons Learned from CMS’s experience with Medicare RACs.

Source:

Centers for Medicare Medicaid Services



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New Report Shows Affordable Care Act Savings Of $3,500 For Medicare Beneficiaries

Main Category: Medicare / Medicaid / SCHIP
Article Date: 08 Nov 2010 – 4:00 PST

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Lower prescription drug costs, reduced waste, fraud, and abuse, and improvements to care quality and increased system-wide efficiency will reduce costs in traditional Medicare

A new analysis issued today by the U.S. Department of Health and Human Services estimates that under the Affordable Care Act, average savings for those enrolled in traditional Medicare will amount to more than $3,500 over the next 10 years. Savings will be even higher – as much as $12,300 over the next 10 years – for seniors and people with disabilities who have high prescription drug costs.

“The Affordable Care Act makes Medicare stronger and reduces the burden of health care costs on some of our most vulnerable citizens,” said Secretary Kathleen Sebelius. “The law improves benefits for seniors and people with beneficiaries who rely on Medicare and ensures that Medicare will be there for current and future generations by extending the life of the Medicare Trust Fund. These benefits and savings are only possible with the continued implementation of the Affordable Care Act.”

The analysis, released by the Office of the Assistant Secretary for Planning and Evaluation (ASPE), shows that the Affordable Care Act helps lower costs for those on Medicare by slowing the growth of cost-sharing in Medicare. Closing the Part D coverage gap known as the “donut hole” will produce the greatest cost savings. Already, more than 1.8 million seniors and people with disabilities who have reached the donut hole in 2010 received a one-time $250 rebate check, and checks will continue to be distributed to those who enter the donut hole this year. Next year, people in the donut hole will receive 50 percent discounts on covered brand name Part D prescription drugs. Also starting next year, seniors and people with disabilities on Medicare will have access to a number of recommended preventive services and annual wellness visits at no additional cost.

Although all seniors and people with disabilities in Medicare are likely to see savings, the savings will be greatest for those with costly medical conditions or high prescription drug costs. Total savings per beneficiary enrolled in traditional Medicare are estimated to be $86 in 2011, rising to $649 in 2020. For a beneficiary with spending in the donut hole, estimated savings increase from $553 in 2011 to $2,217 in 2020.

“The savings that seniors and people with disabilities on Medicare are seeing are due to critical improvements the Affordable Care Act makes to Medicare,” said Assistant Secretary for Planning and Evaluation, Sherry Glied. “Reducing waste, fraud and abuse, improving the quality of care beneficiaries receive, and making the program more efficient all contribute to lower cost increases across the system.”

The full analysis is available here.

Source:

HHS



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Home Health, Other Medicare Providers Face Pay Cuts

Main Category: Medicare / Medicaid / SCHIP
Also Included In: Seniors / Aging;  Primary Care / General Practice;  Public Health
Article Date: 08 Nov 2010 – 4:00 PST

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Bloomberg/The Washington Post: Home health providers face Medicare payment cuts next year. “Gentiva Health Services and Amedisys are among the providers of at-home health care to receive lower Medicare payments next year under U.S. government changes to the program.

A 4.89 percent reduction in home health spending for the elderly is among annual modifications in Medicare affecting hospitals, doctors and providers in the United States. Most rates take effect in January, though payments for doctors start to drop Dec. 1, the Centers for Medicare and Medicaid Services said in a statement this week. ” A panel that advised Congress on Medicare issues found in 2008 that home health agencies were making 17 percent profits on their Medicare business (Wayne, 11/5).

This information was reprinted from kaiserhealthnews.org with kind permission from the Henry J. Kaiser Family Foundation. You can view the entire Kaiser Daily Health Policy Report, search the archives and sign up for email delivery at kaiserhealthnews.org.

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Arcadia Resources To Launch DailyMed™ Pharmacy Program In Kansas

Main Category: Pharmacy / Pharmacist
Also Included In: Medicare / Medicaid / SCHIP
Article Date: 09 Nov 2010 – 3:00 PST

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Arcadia Resources, Inc. (NYSE Amex: KAD), a leading provider of innovative consumer health care services under the Arcadia HealthCare(SM) brand announced that a WellPoint, Inc. affiliated health plan will offer its members in Kansas the opportunity to enroll in Arcadia’s DailyMed™ Pharmacy Program beginning this month.

