The basics of medicare and medicaid
This presentation is the property of its rightful owner.
Sponsored Links
1 / 50

The Basics of Medicare and Medicaid PowerPoint PPT Presentation


  • 105 Views
  • Uploaded on
  • Presentation posted in: General

The Basics of Medicare and Medicaid. Judith R. Lave University of Pittsburgh. Medicare Eligibility. Individuals age 65 or over Individuals who have been on Social Security Disability for two years.

Download Presentation

The Basics of Medicare and Medicaid

An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -

Presentation Transcript


The basics of medicare and medicaid

The Basics of Medicare and Medicaid

Judith R. Lave

University of Pittsburgh


Medicare eligibility

Medicare Eligibility

  • Individuals age 65 or over

  • Individuals who have been on Social Security Disability for two years.

  • Individuals with End Stage Renal Disease (Kidney Failure) -2 year waiting period does not apply


Medicare is made up of four parts

Medicare is Made Up of Four Parts

  • Medicare Part A

    • HI- hospital insurance

  • Medicare Part B

    • SMI – Supplemental Medical Insurance

  • Medicare Part C

    • Medicare Advantage

  • Medicare Part D

    • Medicare Drug Coverage


Medicare part a

Medicare Part A

  • Helps pay For

    • Inpatient hospital care (all types)

    • Skilled nursing care

    • Hospice Care

    • Limited home health (up to 100 days post hospital discharge )

  • People are entitled to Part A if they or their spouse have paid payroll taxes for 40 quarters or more


Medicare part a1

Medicare Part A

  • Part A is funded primarily by a dedicated tax of 2.9% of earnings (no limit) paid by employers and employees (1.45% each)

    • Paid into a dedicated Trust Fund

  • There is some cost-sharing (2007)

    • Hospital: $992 deductible per spell of illness; $248 per day for days 61-90; $286 per day for days 91 – 150, 100% after day 150

    • Skilled Nursing Home: $124 per day 21 through 100 each benefit period.


Medicare part b

Medicare Part B

  • Pays for

    • Physician services, outpatient hospital services, certain home health services and durable medical equipment

  • Cost Sharing (2007

    • Deductible of $131.00 per year

    • 20% of approved charges after deductible

    • No cost sharing on home health


Medicare part b1

Medicare Part B

  • Medicare Part B is financed through premiums (about 25%) and general revenues

  • 2007 Premium was $93.50 a month

    • Premium is higher if income is above $80,000 (individuals) or $160,000 (families)


Medicare part c

Medicare Part C

Part C provides care through managed care plans, regional PPOs and private fee for service plans.

It is called Medicare Advantage

About 20% of Medicare beneficiaries are currently in Medicare Advantage


The basics of medicare and medicaid

Note

People who do not enroll in a Medicare Advantage Plan are said to stay in

Traditional Medicare or

Fee-for-service Medicare


Part c

Part C

  • Plans must cover the same services as Part A and Part B

  • It is financed by fixed payments from CMS tied to the gov’t cost of traditional Medicare.

  • People in Part C must be enrolled in both Parts A&B.


An issue of controversy

An Issue of Controversy

MA plans receive a capitated payment that is higher than the government’s average cost of covering Medicare beneficiaries that stay in traditional Medicare by about 10%

These additional payments increase attractiveness of MA plans by allowing them to reduce cost-sharing or offer additional benefits.


Part d

Part D

  • Voluntary drug program

  • Provided by private stand-alone drug plans or Medicare Advantage plans

  • Subsidies for individuals with low income and assets

  • Financed by beneficiary premiums of about $22 per month, general revenues and state payments (state clawbacks)

  • Complicated cost-sharing structure – plans may offer actuarial equivalent coverage


Standard medicare drug benefit 2006

Exhibit 8

Standard Medicare Drug Benefit, 2006

Beneficiary Out-of-PocketSpending

5%

Catastrophic Coverage

Medicare Pays 95%

$5,100 in Total Drug Costs**

$2,850 Gap: Beneficiary Pays 100%

No Coverage (the “doughnut hole”)

$2,250 in Total Drug Costs*

Partial Coverage

up to Limit

Medicare Pays 75%

25%

$250 Deductible

$386 average annual premium***

*Equivalent to $750 in out-of-pocket spending. **Equivalent to $3,600 in out-of-pocket spending.***Based on $32.20 national average monthly beneficiary premium (CMS, 8/2005).

