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Obama Leaves Public Option Out of Reform Plan

Janice Simmons, for HealthLeaders Media, February 22, 2010

Tax credits. The President's proposal changes the cost-sharing assistance for individuals and families relative to the Senate bill: Families with income below $55,000 would get extra assistance, with additional funding to insurers to cover between 73% and 94% of their healthcare costs. It provides the same cost-sharing assistance as the Senate bill for higher income families and the same assistance as the House bill for families with income from $77,000 to $88,000.

Fraud, waste, and abuse. Obama emphasizes aggressive policies to tamp down on fraud, waste, and abuse. The President's proposal would establish a comprehensive Medicare and Medicaid sanctions database that the Department of Health and Human Services' Inspector General would oversee.

Registration and background checks of billing agencies and individuals would be increased to hold down dishonest billing practices in the Medicare program.

Donut hole. The President's proposal calls for filling the Medicare prescription drug donut hole entirely. It begins by replacing the $500 increase in the initial coverage limit, with a $250 rebate to Medicare beneficiaries who hit the donut hole in 2010. The hole would be closed completely by 2020.

Medicare Advantage. The President's proposal would create a new set of benchmark payments that would be gradually phased in to avoid disruption to beneficiaries. It would also provide bonuses for quality and enrollee satisfaction.


Janice Simmons is a senior editor and Washington, DC, correspondent for HealthLeaders Media Online. She can be reached at jsimmons@healthleadersmedia.com.

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