“We are excited to extend the DailyMed brand and value proposition to Medicaid members in Kansas who are in need of appropriate pharmaceutical care and to help them more effectively manage their medication utilization therapy,” said Marvin R. Richardson, President and Chief Executive Officer of Arcadia HealthCare. “With the addition of Kansas, DailyMed is now offered to high-risk Medicaid members in California, South Carolina and Virginia through WellPoint affiliated health plans that provide or administer Medicaid managed care benefits.

The DailyMed Pharmacy Program, a first in Kansas, eliminates the guesswork when taking complex or multiple prescriptions by providing members with a 30-day supply of their medications, delivered to their home, in pre-sorted packets marked with the date and time the medications should be taken.

Source: Arcadia Resources, Inc



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Election Postmortems Continue Regarding Health Overhaul

Main Category: Health Insurance / Medical Insurance
Also Included In: Medicare / Medicaid / SCHIP;  Seniors / Aging
Article Date: 09 Nov 2010 – 4:00 PST

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In an analysis in The Washington Post, Chris Cillizza asks: “How much did the health-care law passed this year have to do with Republicans winning back the House and gaining six seats in the Senate?” Polls shed a little – deeply contradictory – light on the question. A Democratic strategist argued it was a neutral issue in an election-night memo, saying only 18 percent of voters believed health care was the most important issue, and that Demcorats won those by an eight percentage point margin. But, a GOP operative argued seven in ten voters had seen advertising about the health law that they recalled opposed the legislation (Cillizza, 11/7).

Politico: “Voters over 65 favored Republicans last week by a 21-point margin after flirting with Democrats in the 2006 midterm elections and favoring John McCain by a relatively narrow 8-point margin in 2008. … Senior voters seemed motivated by concerns about the health care law and punished incumbent Democrats accordingly. The bill cut $500 billion from Medicare programs [over 10 years], a wash at best for older citizens. And Democrats largely failed to campaign successfully on aspects of the law targeted to benefit seniors, like closing the ‘doughnut hole’ in Medicare Part D prescription drug coverage” (Tau, 11/7).

President Barack Obama said Sunday on CBS’ “60 Minutes” that the health law debate had extracted a greater political cost than he expected, The Associated Press reports. Obama said, “I made the decision to go ahead and do it, and it proved as costly politically as we expected – probably actually a little more costly than we expected, politically… I couldn’t get the kind of cooperation from Republicans that I had hoped for… [a]nd that was costly, partly because it created the kind of partisanship and bickering that really turn people off” (11/7).

See the whole “60 Minutes” interview at CBS News.

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Feds Crack Down On Fraud By Issuing New Medicaid Rules, Helping Medical Students Catch Fraud

Main Category: Medicare / Medicaid / SCHIP
Also Included In: Medical Students / Training
Article Date: 09 Nov 2010 – 5:00 PST

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The Hill Healthwatch: “The Centers for Medicare and Medicaid Services on Friday proposed new rules for the use of private contractors that work for states to audit Medicaid payments. The Recovery Audit Contractors will function similarly to the way they do in the Medicare program, where they audit payments that may have been underpaid or overpaid, and recover overpayments or correct underpayments. … Under the new law, states must establish Medicaid RAC programs by submitting state plan amendments to CMS by December 31” (Pecquet, 11/5).

In a separate posting, The Hill Healthwatch: “The Department of Health and Human Services on Friday unveiled a new tool to help medical school students learn to spot and fight Medicare fraud. The booklet, entitled ‘Roadmap for New Physicians: Avoiding Medicare and Medicaid Fraud Abuse,’ will go out to medical schools across the country. It explains the laws that apply to physicians so they can comply with federal law, avoid liability and spot signs of potential fraud. The release coincides with the third regional healthcare fraud prevention summit, held Friday in Brooklyn” (Pecquet, 11/5).

American Medical News: “Medicare administrators have not been using historical error rate data to identify and focus on physicians prone to mistakes when reporting claims, according to a report delivered in October by the Department of Health and Human Services Office of Inspector General. The OIG has targeted the integrity of Medicare payments as one of the top management challenges facing the Centers for Medicare Medicaid Services. From fiscal [years] 2005 to 2008, the agency said it located 740 repeat offenders, including physicians and suppliers of medical equipment that had at least one error in each audit year and referred to them as ‘error-prone providers.’ … CMS reported four categories of errors: incorrect coding, medically unnecessary services, documentation errors and other errors. The OIG said that those errors, when viewed across the entire Medicare system, account for most of the $44.1 billion in improper payments that CMS reported for fiscal 2005 to 2008” (Silva, 11/8).

