House Republicans are convening a group to study implementation of Medicare medical savings accounts to make sure rules governing the program do not discourage beneficiaries from using such plans.
The final version of balanced-budget legislation that Congress recently passed would allow Medicare beneficiaries for the first time to use a capitated government payment to join high-deductible private health insurance plans. The beneficiaries could then put money that otherwise would have been spent on more comprehensive plans into medical savings accounts, or MSAs.
Seniors could draw money from the MSAs to cover routine medical costs.
It isn't certain, however, whether Medicare MSAs will be included in a compromise balanced-budget plan being negotiated by Republican congressional leaders and President Clinton.
But members of Congress who have joined the implementation group, along with MSA advocates, said regulators responsible for developing the program could discourage participation in MSAs by adjusting payments for age, geography and health status so that MSA-plan enrollees get less money from Medicare.
Others argue that such lower payments are justified because MSA-plan enrollees will be younger, healthy and less-risk-averse Medicare beneficiaries.
The Congressional Budget Office projects that about 2% of Medicare beneficiaries would be enrolled in MSA plans by 2002 under the congressional plans.
The CBO said that enrollment trend will cost the federal government $3.5 billion to $4 billion over seven years because more healthy beneficiaries will join MSA plans, reducing the savings that otherwise would have accrued to the traditional Medicare program.