ICYMI: At Hearing, Senator Warren Calls for Cracking Down on Overpayments in Medicare Advantage; Using Savings to Expand Medicare Dental Coverage
CMS Should Finalize Proposed Rule to Ensure Payments to Medicare Advantage Accurately Reflect the Cost of Care Warren: “We can spend nearly $1 trillion dollars in overpayments to insurance companies for crummy coverage that beneficiaries don't use or we can crack down on the abuses and use this money to pay for the dental care that people actually need.”
Washington, D.C. — At a hearing of the Senate Finance Committee, Subcommittee on Health Care, U.S. Senator Elizabeth Warren (D-Mass.) questioned Chief Economist and Vice President of the American Dental Association’s Health Policy Institute Dr. Marko Vujicic and Meharry Medical College Dean and Professor Dr. Cherae M. Farmer-Dixon on the disparities in dental coverage for seniors in traditional Medicare and Medicare Advantage (MA). Senator Warren highlighted how low-quality dental coverage in MA leads to high out-of-pocket costs that make beneficiaries less likely to access care.
She also urged CMS to finalize the Calendar Year (CY) 2024 Advance Notice of Methodological Changes for MA Capitation Rates and Part C and Part D Payment Policies (the Advance Notice) and take additional steps to end insurance industry scams that lead to billions in overpayments to MA plans. Senator Warren referenced a recent analysis predicting that MA plans will be paid nearly $1 trillion more over the next eight years than the government would pay if beneficiaries remained in traditional Medicare.
“The truth is that MA plans have been overcharging Medicare for years and the most recent report suggests they’re going to rack up nearly $1 trillion dollars in overpayments by 2031,” said Senator Warren. “And it won't just be taxpayers who foot the bill for these overpayments. (Traditional) Medicare beneficiaries will also pay nearly $150 billion in higher Part B premiums.”
Senator Warren called for cracking down on these industry abuses and using the savings to expand dental coverage in Medicare to ensure all beneficiaries get the critical care they deserve.
Transcript: “An Oral Health Crisis: Identifying and Addressing Health Disparities”
U.S. Senate Committee on Finance, Subcommittee on Health Care
Wednesday, March 29, 2023
Senator Elizabeth Warren: So since Medicare was established in 1965, it has not covered routine dental benefits. That means no fillings, no extractions or even preventive care like cleanings. As a result, seniors are more likely than any other age group to lack dental insurance and nearly half of all Medicare beneficiaries – about 24 million people – report that they did not have dental coverage in 2019.
Now, while Medicare is prevented from covering almost all dental benefits, the government has created an exception for the private health insurance plans that offer Medicare Advantage or MA. Under this system, MA plans can offer supplemental benefits that cover services that are not available under traditional Medicare and, not unsurprisingly, dental benefits are a very popular offering. In fact, 96% of MA enrollees were in plans offering some dental coverage in 2022.
But, even seniors who are able to access dental services may face hurdles in getting the care that they need. Dr. Vujicic, almost all MA beneficiaries are in plans that offer dental care. We’ve got almost all of them. But what do we know about the quality of the coverage they're getting?
Dr. Marko Vujicic, Chief Economist and Vice President, Health Policy Institute, American Dental Association: In a nutshell, the research suggests strongly Medicare Advantage Dental has very little impact on utilization of dental care, as well as oral health outcomes themselves. I could elaborate more –
Senator Warren: But tell me the principal reasons why that’s so.
Dr. Vujicic: Well, for example, a third of those plans have cost sharing for prevention. When they do offer more than prevention fillings extractions, like you said, the most common coinsurance rate is 50%. So I mean, I challenge us to think if a heart valve replacement was 50% coinsurance, we certainly would complain about affordability of cardiac care. Those are some of the key parameters –
Senator Warren: Okay, dollar caps, service frequency limits, required co-pays –
Dr. Vujicic: Correct.
Senator Warren: All right, very helpful. In fact, a new study found that seniors in MA used even fewer services than beneficiaries in traditional Medicare. So while millions of Medicare beneficiaries don't have access to dental care, the ones that do may have such high out-of-pocket costs that effectively they don't.
According to the Kaiser Family Foundation, Medicare beneficiaries who use dental services paid about $875, in average out-of-pocket costs in 2018. One in five spent more than $1,000. Dr. Farmer, in your experience as a dentist, if a patient faces high out of pocket costs, are they more likely or less likely to get the care that they need?
Dr. Cherae M. Farmer-Dixon, Dean and Professor, School of Dentistry, Meharry Medical College: They're less likely to get the care that they need, because they can't afford those out-of-pocket costs.
Senator Warren: Okay, so seniors are more likely to avoid getting dental care if they know it's going to mean spending a lot of money out-of-pocket. It seems to me the solution is clear. It's time to expand Medicare to cover dental care, something I have long supported, but critics say is going to be too expensive.
But the truth is that MA plans have been overcharging Medicare for years and the most recent report suggests they’re going to rack up nearly $1 trillion dollars in overpayments by 2031. And it won't just be taxpayers who foot the bill for these overpayments. Medicare beneficiaries will also pay nearly $150 billion in higher Part B premiums. So Dr. Vujicic, how much would it cost to add a dental benefit to Medicare?
Dr. Vujicic: The estimates range from $23 billion per year up to $32 billion per year, depending on how the benefits are designed and the parameters etc., but that's the range from the research.
Senator Warren: Okay, so $23 to $32 billion a year. Or we can spend nearly $1 trillion dollars in overpayments to insurance companies for crummy coverage that beneficiaries don't use or we can crack down on the abuses and use this money to pay for the dental care that people actually need.
Now, CMS has recently proposed a rule that takes steps to ensure that payments to MA plans more accurately reflect the cost of providing care CMS should absolutely finalize this rule. But I want to argue here CMS needs to go further and end these insurance industry scams and ensure that beneficiaries get the care they need. We could use this money to provide the dental care that people across this nation need.
I appreciate all of you being here. I appreciate you for holding this hearing. There’s such an obvious way for us to provide a solution here if we just have the political will to get it done. Thank you. Thank you, Mr. Chairman.
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