SOURCE: KFF analysis of standard drug benefit described in Medicare Modernization Act of 2003.

Return to KaiserEDU.org


Medicare benefit payments by type of service 2006 kff

Exhibit 11

Part A

Part B

Parts A and B

Part D

Medicare Benefit Payments By Type of Service, 2006 (KFF)

Low-Income Subsidy Payments3%

Payments to Union/Employer-Sponsored Plans

1%

Payments to Drug Plans4%

Other Facility Services5%

Hospital Inpatient34%

Hospital Outpatient5%

Physician and Other Suppliers24%

Skilled Nursing Facilities5%

Hospice

2%

Home Health3%

Managed Care

(Part C)14%

Total = $374 billion

Note: Does not include administrative expenses such as spending forimplementation of the Medicare drug benefit and the Medicare Advantage program.

SOURCE: Congressional Budget Office, Medicare Baseline, March 2006.


Kff kaiser family foundation

KFF –Kaiser Family Foundation

These slides were downloaded from tutorials on the Kaiser Family Foundation Web-site.

www.KFF.org


Ten percent of all medicare beneficiaries account for more than two thirds of medicare spending kff

Exhibit 13

Ten Percent of All Medicare Beneficiaries Account For More than Two Thirds of Medicare Spending (KFF)

6%

10%

2002 average = $5,370 per capita

69%

Total Number of Beneficiaries: 41.8 million

Total Medicare Spending: $224.5 billion

SOURCE: Kaiser Family Foundation analysis of the Medicare Current Beneficiary Survey 2002 Cost and Use File.


Number of medicare beneficiaries 2005

Number of Medicare Beneficiaries 2005

  • Total: 42,394,929

  • % disabled (age < 65): 15.8%

    (Note % disabled is increasing over time:

    1980, 10.4%, 1995, 11/7%)

    http://www.cms.hhs.gov/MedicareEnrpts/


Value of medicare

Value of Medicare

Pays for the majority of health care services for people 65 and over and the disabled.

Leads to an increase in life expectancy

Leads to an increase in quality of life

Trusted Program


Problems with medicare

Problems With Medicare

  • Medicare does not cover many services – long term care, vision, hearing

    • Average Medicare beneficiary has out of pocket expenditures of $3,765, Medicare paid for 46% of health care expenditures for elderly.

  • Payment system needs to be revised – major changes in hospital payments this year

  • Medicare payments per beneficiary vary widely dramatically geographically with no measurable affects on health


Some challenges

Some Challenges

Improve payment system to promote quality and increase efficiency

  • Improve coverage for the chronically ill and address long term care problems

  • Determine balance between Traditional Medicare and Medicare Advantage

    • Should Medicare Advantage be Subsidized?


Majoer challenge

MAJOER CHALLENGE

Medicare’s Cost Pressures


Composition of federal spending in fy 2007

Exhibit 12

Composition of Federal Spending in FY 2007

Medicare14%

Social Security21%

Medicaid and SCHIP7%

Defense Discretionary19%

Other12%

Net Interest9%

Nondefense Discretionary18%

2007 Total Outlays = $2.77 trillion

SOURCE: OMB, Fiscal Year 2007 Budget, February 2006.

Return to KaiserEDU.org


Medicare expenditures 1998 2005

Medicare Expenditures1998-2005

NOTE: Per capita amounts based on July 1 Census resident based population estimates for each year. Numbers and percents may not add to totals because of rounding. $ amounts shown are in current dollars.

SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group; U.S. Bureau of the Census.


Historical and projected number of medicare beneficiaries and number of workers per beneficiary

Exhibit 15

Historical and Projected Number of Medicare Beneficiaries and Number of Workers Per Beneficiary

Number of beneficiaries (in millions)

Number of workers per HI beneficiary

78.6

4.0

3.9

2.4

42.7

SOURCE: 2001 and 2006 Annual Reports of the Boards of Trustees of the Federal Hospital Insurance and Federal Supplementary Medical Insurance Trust Funds.

