Downstate Illinois labor council passes resolution opposing third-party Medicare pilot

The Labor Council of West Central Illinois on Nov. 28 unanimously passed a resolution criticizing Medicare pilot program ACO-REACH, and asking President Biden to stop it before it takes effect in January.

 

ACOs (Accountable Care Organizations) differ from managed-care plans and the “Medicare Advantage” plans promoted in TV commercials featuring by ex-athlete Joe Namath, comic Jimmie Walker, actor William Devane, et. al. The experimental ACO programs open up Medicare management to private, for-profit ventures.

 

The area labor council’s resolution was based on a document written by Chris Cruz of the Texas Alliance for Retired Americans. (See below for its text.)

 

“We are extremely concerned about the planned ACO-REACH changes to Medicare,” said Labor Council president Lisa Uphoff.

 

A national campaign against ACO-REACH (Realizing Equity, Access and Community Health) in recent weeks has seen other labor groups getting involved. Some who’ve taken action include the Alameda (Calif.) Labor Council, the Austin, Texas, AFL-CIO Labor Council, International Association of Machinists District 751 retirees, the Troy (N.Y.) Area Labor Council, and the Washington State Labor Council.

 

ACO-REACH’s roots date to the Affordable Care Act empowering the Centers for Medicare and Medicaid Services (CMMS) through its Center for Medicare and Medicaid Innovation division to try pilot programs to improve Medicare, and the Trump administration in 2019 initiated Direct Contracting Entities (DCE), which opened up Medicare to private companies that aren’t health providers. 

 

Medical reporter Trudy Lieberman from the Center for Health Journalism said, “This latest under-the-radar program could push Medicare deeper into private hands.”

 

Biden did cancel DCE in 2021, replacing it with ACO-REACH, and CMMS claims that ACO-REACH “increases provider governance and transparency, provides a focus on health equity, and makes improvements to risk adjustments.”

 

But Medicare advocates say ACO-REACH would retain many of DCE’s troubling features. For example, both DCEs and ACO-REACH permit private equity investors, private insurers, hedge funds and other businesses to be middlemen in traditional Medicare.

 

The national Alliance of Retired Americans has expressed concerns “about the potential for the ACO REACH model to pull Medicare beneficiaries out of traditional Medicare and into private plans without their knowledge or consent.”

 

For years, criticisms of such ACOs ranged from the lack of transparency and risks of hiking Medicare costs, to increasing the difficulty for patients to access health care, and a step toward privatizing Medicare.

In an essay in The Hill, U.S. Rep. Pramila Jayapal (D-Wash.) and Dr. Susan Rogers of Physicians for a National Health Program said there’s an urgent need to end the program.

 

“As a physician and a member of Congress, we’ve never heard a senior ask for their health care to be more complicated, or to have their choice of traditional Medicare taken away,” they wrote. “But that’s exactly what Direct Contracting would do. Traditional Medicare has proven its value for more than half a century. Instead of selling it off to the highest bidder, let’s strengthen and improve its benefits while working to expand it to cover every American.”

 

ACO-REACH companies have an incentive to limit care since funds not used for patient services can also be kept by the private ventures.

 

Dr. Abdul El-Sayed, former health director for Detroit, said, “Everyone from traditional health insurers to private equity firms are lining up to cash in. But Direct Contracting isn’t a matter of law; Congress never voted on this. It’s just a pilot program designed by the Trump administration … that the Biden administration is now carrying forward. They could kill Direct Contracting in its tracks if they wanted to.”

 

For more information, check out https://protectmedicare.net/ or write Kay Tillow, coordinator

Unions Committee for Single Payer Health Care, P. O. Box 17595, Louisville, KY 40217.

 

Resolution to stop a new Medicare program backed by the Trump Administration and now called Medicare ACO-REACH

WHEREAS when seniors and retirees become eligible to apply for Medicare, the majority of them choose Traditional Medicare (the original program where Medicare pays the participating doctor directly) versus the Medicare Advantage Program, a “third party for-profit middleman insurance company” that is paid monthly by Medicare to manage patient’s care and authorizes payment to the patient’s doctor; and

WHEREAS the former Trump administration supported a new pilot Medicare program created by a section of CMMS called CMMSI (Center for Medicare & Medicaid Services Innovation), and the new Medicare program named ACO-REACH (Accountable Care Organization-Realizing Equity, Access, and Community Health) claims to be a new Medicare value-based payment demonstration model, but it is actually a “third party for-profit insurance company” program that will rapidly drain away the Medicare Trust; and

WHEREAS this new program is set to be launched on January 1, 2023, with no current Congressional oversight; and

WHEREAS According to Physicians for a National Health Program, ACO-REACH allows doctors and their offices to convert a patients’ Traditional Medicare choice into ACO-REACH coverage without first informing their patients about the change nor getting their patients’ written permission; and

WHEREAS doctors and their offices will have a financial incentive to convert to ACO-REACH coverage as they will also be allowed to keep up to 40% of their revenue that they don’t spend on health-care services as overhead resulting in a “windfall profit” versus Traditional Medicare Programs that are only allowed to keep the balance of 2% of their revenue after paying for overhead;  and

WHEREAS doctors and their offices will have an additional financial incentive as ACO-REACH will pay money to treat their patients with more complicated diagnoses by allowing doctors to “up code” additional diagnoses. (Up-coding is a practice that has led to fraud by exaggerating or including related, but unnecessary, diagnoses, leading to higher costs); and

WHEREAS President Biden at an April 2019 rally in Pittsburgh – where he kicked off his campaign for the White House – called himself a “union man,” and

WHEREAS if the Biden/Harris Administration does not stop the deployment of Medicare ACO-REACH by HHS/CMMS now, it potentially could make things worse since the Congressional Budget Office has already projected the insolvency of the Medicare Hospital Trust in 2026 that could affect 52.6 million seniors whose care is provided by the Trust,

NOW THEREFORE

BE IT RESOLVED that the Labor Council of West Central Illinois opposes CMMSI’s Medicare ACO-REACH program and respectfully asks the Biden/Harris administration to immediately stop and dismantle the ACO-REACH Program, and instead, immediately protect and preserve Traditional Medicare plus adding coverage for Hearing, Vision and Dental Care.