Detroit Free Press: “At least one in 10 Detroit seniors last year reported being scammed in the prior year, according to new research from the Wayne State University Institute of Gerontology. Nationally, one in 20 seniors reported being scammed. But even more surprising for researcher Peter Lichtenberg: It wasn’t financial instability or failing minds that made seniors vulnerable – it was feelings of loneliness and being undervalued. They increased the risk of being swindled by 30 percent” (Erb, 11/8).

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Seniors Need To Check Options As Medicare Advantage Plans Change, Drop Out

Main Category: Medicare / Medicaid / SCHIP
Also Included In: Seniors / Aging
Article Date: 09 Nov 2010 – 5:00 PST

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The Seattle Times: “The exodus of dozens of Medicare Advantage plans from various counties or from the state entirely is leaving 40,588 seniors across Washington to wade through charts in search of new plans. In some counties, most Medicare Advantage plans no longer will be offered, leaving patients with little choice. … Those whose Medicare Advantage plans have left their areas should have been notified, and have until Jan. 31 to change. However, the state Insurance Commissioner’s Office advises signing up before Dec. 31 to make sure there’s no break in coverage. Although Medicare Advantage (MA) plans come and go every year, turnover here and nationally is much higher this year than last, when almost 18,000 Washington residents lost their plans” (Ostrom, 11/7).

Minneapolis Star Tribune: “Out-of-pocket prescription drug costs will drop sharply next year for thousands of Minnesotans who carry Medicare drug insurance — especially those with the highest expenses. That’s because the federal health care overhaul passed last spring will begin to erase the ‘doughnut hole’ gap in Medicare coverage that has required beneficiaries to shoulder sizable costs. Most affected will be the 125,000 or so Minnesotans with the highest drug expenses — about a quarter of the 510,000 beneficiaries with Medicare Part D — who traditionally hit that $3,610 gap in coverage and begin paying the full cost for drugs. Starting next year, a federal subsidy will allow those who hit the gap to pay 50 percent of the cost of medications, for brand-name drugs covered by their policy, and 93 percent of the cost for the much cheaper generic drugs” (Wolfe, 11/7).

Omaha World-Herald: “Comparing drug plans for Medicare Part D has become more important because of the tight economy, Nebraska and Iowa health insurance officials say. Enrollment for 2011 coverage starts Nov. 15 and runs through Dec. 31. It’s the period in which people can switch plans. The federal Part D program provides subsidized prescription drug coverage for people 65 and older or people who have disabilities. Premiums and co-payments have increased for some plans in 2011, [Rachel Schlesselman of the Nebraska Senior Health Insurance Information Program] said” (O’Conner, 11/7).

This information was reprinted from kaiserhealthnews.org with kind permission from the Henry J. Kaiser Family Foundation. You can view the entire Kaiser Daily Health Policy Report, search the archives and sign up for email delivery at kaiserhealthnews.org.

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CMS To Review Cancer Vaccine, Analysis Shows High Medicare Drug Spending Not Correlated With Better Care

Main Category: Medicare / Medicaid / SCHIP
Also Included In: Prostate / Prostate Cancer;  Immune System / Vaccines
Article Date: 09 Nov 2010 – 5:00 PST

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Washington Post: The Centers for Medicare Medicaid Services “are conducting an unusual review to determine whether the government should pay for an expensive new vaccine for treating prostate cancer, rekindling debate over whether some therapies are too costly.” The “national coverage review” will evaluate Provenge, the “first vaccine approved for treating any cancer,” which was approved in April. “The treatment costs $93,000 a patient and has been shown to extend patients’ lives by about four months. Although Medicare is not supposed to take cost into consideration when making such rulings, the decision to launch a formal examination has raised concerns among cancer experts, drug companies, lawmakers, prostate cancer patients and advocacy groups. … Medicare officials, who are convening a panel of outside advisers to vet the issue at a public hearing Nov. 17, say Provenge’s price tag isn’t an issue. But … officials declined to discuss the rationale for the review” (Stein, 11/8).

HealthDay/USA Today: Meanwhile, an analysis of the U.S. Healthcare Effectiveness Data and Information Set showed that more “drug spending don’t necessarily translate into better quality care for Medicare patients,” revealing “wide variation across the United States in both Medicare drug spending and the rate of inappropriate prescriptions for the elderly.” The analysis, conducted by University of Pittsburgh researchers and published in the New England Journal of Medicine, “also found that regions where Medicare patients were more likely to get prescriptions for high-risk or potentially harmful drugs did not necessarily spend more on drugs overall than regions with lower use of high-risk or potentially harmful drugs” (Preidt, 11/6).

