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Camp: MedPAC Data Calls into Question Adequacy of Government-Run Plans

April 01, 2015

Camp: MedPAC Data Calls into
Question Adequacy of Government-Run Plans

WASHINGTON, DC —  Ways and Means Ranking Member Dave Camp (R-MI) today released data from a 2008 Medicare Payment Advisory Commission (MedPAC) report showing more than 90 percent of seniors enrolled in the government-run Medicare program need and get additional health care coverage.

“Supporters of government-run health insurance think federal bureaucrats can do a better job designing and operating a health plan than the private sector.  Some point to Medicare as a model, and most suggest that payments to providers serving patients enrolled in a government-run plan would be tied to Medicare payment rates.

“What is often lost in the debate is just how inadequate Medicare really is.  For example, this year, seniors are required to pay nearly $1,100 out of their pockets before Medicare will cover a single test or procedure associated with a one-day hospital stay.  So it’s not surprising that more than 90% of all seniors eligible for Medicare find the benefit package is insufficient and are forced to purchase additional coverage on their own or supplement it in some way or another.  According to a 2008 report by the Medicare Payment Advisory Commission (MedPAC), among non-institutionalized seniors in 2005:

  • 31.9% were also enrolled in an employer-sponsored plan;
  • 28.5% were also enrolled in a Medigap plan;
  • 14.6% were also enrolled in a Medicare Advantage plan;
  • 14.2% were also enrolled in Medicaid;
  • 1.3% were also enrolled in some other public sector benefit; and
  • Just 9.6% had no supplemental coverage at all.

“What is clear is that the government has a poor track record in designing health benefits.  Bureaucrats did such a poor job of designing the traditional Medicare program that more than 90% of enrollees have to find additional coverage elsewhere.  Just 5% of those enrolled in the Medicare prescription drug benefit chose the plan design that Congress created, 95% chose plan designs developed by the private sector. These facts certainly call into question promises that the government can develop and run a workable health plan for those under 65.”