Kaiser Family Website Has Brain Teaser Quiz on Medicare
The Kaiser Family Foundation offers a multiple-choice “Medicare Quiz” on its web site because the subject is such a hot topic these days from a current affairs point of view. Unfortunately most of the quiz’s 10 questions really oversimplify a complex subject to the point that you could not answer the questions accurately without someone from Kaiser standing over your shoulder explaining them to you.
Here are the 10 questions with some background and my answers. I have no idea how recently the quiz was posted so my answers below may not agree with Kaiser’s. I used MedPAC – the Centers of Medicare/Medicaid Services (CMS) in-house version of the Congressional Budget Office (CBO) — as my source. Its most recent report is dated March 2011 and Kaiser may well have access to more recent data.
1. Approximately what share of the federal budget goes toward Medicare, the federal program that provides health insurance to elderly and disabled Americans across all income levels?
In its quiz, Kaiser gives a small range — 5%, 15% or 25% – as choices but is Kaiser looking for share of the budget net of premiums paid by seniors and the disabled or for total Medicare spending? MedPAC says CMS spent around $500 million in 2009 on Medicare (which appears to be the most recent data). MedPAC is so imprecise because it tends to report not in the aggregate but by Medicare Part (A, B, C, etc.) and even by type within Part (hospital, skilled nursing facility, etc. within Part A). In addition MedPAC tends to express Medicare spending as a percentage of GDP or total national healthcare spending, not of Federal budget.
So, to really answer the question you have to go off and find out what the federal budget is. And — if you follow current affairs — you know that the U.S. Congress has not passed a budget in two or three years.
2. What share of all Medicare beneficiaries lived on incomes of less than $22,000 in 2010, including income from Social Security and all other sources?
Question 2 is also hard to answer without some qualifiers. Income is a term that is not necessarily meaningful to most middle-class people of Medicare age. In the best case, we have no income from an IRS point of view. That way we do not have to pay taxes. Instead we draw down from savings. The Social Security Administration gives related information on its web site but clearly says in multiple places “Total income excludes withdrawals from savings and non-annuitized IRAs or 401(k) plans…” So what does Kaiser mean by income?
For less well off seniors, Social Security says its totals exclude “…in-kind support, such as food stamps and housing and energy assistance.” Does that mean Kaiser excluded the Part B and D premium and co-pay/deductible assistance that lower income seniors receive from Medicaid, pharmaceutical companies, State Pharmaceutical Assistance Programs, and Social Security itself through Extra Help?
3. Which one of the following services is not typically covered by Medicare?
Question 3 is not very difficult for those of us on Medicare but surprises everyone younger. Medicare usually has nothing to do with one of Kaiser’s options: “Long-term care services and supports, such as a nursing home stay.” But I say usually because Medicare does cover nursing home stays where skilled nursing is required — up to certain limits — so even Kaiser’s Question 3 is a big “What do you mean?”
4. What share of Medicare beneficiaries has three or more chronic conditions, such as diabetes, arthritis, or osteoporosis?
Again MedPAC has the answer but you have to dig for it. I didn’t but the answer is important because Medicare beneficiaries with multiple conditions are more costly to the Medicare system.
5. Most large employer health plans protect enrollees from extraordinarily high medical bills by placing an annual limit on out-of-pocket costs. Does the fee-for-service Medicare program do this?
Question 5 is another one of Kaiser’s trick questions. The reader has to first find out that “fee-for-service Medicare program” means Medicare Parts A and B. And, no, they do not provide protection against high annual out-of-pocket costs nor is there a lifetime limit. Parts A and B (also called Original Medicare, traditional Medicare, or “Medicare as we know it”) are terrible insurance plans — as also explained by MedPAC — and that’s why 92% of Medicare beneficiaries that do not subscribe to Medicare Part C (see question 8 below) get some kind of private or public supplement to cover their healthcare insurance needs.
(Most Medicare beneficiaries are over 65 but I try not to use the word seniors when describing the Medicare pool. It includes many people under 65 as well.)
6. Do all Medicare beneficiaries pay the same premium for coverage of physician and outpatient services, regardless of their income?
Conventional wisdom says Medicare is insurance but in fact it is a means-tested social-welfare program (and most likely about to become more means tested). People on Medicare with higher incomes pay more per month. Almost all Americans pay tens of thousands of dollars into the Part A trust fund during their working lives (and that trust fund partially flows into Part C as well) but Parts B and D are paid for from general tax revenues and beneficary premium payments.
7. Is Medicare spending expected to grow faster or slower per person than private health insurance spending over the next decade?
Expected by whom, Kaiser? I can find you statistics that will answer this question in either direction.
8. What share of the total Medicare population is enrolled in a Medicare Advantage plan, such as a Medicare HMO or PPO, rather than the traditional fee-for-service Medicare program?
Medicare Advantage is Medicare Part C. The most recent MedPAC numbers say the percentage is 24% (for 2009) but CMS reported enrollment increases of about 10% in both 2011 and 2012 so the percentage probably now exceeds 25%. That’s up from about 11% in 2006. Changes to Part C made during President George W. Bush’s administration have made this program very popular. However, the CBO is estimating that changes to the program passed during President Obama’s administration — which kick in in 2014 — will raise Part C premiums and that the percentage enrolled in Medicare Part C will retreat to the 2005 11% level by 2019.
9. Does the health reform law close the Medicare prescription drug benefit’s “doughnut hole,” or coverage gap, so seniors no longer have to pay the full cost of their medications when they reach the gap?
What President Obama’s administration took away with one hand, it gave back with the other. Whereas Medicare Part C is projected to decline dramatically during the rest of the decade as described in question 8, the deductible in the middle of Medicare Part C — unpopularly known as the donut hole — is scheduled to disappear by 2019. Time will tell if that will simply increase the deductible on the front end or whether prescription drug plan premiums will simply be higher or…
Beneficiaries will also tell you that before 2006, there was no Medicare drug plan. Most seniors are actually very happy about the Part D program. The donut hole just gives us something to complain about. We’re old.
10. Under current law, how soon is Medicare’s Hospital Insurance Trust Fund projected to become insolvent, meaning it will not have enough money to pay the full cost of beneficiaries’ hospital care?
2029 as of MedPAC’s March 2011 report (which I believe to be the most recent). But that only applies to one of Medicare’s revenue/disbursement streams. And MedPac does not use the term insolvent; it says the fund will be exhausted. That’s the way I felt taking this “simple test” from Kaiser.