Return to KaiserEDU.org


Key dates for medicare part a trust funds

Key Dates for Medicare Part A Trust Funds

First year outgo exceeds

Income excluding interest 2007

First year outgo exceeds

Income including interest 2011

Year Trust Funds are

Exhausted 2019


Medicare expenditures as a of gdp

Medicare Expenditures as a % of GDP


Why are we focusing on medicare and not social security

WHY ARE WE FOCUSING ON MEDICARE AND NOT SOCIAL SECURITY?


Social security and medicare cost as a percent of gdp

Social Security and Medicare Cost as a Percent of GDP


Why is medicare growing so much faster than social security

Why is Medicare Growing So Much faster than Social Security

  • Technological change in the absence of any effective restraining mechanism

    Technological change – which both increases the number of people who can get a given treatment (i.e. bypass) and the treatments available lead to increasing costs.


Questions

Questions?

  • Does Society want to allocate such a high proportion of its GDP to Medicare (note its somewhat limited benefits)

  • Does Society want to raise taxes to enable Medicare beneficiaries to get these services

  • Does Society want to allocate such a high proportion of its overall resources to the health of the elderly.


Medicaid

Medicaid

  • Established in 1965

  • States manage the program subject to Federal guidelines

  • States must cover certain groups (defined by age, disability and income) and may cover other groups

  • State must cover certain services and may cover other services.


Medicaid financing

Medicaid Financing

  • The federal government shares in the cost of the Medicaid.

  • The Federal Match varies across the states from 50% to 78%

  • Federal Match in PA is 54.39%


The basics of medicare and medicaid

Medicaid Eligibility & Benefits for Medicare Beneficiaries, 2005

Mandatory Populations: (Medicaid 101. ww.kaiser.edu)


Medicaid eligibility benefits for medicare beneficiaries 2005 cont d

Medicaid Eligibility & Benefits for Medicare Beneficiaries, 2005(cont’d)

Optional Populations

*Medicaid benefits may be more limited than for SSI.


Eligibility and covered services for pa

Eligibility and Covered Services for PA

M Costlow and J. lave, Faces.

www.PAMedicaid.pitt.edu


Federal poverty level 2007

Federal Poverty Level 2007

Persons in Family Guideline

1 $10,210

2 13,690

3 17,170

4 20,650


The basics of medicare and medicaid

Medicaid Benefits

“Mandatory” Items and Services

“Optional” Items and Services

  • Physician services

  • Laboratory and x-ray services

  • Inpatient hospital services

  • Outpatient hospital services

  • Early and periodic screening, diagnostic, and treatment (EPSDT) services for individuals under 21

  • Family planning

  • Rural and federally-qualified health center (FQHC) services

  • Nurse midwife services

  • Nursing facility (NF) services for individuals 21 or over

  • Prescription drugs

  • Clinic services

  • Dental services, dentures

  • Physical therapy and rehab services

  • Prosthetic devices, eyeglasses

  • Primary care case management

  • Intermediate care facilities for the mentally retarded (ICF/MR) services

  • Inpatient psychiatric care for individuals under 21

  • Home health care services

  • Personal care services

  • Hospice services


Medicaid status of medicare beneficiaries ffy 2002

Medicaid Status of Medicare Beneficiaries, FFY 2002

Total Medicare Beneficiaries = 40 million

Total Duals =

7.2 million

SOURCE: KCMU estimates based on CMS data and Urban Institute analysis of data from MSIS.


Medicaid payments per enrollee by acute and long term care 2003

Medicaid Payments Per Enrolleeby Acute and Long-Term Care, 2003

$12,800

$12,300

Long-Term

Care

Acute

Care

$1,900

$1,700

SOURCE: KCMU estimates based on CBO and Urban Institute data, 2004.