This information was reprinted from kaiserhealthnews.org with kind permission from the Henry J. Kaiser Family Foundation. You can view the entire Kaiser Daily Health Policy Report, search the archives and sign up for email delivery at kaiserhealthnews.org.

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Medicare Policy Changes Will Make It More Difficult For Nevada Beneficiaries To Obtain Power Wheelchairs

Main Category: Medicare / Medicaid / SCHIP
Article Date: 09 Nov 2010 – 6:00 PST

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Will power wheelchairs continue to be available to Nevada’s
Medicare patients following a series of federal regulatory and policy changes?

There are grave concerns among consumer groups, Medicare beneficiaries and homecare equipment
providers in Nevada that the changes in Medicare policies may severely hamper the ability of
providers to supply quality products and services to beneficiaries.

One of the biggest threats is a new law establishing that the Medicare program will pay rental
payments over a 13 month period to homecare equipment providers after they supply power
wheelchairs to Medicare beneficiaries. The change will create significant cash flow problems for
providers, who will be forced to purchase the equipment from manufacturers, and then receive
reimbursement payments stretching over 13 months. Previously, Medicare beneficiaries could
request that the government purchase the equipment for them in the first month of use.

In addition, the Medicare program is expanding the flawed “competitive” bidding system. The
program restricts the number of providers who can supply home medical equipment in selected
geographical areas around the country, severely jeopardizing access to power wheelchairs for
seniors and those living with physical disabilities.

“We fear that the Medicare mobility benefit won’t be available for the people who need it because
there won’t be providers around to fill the power wheelchair prescriptions once doctors order them
for their patients,” said Corrie Herrera, rural director for the Northern Nevada Center for
Independent Living in Elko, Nevada. “Our organization, as well as others across the state who
represent people living with disabilities, feel that the Washington policymakers don’t understand
how much a power wheelchair means to the people who need them. We must ensure that Medicare
patients continue to have access to this equipment.”

Herrera said physicians prescribe power wheelchairs to patients needing assistance with critical
daily activities, such as grooming, getting to the bathroom and preparing food. By continuing to
perform these tasks in their homes with power wheelchairs, Herrera said it often delays the
necessity of placing beneficiaries in expensive nursing homes. Mobility assistance also reduces
emergency room visits for Medicare patients, who are less likely to suffer injuries from falls.

Jason Turner, 43, of Las Vegas, said his power wheelchair has made a dramatic difference in his
life. Turner, who has multiple sclerosis, said he has used a power chair for a dozen years. “It is like
getting my legs back,” said Turner. “I can help my daughters with their homework; and I have the
freedom and independence to go wherever I need to go.”

Moreover, Turner said that he is relieved not to be a “burden” on anyone because he can do so
many things for himself. “I hope that power wheelchairs remain available for other Medicare
beneficiaries,” he said. “Being mobile changes your life.”


Madonna Long, formerly of Reno and Battle Mountain, recalled that her mother, Ruth Crosthwaite,
began using a power wheelchair before she passed away. “My mother had severe arthritis and
could not push a manual wheelchair,” said Long, who has been in a wheelchair herself since
suffering injuries in a school bus accident as a teenager. “My wheelchair, and my mother’s
wheelchair, allowed us to live our lives, and continue to do the things that we love. It’s important
that other Medicare beneficiaries can also enjoy freedom and independence.”

But in recent years, changes in Medicare policies have significantly impacted providers, hampering
their ability to supply quality home medical equipment and services to Medicare beneficiaries. Over
the last five years, the Medicare program has cut reimbursements for power wheelchairs by more
than 35 percent. At the same time, the providers are experiencing excessive government audits and
extended delays in reimbursement payments.

The new rental reimbursement policy will slash providers’ cash-on-hand by 40 percent in the first
year. Because of the struggling economy, providers are unable to obtain loans or credit lines that
would allow them to purchase power wheelchairs from manufacturers and do the necessary
servicing so that Medicare beneficiaries have properly-adjusted equipment. Many Medicare
patients would receive chairs stored in warehouses that haven’t been specially fitted to address the
individual needs of the patients.

Consumer groups, providers, and Medicare patients are asking Congress to delay implementation of
the new policy from January 1, 2011 to January 1, 2012. The extra year would allow providers time
to adjust their business models. The delay wouldn’t increase Medicare spending because providers
would agree to a one-percent reduction in reimbursement rates for standard power wheelchairs.

