“Medicare for All” for the MSP Mindset
As the new Congress settles in and the presidential campaigns heat up, there is renewed talk of “Medicare for All.” The possibility of universal health care insurance raises questions over how CMS/Medicare would manage workers’ compensation claims and the coordination of benefits when everyone is covered by a government-run, single-payer system. No doubt there will be many impacts on workers’ compensation and the larger insurance industry.
What is “Medicare for All?” A single, national health insurance program providing universal care is the basic concept, though most proposals provide for phased buy-in, beginning with people in their fifties. Other models include coverage for hospital and physician services while prescription medication and other costs would be borne by either private pay or private insurance. Single-payer coverage is likely to be more generous than the current Medicare program, eventually covering dental and vision benefits and possibly long-term care. CMS/Medicare would theoretically have bargaining power over reducing treatment costs. Ultimately, employer-based coverage, the Affordable Care Act, and public programs like Medicaid and traditional Medicare will disappear.
Coordination of Benefits Defined: Underlying Medicare Secondary Payer law is the policy that Medicare’s interests must be considered with the shifting of costs away from Medicare to primary private coverage. The clear example is workers’ compensation where Medicare does not cover medical expenses arising from work-related injuries. These expenses are properly paid under workers’ compensation. Notably, CMS continues gearing up to enforce the law against liability and no fault plans.
In order to prevent cost-shifting to Medicare, CMS has rules for the coordination of benefits which determines what coverage is primary and what is secondary. Thus, when an injured worker has both Medicare and other health insurance or coverage for a job-related injury, workers’ compensation is the primary payer while Medicare is secondary.
“Medicare for All” and the Coordination of Benefits and Claims Handling: For services provided by a “Medicare for All” program, employers and workers’ compensation carriers and programs would still bear the costs of work-related injuries and illnesses. A single-payer system would hold employers financially accountable for employee injuries. Private supplemental Medicare insurance plans would also continue to seek coverage and reimbursement for work-related care like prescription drugs.
As a practical matter and similar to the Affordable Care Act, an injured worker with universal health care coverage will be able to see their primary care provider and participate fully in treatment decisions. Workers’ compensation claims management would be minimized while administration largely reduced to financial accountability and reimbursement matters.
However, better access to healthcare should produce fewer and less questionable workers’ compensation claims. Wellness initiatives and chronic condition management by primary care providers will also contribute to reduction in costs and Medicare reimbursement rates would be lower than those under workers’ compensation.
Bigger Economic Consequences: Before any legislation is passed and the details worked out, there are many economic hurdles to clear. A special tax would have to be implemented to pay for universal health care insurance, though proponents insist that the overall total amount would be less than the current projections of ever-rising private health care costs. The impact of abolishing (or greatly restricting) the health care insurance industry – a large segment of the economy – would be significant. Yet, new and expanded markets will likely be created for supplemental and more inclusive private insurance products. Legislative proposals also seek to minimize the impact on investors and workers with job displacement services and benefits. Interestingly, insurers could be transformed into contractors necessary for administering a universal health care insurance program. We plan to stay tuned to the developing discourse and proposals and invite readers to do the same. A “healthy” discussion is always good!