01.23.08

Schumer, Clinton Introduce Bill To Require Parity For Suffolk County's Medicare Advantage Payments, Will Save Suffolk's Seniors Millions

New Legislation Will Fix Technical Glitches That Currently Cost Suffolk Seniors Millions More than Nassau Counterparts Due to Lower Medicare Advantage PaymentsBill Ensures Equality Between Suffolk and Nassau Payments, Allowing Health Insurance Companies to Reduce Premiums for More than 30,000 Affected Suffolk County SeniorsSchumer, Clinton's Solution Will Permanently Solve Inequity between Nassau and Suffolk

U.S. Senators Charles E. Schumer today announced that he has introduced new legislation, adjusting the Medicare Advantage Benchmark for certain counties including Long Island, that will permanently fix the inequity between Suffolk and Nassau County's Medicare Advantage payments that currently cost Suffolk County's seniors millions more in health insurance premiums than their Nassau counterparts. While Nassau and Suffolk have comparable numbers of patients and facilities, Suffolk County has received millions less in Medicare Advantage payments than Nassau since 2003 because Medicare does not count health care provided at the Northport Veterans Affairs (VA) Medical Center to Medicare beneficiaries, even though by law Medicare is required to take VA services and patients into account. The lower payments mean that Medicare Advantage plans have had to raise premiums dramatically in Suffolk above what they charge in Nassau for the same or similar coverage. Schumer's bill, cosponsored by Senator Hillary Rodham Clinton, requires that payments to plans in Suffolk and Nassau counties are equal, thus removing one more barrier to lower premiums for Suffolk seniors.   Without the legislation, Suffolk County seniors would pay roughly $2 million more in premiums this year because of the disparity, with many other plans pulling out of Suffolk County completely.

 

"Suffolk and Nassau County seniors experience the same health problems, there's no reason they shouldn't receive the same access to affordable care," Senator Schumer said. "My bill will ensure that Medicare Advantage works for Suffolk seniors just like it does for those in Nassau, by providing access to affordable care for everyone who qualifies. By addressing this inequity in the Suffolk County benchmark, we can pump much needed federal funds into Suffolk's health care system, and I will fight tooth and nail to ensure that those dollars mean lower insurance premium payments for Suffolk's seniors."

 

"It is time to knock down this barrier to lower premiums that has cost Suffolk County seniors more than their fair share when it comes to their Medicare payments," said Senator Clinton. "We should not be forcing Suffolk's seniors to bear the burden of these additional costs through no fault of their own. I am proud to support this important legislation that will help level the field and ensure that Medicare Advantage works for all of Long Island."

 

Under the current system, Medicare pays health insurers and managed care plans to provide health coverage for services such as doctor's visits, hospitalizations, and prescription drugs. The Medicare Advantage payments are calculated on a countybycounty basis using a complex formula that takes in the account the Medicare population and the number and value of health care services and facilities serving those Medicare beneficiaries. However, while Nassau and Suffolk have comparable numbers of patients and facilities, 30,402 seniors in Suffolk County and 36,742 in Nassau, Suffolk has received millions less than Nassau over the past six years because Medicare does not count health care provided at the Northport VA to Medicare beneficiaries, even though by law Medicare is required to take VA services and patients into account. The lower payments mean that Medicare Advantage plans have had to cover the costs and in some cases, raise premiums dramatically in Suffolk above what they charge in Nassau for the same or similar coverage.

 

Right now, the major managed care plans operating in both Suffolk and Nassau counties charge far higher premiums for seniors in Suffolk than in Nassau. For similar health coverage, HIP charges $99.50 per month in Suffolk and no monthly premium in Nassau. Empire BlueCross Blue Shield charges Suffolk County seniors $69.00 per month, but doesn't charge any monthly premium at all in Nassau. In addition, the disparity in payments between Nassau and Suffolk may have driven several plans out of Suffolk including Healthfirst 65, Liberty Health, and WellCare Choice, who all offer $0 premiums in Nassau but don't offer any coverage at all in Suffolk.

 

Schumer's legislation will address this inequity by providing a permanent adjustment for Medicare Advantage benchmarks on Long Island and in similar areas across the country. To qualify under the bill, targeted areas must:

  • Be contiguous counties;
  • One of which has a Department of Veterans Affairs medical center; and
  • Both must use Medicare rebasing payment methodology
  •  

For counties that qualify, the legislation requires that both counties receive equal Medicare Advantage repayments, equivalent to whichever county is deemed to have the higher rate under the rebasing methodology. Therefore, under the bill, Suffolk's payments will be brought up to the level of Nassau's payments. Nassau's payments will not be affected. With equal Medicare Advantage payments, health care providers on Long Island will have one less barrier to lowering premiums in Suffolk.

 

Without the legislation, the per patient, per month benchmark for Suffolk County for 2008 would remain $858 compared to $912 for Nassau, translating to approximately $2 million in less funding provided this year to cover the rising cost of health care for Suffolk County seniors.

 

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