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UnitedHealth envisions $3.5T savings by restructuring Medicare and

Medicaid
October 18, 2010 | Chelsey Ledue, Associate Editor

WASHINGTON – The nation could save about $3.5 trillion over the next 25
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years by expanding coordinated care programs in Medicare and Medicaid,
according to a new analysis by the UnitedHealth Group’s Center for Health Pennsylvania health plan
Reform & Modernization. to withdraw from 17
counties on Sept. 30
The report, “U.S. Deficit Reduction: The Medicare and Medicaid Modernization
Opportunity,” agues that the current fee-for-service indemnity payment system, Senate targets
which comprises more than three-quarters of Medicare and Medicaid spending, drug-pricing
is one of the primary drivers of fragmented care and rising healthcare costs.
Senate proposal would
Officials of the UnitedHealth Group, touted as the nation's largest single require drug pricing
provider of Medicare Advantage and Medicaid programs, say changes idenitifed transparency
in the report could “better coordinate care and provide holistic and proactive
CMS seeks to improve
support for seniors and Medicaid beneficiaries.”
access to preventive
The report has been provided to the bipartisan National Commission on Fiscal services
Responsibility and Reform, known as the Deficit Commission. The commission,
CMS final rule to cut
established in February, is tasked with building consensus and recommending
2011 Medicare pay for
to Congress a new fiscal path for the United States. The recommendations are
physicians
due in December.
Vendor Notebook: The
According to the Congressional Budget Office, meaningful deficit reduction will Cardinal Health
be difficult to achieve without modernizing Medicare and Medicaid, both key Foundation calls for grant
drivers of the rising U.S. budget deficit. entries

“Expanding the use of coordinated care and integrating benefits and funding Houston patient recruiter
streams is a win-win for Medicare and Medicaid beneficiaries and for federal pleads guilty in a $5.2M
and state budgets,” said Simon Stevens, executive vice president of the Medicare fraud scheme
UnitedHealth Group and chairman of the UnitedHealth Center for Health
Reform & Modernization. “These are practical options that can now be tested at Medicare: An Entitlement
scale under current law.” Out of Control

Miami corporations,
Fee-for-service payments are given to healthcare providers for each service,
executives charged with
such as a physician’s office visit, test or procedure, regardless of health
$200M Medicare fraud
outcomes. Detractors say such care is often fragmented, with minimal
communication and coordination among different healthcare professionals. Group Health
Cooperative selects
The UnitedHealth Group report analyzes three approaches:
ikaEnterprise to facilitate
1. Provide coordinated care for Medicaid-eligible Americans to improve information flow across
access to care and health outcomes. Over 25 years, savings are payer business lines
estimated at $580 billion, of which $350 billion are federal savings.
During the initial 10 years – given transitional costs and phasing –
potential savings are estimated at $103 billion, of which $63 billion are
federal savings. Under this option, states would enroll most of their fee-for-
service Medicaid population (who aren’t also receiving Medicare), including
people with long-term care needs, in coordinated care programs.
2. Expand use of coordinated care for dual-eligible Medicare and Medicaid
beneficiaries to support people with chronic conditions requiring intensive
support and high-cost services. Over 25 years, savings are estimated at
$1.62 trillion, including $1.27 trillion for the federal government. In the first
10 years, savings are estimated to be $250 billion, of which $206 billion
are federal savings.
3. Provide seniors in traditional Medicare with value-added, comprehensive
care management services through the type of programs and approaches
used by America’s largest and most innovative ‘self-insured’ employers.
Over 25 years these savings – all accruing to the federal government –
could be worth $1.9 trillion, of which $317 billion are estimated to arise in
the first 10 years.

Related Topics: Medicare The UnitedHealth Group U.S. Washington

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