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Don’t Expect Immediate Changes in Medicare Following President Trump’s Executive Order

Oct 5, 2019
Originally published on October 4, 2019 3:45 pm

President Donald Trump is pledging to protect Medicare.  The president visited The Villages in central Florida – a collection of communities for residents 55 and older.  He announced and signed an executive order aimed at protecting and improving Medicare coverage.

Trump also used the event as an opportunity to tout his administration’s health care goals and achievements. He criticized the proposals set forth by his Democratic rivals, which he called socialism.

What will the executive order change? Amy Goldstein, Health Care Reporter for the Washington Post provided some insight on The Florida Roundup.

Transcript was edited for clarity

Florida Roundup: What did you hear from the president this week in Florida in regards to his stated purpose of trying to expand these Medicare Advantage private health plans?

Amy Goldstein: I think the big picture way to think about what the president was doing in Florida is that if you ask voters what they care about, they care about what Congress is doing to improve things in this country. or what they care about in advance of the 2020 elections. Health care ranks very, very high. And if you ask people what parts of the health care system they like, what ones they think are going well —Medicare ranks very, very high. So, I think what you're seeing now are both political parties both this big field of Democratic candidates. And yesterday, the president trying to seize Medicare for his own political advantage saying, ‘You know, I'm the one who is really going to do right by you in the health care system.'

Florida Roundup: It was interesting, right? The president came out saying as long as I am president no one will lay a hand on your Medicare benefits. Just a few years ago, under Paul Ryan as speaker of the house, Medicare and Social Security benefits were looked at by the Republican Party as places to save federal government spending.

Amy Goldstein: That's right. I was really struck by the president's line yesterday. It was the end of his speech: 'With every ounce of strength and every bit of so we are going to protect Medicare for you.' I mean, that really summed up what he was in Florida to talk about.

Florida Roundup: Yeah. And is he acknowledging some kind of pressure that's on Medicare spending from Congress? Does that exist?

Amy Goldstein: Well that's kind of the irony of where both political parties are at the moment. You know ... I've covered health care off and on for a very long time. And it used to be that there were presidential commissions that were looking at the future of Medicare because the concern is with so many people aging in this country and living longer and with new medical techniques getting developed, new drugs that are effective but cost a lot that Medicare is going to start running out of money.

That could concern about the fiscal health of Medicare is not really what either party is talking about. What the president was doing is talking about ways that, as you said, the private sector part of Medicare, which has been known since the early 2000s as Medicare Advantage, could be strengthened.

He has some very specific ideas for that that he incorporated into this executive order that he signed at the end of his speech. That really had nothing to do with expanding benefits for more people, which is what the Democrats are talking about. Nor did it do with the fiscal health of the program.

Florida Roundup: One thing that the president did do was to sign this executive order with multiple pieces that aim to expand Medicare Advantage, the private insurance piece of Medicare. But before we get into specifics — can the president do that with the stroke of a pen or does Congress have to act?

Amy Goldstein: What the president was doing was basically issuing a directive to the people working for the administration and the Department of Health and Human Services, asking them to study a whole series of things that slightly changed the nature of private sector Medicare and then develop new federal regulations or federal rules that would embrace those changes. So what he was doing yesterday wasn't changing the program immediately. It was setting some changes in motion.

Let me just say so that people understand that the notion of people being in private health plans as a form of Medicare has been around for a few decades and it's been growing increasingly popular now. About one third of the people on Medicare or about 22 million people are in either HMO PPOs or a preferred provider organization — some kind of managed care plan. That's where they're getting their Medicare coverage.  

Florida Roundup: One of the things that struck me about what the president did in the executive order was looking at the fee for service traditional Medicare. So every doctor's visit, every lab test comes with a price to more closely match prices paid by services under the managed Medicare Advantage plans, which of course are generally more kind of fee for care or negotiated rates. What kind of effect could that have on prices?

Amy Goldstein: Well, it depends. I mean the whole question of what should health plans be paid within Medicare has been a political debate for many years and Democrats tend to think that well managed care is an efficient way of providing care. It controls what services people are getting to a greater degree and therefore is a cost saving way of providing Medicare.

On the other hand, Republicans tend to think that the private sector is just a better way of delivering health care .... So it's sort of gone back and forth. What these health plans are paid depending on who's running Congress and who's in the White House. 

For your specific question, what the executive order does — and it does a whole bunch of things — but one of them is to kind of level out the playing field when people are making their first decisions to enroll in Medicare in the first place when they turn 65 or otherwise become eligible for Medicare so that there's not kind of a steering into either the traditional version of the program or this private sector version of the program.

Whether that will make a difference is hard to say as younger people have been turning 65 compared to the people who were turning 65 a few generations ago, when there wasn't much thing called managed care. There's already been every year an increasing proportion of new Medicare patients who are joining Medicare Advantage.

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