If you think there is no hope to cut down on healthcare costs, think again. Reducing waste in Medicare and maintaining it to help seniors for many years has been tackled with a new bidding system.
This change will bring the cost of common medical devices and consumables to levels that will help older people get the care they need to stay home, such as diabetic supplies, oxygen equipment and wheelchairs. According to several government reports, a paid system, as used by Medicare, is often exposed to fraud.
Can Medicare reduce costs nationwide by one third?
A new national bidding system is expected to cut Medicare costs by an average of 32 percent. It is also expected that the average savings in states like Florida will be even greater. These savings can benefit not only the elderly, but also the taxpayers.
Here is an example of this cost reduction: In Central Florida, the cost of an oxygen concentrator averages $ 173.17 per month. That could drop to just $ 115 a month. Nine recreational areas in Florida are expected to participate in the new system early next year. As this bidding system spreads across the country, it is estimated that it will save an estimated $ 17 billion in a single decade, according to Medicare Deputy Administrator Jonathan Blum.
Will Medicare Advantage Plans Change?
These and similar savings took off in 2011, unless efforts to torpedo the new bidding system counteract it. The then US Rep. Kendrick Meek tried to stop the new system but did not have much success.
With such drastic cuts in medical equipment and consumables costs, the Medicare advantage industry could feel the pressure of the government and the public to either cut premiums or extend the benefits of the plan. If Humana 2019 Medicare Advantage plan Insurance spends less, why not return at least a portion of the savings to seniors?
And the winner is…
Several medical devices and utilities already bided for it, and the Centers for Medicare & Medicaid Services applied for contracts. Their final decision came up in September, so it took a while to see if the new system will lower the premiums or increase the benefits of the Medicare Advantage Insurance Plan.
There is also the possibility that companies that do not receive contracts can successfully lobby the Congress to thwart the system. With Medicare already running empty, this seems like a long story. This new bidding system, the upcoming health care reform and the aging US population will affect Medicare Advantage Insurance in the coming years. One way to stay that way and be sure to get the benefit of lower premiums and / or extended coverage is to require an annual review of these plans.
In the long run it is worth looking around while your health makes it easier to change plans. It is almost impossible to switch to different plans if your health deteriorates. Compare new plans when they hit the market on a regular basis, and you’ll be more likely to find better values and save more on your hard earned retirement savings.