Opening Statement of the Hon. Nancy Johnson, M.C.,
Connecticut,
and Chairwoman, Subcommittee on Health
Hearing on the Medicare+Choice: Lessons for Reform
May 1, 2001
Today the Subcommittee continues its series of hearings on ways to strengthen and improve the Medicare program. This is our fourth Subcommittee hearing on Medicare modernization. In other hearings this year, we have undertaken a general overview of reform ideas, we have explored the impact of Medicare's regulatory burden on providers, and we have discussed the issues we will confront as we add a much-needed prescription drug benefit to the program. In addition, the full Ways and Means Committee has examined program solvency with Treasury Secretary O'Neill and talked about the Administration's health care priorities with HHS Secretary Thompson.Today's hearing focuses on Medicare+Choice. This important program has significantly expanded the range of health care options available to some Medicare beneficiaries. In fact, 15% of the program's beneficiaries are now enrolled in Medicare+Choice. Many of these beneficiaries enjoy reduced cost-sharing obligations, richer benefits, and a more coordinated approach to preventive health care and disease management.
However, we all know that the program has confronted real implementation problems. Plan pull-outs over the past three years have been significant. Premiums have increased and benefits have been cut. Payment systems are complicated and result in inequities that affect both plan participation and the richness of the benefits offered to enrollees. And the regulatory environment has stifled rather than fostered plan development.
Over the past two years, Congress has acted to increase plan payment rates and to decrease the regional variations in rates and benefits afforded to participants, with the goal of stabilizing the program and expanding beneficiary access to a wider array of choices. However, real problems remain.
This afternoon we will hear from two panels of witnesses who will help us focus on both the strengths of the Medicare + Choice program and the challenges it faces. Our first panel consists of representatives of three health plans participating in the program. These witnesses will identify talk about the valuable services Medicare + Choice plans offer beneficiaries. I am particularly interested in the innovations in disease management made possible through the coordinated care delivery model at the heart of the Medicare + Choice program.
Our second panel will focus on two of the most complicated challenges facing the Medicare + Choice program - its convoluted payment system and its stifling regulatory environment. Our final witness, Mike O'Grady, will suggest solutions to the program's problems to make it more market-oriented and more responsive to the needs of Medicare's beneficiaries.
I look forward to our witnesses' testimony and to working with my colleagues as we develop legislation to ensure that Medicare beneficiaries across the country enjoy real choices within a healthy, competitive system.