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Life Health > Health Insurance > Medicare Planning

Lawmakers Unveil Separate Medicare Bills

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The top members of the Senate Finance Committee have introduced separate proposals for cutting the Medicare Advantage program budget and setting new program marketing rules.

Sen. Max Baucus, D-Mont., the committee chairman, has unveiled S. 3101. That bill that would cut Medicare Advantage funding by $13 billion over 5 years, according to the Congressional Budget Office.

Sen. Charles Grassley, R-Iowa, the highest ranking Republican member of the Finance Committee, has introduced an alternative that does not yet have a bill number. CBO analysts say the Grassley bill would cut the Medicare Advantage budget $12.5 billion over 5 years, partly by phasing out payments to Medicare Advantage providers for indirect medical education.

The bills are part of an effort to reduce funding for some components of Medicare, to pay to roll back an 11% cut in Medicare physician fees. Unless Congress acts, the physician fee schedule cuts will take effect July 1.

Baucus and Grassley often join to introduce bipartisan bills, but their effort to introduce a joint Medicare Advantage bill broke down several weeks ago.

Observers are predicting that the Senate will reject both the Baucus bill and the Grassley bill, but they say the Senate could vote on the Baucus bill by early next week.

Grassley says President Bush would sign his bill but would veto the Baucus bill.

The “issue is that Congress is asking seniors to pay for the physician fix,” says an official at America’s Health Insurance Plans, Washington.

It is important “for Congress to look at the effect these cuts will have on seniors living in their districts,” the official says.

The Medicare Advantage marketing provisions in the bills are similar and are based on an agreement negotiated with AHIP in March.

One provision in S. 3101, the Baucus bill, would exempt the value of life insurance from being used in the calculations made to determine whether individuals are eligible for the subsidies aimed at low-income beneficiaries.

That provision apparently would retain current law, according to Jack Dolan, an official at the American Council of Life Insurers, Washington.


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