Witness: Combine Medicare Part A and Part B

Robert Moffitt, a health policy analyst at the Heritage Foundation says Congress ought to try to combine the Medicare Part A hospitalization program with the Medicare Part B outpatient and physician services program.

Coverage fragmentation “adds to the administrative cost, complexity and confusion for beneficiaries, and hinders coordination of care,” Moffitt testified today at a hearing on Medicare organized by the House Ways and Means health subcommittee, quoting a Commonwealth Fund analyst.

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Combining the hospitalization and physician services programs into a single program, with a single deductible and uniform coinsurance, would be a good way to reduce the complexity of the traditional Medicare program, Moffitt said.

When Congress combines Part A and Part B, it should reform the rules governing the Medicare supplement (Medigap) insurance program, Moffitt said.

Medigap products fill in the gaps left by the traditional Part A and Part B programs. Congress recently passed a law that will soon ban the sale of new Medigap plans that pay the full cost of the Part B deductible. But current Medigap plans still cover too much of traditional Medicare users’ out-of-pocket costs, Moffitt said.

That “stimulates excessive utilization,” Moffitt said.