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Researchers Propose Combining Medicare Plans

By CQ Staff

May 6, 2013 -- Researchers from Johns Hopkins and The Commonwealth Fund are proposing a new structure for Medicare, one that they say could save beneficiaries, employers, and state and local governments a combined $180 billion over a decade.

The paper, published in the May edition of Health Affairs, would combine Medicare's Part A for hospital care, Part B for doctor visits and its Part D prescription drug benefit, along with supplemental coverage, into one plan they call Medicare Essential.

Authors Karen Davis, director of the Roger C. Lipitz Center for Integrated Health Care at The Bloomberg School of Public Health, as well as Cathy Schoen and Stuart Guterman of the Commonwealth Fund, say by offering a comprehensive set of benefits that includes drugs and lower deductibles, their Medicare Essential plan "would offer beneficiaries better financial protection, a limit on out-of-pocket spending and the opportunity for additional savings in premiums and out-of-pocket expenses for those who select high-value health care providers and hospitals that are able to provide quality care while keeping down costs."

Retooling Medicare has been the subject of numerous reports and studies by health economists and researchers. The pace of such research has increased recently as lawmakers say they want to tackle the spiraling costs of entitlements.

"This plan builds on traditional Medicare, which beneficiaries are more satisfied with than private coverage," Davis said in a news release. "But Medicare is overly complex, and it fails to protect beneficiaries against high costs unless they buy supplemental coverage. Medicare Essential would simplify and modernize Medicare for beneficiaries and help keep premiums and out-of-pocket costs reasonable."

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