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Private Medicare Policies Hit by New Restrictions

Private Medicare Policies Hit by New Restrictions

The Obama administration has hit the private Medicare policies with lots of new restrictions recently. All this is done in order to save the money of the Government and also of the Medicare seniors, who were unusually charged by many private insurers on the pretext of better coverage and benefits. Plus, these new restrictions have also been proposed to curb the liberty of the private insurers in designing health plans, which are mainly profitable to them and lesser for the members. In addition to this, the administration also proposed to reduce payments to these insurers. This article enumerates detailed facts of the story.

The administration of President Barack Obama has imposed new restrictions on the private health care policies, which are common among the senior patients subscribed with Medicare. However, the administration has condemned these plans for promoting maltreatments and higher expenses for the US Government.

The executives of the administration remarked that, the new modifications identifying the different versions of Medicare policies which are sold by the insurance providers are to daunt these providers from changing the prices for the patients, affected with chronic illness and prohibiting the intermittent habit of taking more money from the patients, in lieu of branded medicines. This not only consumes excess money but also discriminates branded drugs from that of the generic medicines, which is not at all wanted.

The Administration executives ambiguously stated these things, since the announcements were not made public earlier. Shortly, an official declaration was scheduled on March 30, 2009.

The new regulations mirror the initiatives of the Obama administration to place its mark on the private Medicare policies, which thrived under the Republican leaders and were ultimately viewed by several Democrats, as discouraging the conventional program. Prominent insurance companies like Humana and United Healthcare provided such policies.

Around 10 million elderly customers of Medicare received complete health care coverage via these policies, and a further of 17 million recipients is enrolled with private prescription drug coverage plans. Each year an open enrollment period is declared in which the customers are given the chance to enroll for a new plan or switch from an old plan to a new one.

The administration took another discrete step in which it suggested 3.75% reductions in spending, to almost of the private Medicare policies, which offers coverage to the senior patients. Insurance providers claim that the reductions can go up by 5% for several policies and these insurers will have no other option but to compensate the Government spending cuts by increasing the rate of premiums and reducing the benefits.

On March 30, 2009 the new regulations with the latest amendments were issued and the new rules and restrictions were announced to the private insurance providers. It would be applicable when they would offer coverage from the year 2010.

The Administration stated that few of the Medicare policies have been stopped from continuing in order to minimize perplexity, without compromising on the options of the availability of coverage. There are several insurance providers who offer many deviations in a fundamental policy. Around 1,400 policies among 7,000 have less than 10 subscribers. Medicare has planned to strictly analyze the private policies bids for the year 2010 in order to remove the so-called insurer promised benefits, which causes chaos and complications in the basic policy.

Medicare has also planned to carefully analyze the pricing strategies, which are attempted to change/alter the prices to the senior Medicare members, and those affected with chronic disorders.

The Insurance providers are given substantial flexibility to outline their Medicare health insurance policies. For instance, many insurers provide policies that demands excess co-pays from the patients for staying in a nursing home and get treatment. It is much higher in comparison to the original Medicare program. The Obama administration has planned to oppose such plans, as it may show favoritism for people affected with cancer with those having other types of chronic illnesses.


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