Meanwhile, the bidding program for home medical equipment and services is scheduled to take
effect in nine metropolitan areas in January 2011. An additional 91 areas will start preparing for the
bidding program later in 2011, including locations in Nevada.

Yet, in September 166 bidding system experts and economists, including two Nobel laureates, sent
a letter to Congress warning about major problems with the bidding system. The experts concluded
that the system will fail, citing the fact that the bids are non-binding, the rules encourage
unsustainable low-ball bids, the design distorts bids and the program lacks transparency. H.R.
3790, the bill in the House of Representatives with broad bipartisan support, would replace the
bidding program with other types of cost savings but preserve patient access to mobility equipment.
Organizations that favor elimination of this bidding program include the ALS Association,
American Association of People with Disabilities, Muscular Dystrophy Association, National
Council on Independent Living, National Spinal Cord Injury Association, and United Spinal
Association, among others.

Source:

American Association for Homecare




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Today’s Op-Eds: The Medicare Cost-Cutting Debate; Two Perspectives On ‘Repeal And Replace’

Main Category: Medicare / Medicaid / SCHIP
Also Included In: Primary Care / General Practice;  Public Health;  Health Insurance / Medical Insurance
Article Date: 09 Nov 2010 – 6:00 PST

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How Medicare Killed the Family Doctor The Wall Street Journal
Medicare introduced a whole new dynamic in the delivery of health care. Gone were the days when physicians were paid based on the value of their services. With payment coming directly from Medicare and the federal government, patients who used to pay the bill themselves no longer cared about the cost of services (Richard M. Hannon, 11/8).

Health Care Providers Should Initiate Cost Cuts; Waiting For The State Government Stalls Action The New York Daily News
So how can we make health care affordable without gutting the quality of our hospitals and primary care providers, or shredding the medical safety net for the poor? The answer lies in health care providers taking a lead rather than waiting for the state government to do what it usually does in budget crises: cut blindly at everything on the table, because political interests get in the way of creative solutions (James Knickman, 11/7).

Our View On Medical Reform: Don’t Try To Repeal The New Health Care Law, Improve It USA Today
As if Congress didn’t already have enough to do next year on jobs and taxes, incoming Republican leaders have made repeal of the new health reform law one of their top priorities. What a monumental waste of time and energy (11/7).

Opposing View On Medical Reform: Repeal And Replace ObamaCare USAToday
By putting an end to junk lawsuits, encouraging small businesses to band together to provide health plans, forcing insurance companies to compete by allowing Americans to shop across state lines, and giving states the flexibility to make changes that best meet the needs of their residents, we can reduce premiums and still provide important patient protections. … It doesn’t take $1 trillion in new government spending, $500 billion in new taxes and $500 billion in cuts to Medicare over the next decade (Dave Camp, 11/7).

Irrational About Healthcare Rationing The Los Angeles Times
It’s fair to debate how best to achieve healthcare reform. But it’s hard to see how healthcare costs can be brought under control if attempts to make the system more efficient and effective get waylaid by irrational fears about rationing (11/8).


Attacking The Health Law: The GOP’s Confusing And Incompatible Arguments Kaiser Health News
Allowing Medicare to continue going along as it has been for the last ten to twenty years — which is what repealing the new health law would do — would almost surely force a choice between much higher taxes or much worse access to care. If you don’t believe me, just look at the plan proposed by Republican Representative Paul Ryan, who is forthright enough to admit that the GOP alternative to the Democrats’ approach to Medicare is to reduce radically its guaranteed benefits (Jonathan Cohn, 11/8).

Andy Of Medicare Chicago Tribune
Aside from the suspicious timing, the ad is misleading. Griffith is right that basic Medicare benefits won’t be cut. But that makes it sound like seniors won’t feel the pinch of the new law. Many will (11/5).

Mental Health Is The New Antiabortion Battleground. But The Science Is All Wrong. The Washington Post
Women who think they made the right decision in having an abortion must be able to say so without fear of condemnation and without feeling that something is wrong with them. And women who feel sadness and regret should feel free to share their feelings as well. But their words should not be used to deceive women or to limit their choices (Brenda Major, 11/7).

This information was reprinted from kaiserhealthnews.org with kind permission from the Henry J. Kaiser Family Foundation. You can view the entire Kaiser Daily Health Policy Report, search the archives and sign up for email delivery at kaiserhealthnews.org.

© Henry J. Kaiser Family Foundation. All rights reserved.





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