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Proposed 'Medicare Essential' plan estimated to save $180 billion over 10 years
Date:5/6/2013

New York, NY, May 6, 2013Combining Medicare's hospital, physician, and prescription drug coverage with commonly purchased private supplemental coverage into one health plan could produce national savings of $180 billion over a decade while improving care for beneficiaries, according to a new study by researchers at The Johns Hopkins Bloomberg School of Public Health and The Commonwealth Fund published today in the May edition of Health Affairs. Under the proposed plan, called "Medicare Essential," Medicare beneficiaries could save a total of $63 billion between 2014 and 2023, with total premium and out-of-pocket costs for beneficiaries estimated to be 17 percent to 40 percent lower than current costs.

Private employers enrolled in retiree plans could save an estimated $90 billion, while savings for state and local governments are projected to be $27 billion over 10 years. The savings would come from simplifying administrative costs and rewarding the delivery of high-quality, high-value care.

In Medicare Essential: An Option to Promote Better Care and Curb Spending Growth, Karen Davis, Ph.D., director of the Roger C. Lipitz Center for Integrated Health Care at The Bloomberg School of Public Health, and Commonwealth Fund researchers Cathy Schoen and Stuart Guterman, detail their proposal for a new public insurance plan choice that would simplify Medicare and improve its efficiency. By offering a comprehensive set of benefits that includes medications and lower deductibles, the 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.

"This plan builds on traditional Medicare, which beneficiaries are more satisfied with than private coverage," said Davis. "But Med
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Contact: Mary Mahon
mm@cmwf.org
212-606-3853
Commonwealth Fund
Source:Eurekalert

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