The private sector may do a better job of controlling Medicare costs than the federal government, according to congressional testimony today and a study in the May/June issue of Health Affairs. Medicare beneficiaries enrolled in private managed-care plans pay approximately $1,600 less out-of-pocket every two years than those in the traditional Medicare program, the study said. However, the authors noted that there's evidence Medicare HMO benefits have eroded since the time period studied. Meanwhile, the Senate Special Committee on Aging heard testimony supporting the federal employee benefits program as a potential model for a streamlined Medicare. Although Medicare has 1.5% to 2% lower administrative costs than private insurers, hospitals and other providers must comply with Medicare's "regulatory regime," taking resources away from patient care, said Robert Moffit, director of the Center for Health Policy Studies at the Heritage Foundation. Read an abstract of the Health Affairs study. -- by Jeff Tieman
Study, experts tout private sector's cost control
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