Some pa data

Some PA Data

  • Medicaid covers about 14.8% of Pennsylvanians on an average month

  • Medicaid covers 44% of all children

  • Medicaid expenditures are = $14.4 billion dollars ($7.6 Billion Federal)

  • It accounts for 19% of general fundspending


Figure 5 percent of pennsylvania citizens enrolled in medicaid by age september 2006

Figure 5: Percent of Pennsylvania Citizens Enrolled in Medicaid by Age September 2006

Note. Data provided by PA DPW: Commonwealth of Pennsylvania, Department of Public Welfare (PA DPW). (2006). Medical Assistance Eligibility Statistics, (PA DPW). Provided to authors by Director, August–December 2006.


The basics of medicare and medicaid

Figure 4: Distribution of Pennsylvania Medicaid Recipients and Expenditures by Broad Eligibility Category in 2005

Note. Data provided by PA DPW: Commonwealth of Pennsylvania, Department of Public Welfare, Office of Medical Assistance Programs. (2006). 2005/2006 Annual Report. Retrieved February 22, 2007, from http://www.dpw.state.pa.us/Resources/Documents/Pdf/AnnualReports/OMAP05-06AnnualReport.pdf.


Figure 6 the proportion of medicaid recipients to pennsylvania county populations in 2006

Figure 6: The Proportion of Medicaid Recipients to Pennsylvania County Populations in 2006

Note. Data Provided by PA DPW. Other information from U.S. Census Bureau, 2006.[1]Pennsylvania map provided via 'Do It Yourself' Color-Coded State Maps, http://monarch.tamu.edu/~maps2/, Texas A&M University System.

Commonwealth of Pennsylvania, Department of Public Welfare (PA DPW). (2006). Medical Assistance Eligibility Statistics, (PA DPW). Provided to authors by Director, August–December, 2006. and U.S. Census Bureau. (2006). State and County QuickFacts. Retrieved November 15, 2006, from http://quickfacts.census.gov/qfd/states/42000.html


Figure 3 pennsylvania medicaid recipients from 1997 2005

Figure 3: Pennsylvania Medicaid Recipients from 1997–2005

Note. Data provided by PA DPW: Commonwealth of Pennsylvania, Department of Public Welfare (PA DPW). (2006). Medical Assistance Eligibility Statistics, (PA DPW). Provided to authors by Director, 1997–2006.


Cost problems come to medicid

COST PROBLEMS COME TO MEDICID


Medicaid expenditures 1998 2005

Medicaid Expenditures1998-2005

NOTE: Per capita amounts based on July 1 Census resident based population estimates for each year. Numbers and percents may not add to totals because of rounding. $ amounts shown are in current dollars.

SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group; U.S. Bureau of the Census.


Underlying growth in state tax revenue compared with average medicaid spending growth 1997 2005

Underlying Growth in State Tax RevenueCompared with Average Medicaid Spending Growth, 1997 - 2005

NOTE: State Tax Revenue data is adjusted for inflation and legislative changes. Preliminary estimate for 2005.

SOURCE: KCMU Analysis of CMS Form 64 Data for Historic Medicaid Growth Rates and KCMU / HMA Survey for 2005 Medicaid Growth Estimates; Analysis by the Rockefeller Institute of Government for State Tax Revenue.


Composition of federal spending in fy 20071

Exhibit 12

Composition of Federal Spending in FY 2007

Medicare14%

Social Security21%

Medicaid and SCHIP7%

Defense Discretionary19%

Other12%

Net Interest9%

Nondefense Discretionary18%

2007 Total Outlays = $2.77 trillion

SOURCE: OMB, Fiscal Year 2007 Budget, February 2006.

Return to KaiserEDU.org


Changes in medicaid

Changes in Medicaid

  • Medicaid is changing due in part to the addition flexibility given to the states under the Deficit Reduction Act.

  • Trend did turn down this year.


What s at stake in medicaid reform kff

What’s at Stake in Medicaid Reform (KFF)

Health Insurance Coverage

25 million children and 14 million adults in low-income families; 6 million persons with disabilities

Assistance to Medicare Beneficiaries

7 million aged and disabled — 18% of Medicare beneficiaries

Long-Term Care Assistance

1 million nursing home residents; 43% of long-term care services

MEDICAID

Support for Health Care System

17% of national health spending

State Capacity for Health Coverage

43% of federal funds to states


  • Login