New Bill Could Lower Medicare Costs For Millions

A proposed bipartisan bill could reduce what you pay for Medicare, helping you avoid wasting your retirement savings. The Chronic Care Management Improvement Act would eliminate the Medicare coinsurance requirement for chronic care management (CCM) services, saving beneficiaries money every month. The bill might encourage more Medicare beneficiaries to get the care they need, and it already has widespread industry support.

Here's what you should know about how the bill might affect your Medicare and the care you're able to receive.

What the Chronic Care Management Improvement Act could do

Rep. Suzan DelBene (D-WA) and Rep. Mike Kelly (R-PA) introduced the Chronic Care Management Improvement Act to Congress. The proposed bill would eliminate a CCM cost-sharing requirement, reducing the financial burden for Medicare beneficiaries with multiple chronic conditions.

How CCM currently works

CCM coverage is designed for individuals with two or more chronic conditions that are expected to last at least a year. For example, if a Medicare beneficiary has arthritis and diabetes, CCM might pay for a health care provider to help manage the care the beneficiary needs for those conditions.

CCM coverage includes the creation of a care plan that lists details like health problems, goals, providers, medications, and community services. It also includes elements like 24/7 access to urgent care, support when the individual goes from one health care setting to another, and help with chronic care needs.

What CCM currently costs

All of that extra care comes at a cost. Medicare beneficiaries receiving CCM must pay a 20% coinsurance requirement, which usually amounts to about $12 per month. While the amount is fairly small, it could still be difficult for seniors living on fixed incomes to pay on a recurring basis.

How eliminating CCM coinsurance could help beneficiaries

Eliminating CCM coinsurance might encourage more individuals with multiple chronic conditions to take advantage of the care that CCM provides. An analysis of Medicare fee-for-service claims for CCM found that just 4% of Medicare beneficiaries who were potentially eligible for CCM actually received the services. That data reflects that just 882,000 out of a potential 22.5 million eligible beneficiaries received these services.

As more beneficiaries are able to receive CCM care, they might see improved health outcomes. The coordination services offered may help reduce hospital visits and help beneficiaries to receive more timely care. Such coordination might reduce duplicate tests and unnecessary care costs, plus it might help beneficiaries to better adhere to their prescribed medications. Ultimately, CCM care might result in better overall care and health for beneficiaries.

How eliminating coinsurance could help Medicare

Eliminating CCM coinsurance could also potentially help the Medicare program. The Centers for Medicare & Medicaid Services commissioned a study analyzing the cost that Medicare paid for CCM patients compared to non-CCM patients. The study found that over an 18-month period, the Medicare program spent $95 less per patient per month on CCM patients than it did on non-CCM patients.

During a time when health care costs are increasing and government funds are tight, such potential savings could be highly valuable to the Medicare program.

Why the Chronic Care Management Improvement Act has widespread support

The Chronic Care Management Improvement Act has already received enthusiastic support. On April 14, more than 40 health care and patient advocacy groups submitted a letter endorsing the proposal. Those groups included AARP, The American Hospital Association, National Rural Health Association, American Diabetes Association, and more.

The letter stated, "By removing the patient cost-sharing obligations from the Chronic Care Management (CCM) code, millions of chronically ill Medicare beneficiaries stand to benefit from the care coordination and care management services the code supports." 

Proof of CCM's positive effects

CCM's positive effects have already been proven. According to the letter submitted by the health care and patient advocacy groups, since CCM services allow beneficiaries' care teams to cover more aspects of each patient's health, they increase the chance of a positive health outcome.

The letter explains that providers and care managers report beneficial outcomes for CCM recipients, such as increased patient satisfaction and increased patient adherence to recommended therapies. Emergency department visits and reduced hospitalizations have also been reported.

Bottom line

The Chronic Care Management Improvement Act has been formally introduced to the U.S. House of Representatives by Representatives, and it must now move through committee, so we'll have to wait to see if it becomes law and goes into effect. If it does, the bill might expand CCM access, including to seniors on tight budgets who can't afford the coinsurance, as well as to seniors who might not yet be aware that CCM exists.

Living with multiple chronic conditions is often expensive, but a change like the elimination of CCM coinsurance could help you save money. Until the bill becomes official, enrolling in health insurance coverage that best meets your health care needs may help you save on out-of-pocket costs and could be an important part of your retirement plan.

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