The Medicare Affordability and Enrollment Act of 2016

On September 21, Senator Wyden, the ranking member of the Senate Finance Committee, Congressman Frank Pallone, the ranking member of the House Energy and Commerce Committee and Congressman Sander Levin, the ranking member of House Ways and Means Committee, along with several of their Democratic colleagues, introduced “The Medicare Affordability and Enrollment Act of 2016” (S. 3371 and H.R. 6109), which would update the Medicare program to improve both beneficiary affordability and the enrollment process.

Generations of Americans owe a lot to the Medicare program, for the security and peace of mind that has provided to millions of disabled and elderly Americans and their families, who don’t have to worry if basic medical care will be covered for their loved ones.

But there is no question that this bill – and other changes to Medicare — are overdue. So much of how Medicare operates has not changed much since the program was created in 1965, and the out-of- pocket costs and outdated enrollment procedures need to be modernized. For example, the legislation would create an out-of- pocket cap for traditional Medicare which already exists for Medicare Advantage and most commercial insurance plans. It would also streamline the enrollment system to make enrollment easier, and reduce late-enrollment penalties that are now paid in perpetuity.

However, this bill does not come cheap, and there are other changes that need to be made to Medicare beyond this legislation if we truly want to bring the program into the 21 st century. Today, too many Medicare dollars are paid on the basis of the volume of services, not for high quality care, for good outcomes, or for value.

There is good work being done at CMS, on Capitol Hill and around the country to make Medicare more efficient and more sustainable. At CMS and the Center for Medicare and Medicaid Innovation, much has been done on bundled payments, ACOs, on Value Based Insurance Design, implementing MACRA and developing alternative payment models for physicians to name but a few. Members of Congress are hard at work on bills like “The Medicare Affordability and Enrollment Act of 2016” and “Medicare Post-Acute Value-Based Purchasing Act of 2015,” not to mention the Senate Finance Committee’s Chronic Care Working Group.

But it will be soon be time for Congress to move legislation designed to achieve greater affordability and value in Medicare….to look for ways to deliver better care at lower costs in provider reimbursement AND in benefit design as well.

We need a new Medicare paradigm, one that focuses on affordability, value and innovation; one that can keep up with our ever changing health care system. Senator Wyden’s legislation is one crucial part of creating that paradigm, but there is much more that needs to done.