"...government is paying private industry to take Medicare off its hands."

[DeepModem Mom]

NYT: Luring Customers From Medicare
By MILT FREUDENHEIM
Published: September 22, 2006

For years, private insurers have offered alternatives to the federal Medicare program that are meant to give patients lower-cost options than the government coverage provides. More than 7 million people now subscribe to such plans, out of a total Medicare population of 42.5 million.

But suddenly a type of private insurance plan is gaining ground that looks very similar to the basic coverage long available to anyone with a federally issued Medicare card.

And the government is paying the private insurance industry a subsidy of 11 percent per patient, on average, to provide it.

Since the government substantially increased the subsidies two years ago for these most basic private industry plans — known as private fee-for-service — enrollment in the plans has grown tenfold to 820,000. About 18,000 people signed up in August alone, Medicare said yesterday in its latest update. And some analysts expect enrollments to double or even triple by 2009.

The $7 billion that Medicare will pay private industry this year to provide this fee-for-service coverage is at least $770 million higher than the government would spend covering those patients itself, based on the 11 percent calculation.

Critics see the trend as further evidence that the government is paying private industry to take Medicare off its hands....

http://www.nytimes.com/2006/09/22/business/22medicare.html

[rodeodance]

1. the 'gov' likes spending that is NOT theirs----for INsurecance profit!

[williesgirl]

2. Gov SAVED ins companies by instituting Medicare, now SAVES

them again by paying them premiums to reduce Medicare expense while actually growing it. All they're doing is adding to ins cos profits at taxpayers expense. Nice campaign contributions is another end result. Put them all in jail!