Govt. Sells Health Reform to Seniors

May 24, 2010 7:06pm

ABC’s Z. Byron Wolf reports: 

The benefits, taxes and rules mandated by the health reform law that will remake the American health delivery system will only phase in over the next four years. 

But official attempts by the Obama administration to assure the more than 45 million Americans who get government-run health care in the form of Medicare will start this month. 

The government is mailing out a 4-page pamphlet with a message from HHS Secretary Kathleen Sebelius, who tells seniors they will still get the same basic Medicare benefits. The pamphlet has photos of smiling middle-aged seniors, some with their grand kids. And it uses words like “helps,” “expands” and “protects.” And Sebelius points out improvements, including a new $250 with Medicare Part D coverage who enter the dreaded “donut hole” between when regular prescription drug benefits expire and maximum out-of-pocket limits are reached.

Read the full pamphlets here: (English) and

Other areas are massaged more carefully in the brochure. For instance, the law will cut by more than $130 billion over ten years government payments to companies that offer Medicare Advantage plans. 

About one quarter of Medicare beneficiaries are on these plans, which replace normal fee for service Medicare with a bundled plan overseen by a private administrator.

In the mailing to seniors, Sebelius does not use the word “cut,” but instead points out that the government pays more per person for these plans than for fee for service plans.

“The new law levels the playing field by gradually eliminating Medicare Advantage overpayments to insurance companies,” she writes.

While most experts agree that some Medicare Advantage providers will pull out of the market, Sebelius says that the new law will “protect Medicare Advantage members by taking strong steps to ensure that at least 85 % of every dollar these plans receive is spent on health care, rather than administrative costs and insurance company profits.”

She is referring to new rules on so-called Medical Loss Ratios that require all insurers – not just those providing Medicare Advantage plans – to spend between 80 and 85 percent of medical premiums on care. 

Some Republicans on Capitol Hill pointed out that when Insurance Companies, chiefly Humana, sought with a mailer to lobby against passage of the health reform bill, Sebelius and the administrator that oversees Medicare outlawed the communications, drawing accusations of a “gag rule.” 

“The Administration has gone too far with this document and is doing a disservice to America’s seniors who will soon have to deal with over one-half trillion in cuts to the Medicare program… Instead of trying to combat bad poll numbers, the Administration should be helping the millions of seniors who are soon going to lose their Medicare plan and have to start paying more for their prescription drug coverage,” said Rep. Dave Camp, R-MI, in a statement.

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