CMS actuary voices concern over healthcare reform measures

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Make therapy caps lower, streamline review process, MedPAC chairman urges House committee
Make therapy caps lower, streamline review process, MedPAC chairman urges House committee

In a Society of Actuaries speech on Monday, the Centers for Medicare & Medicaid Services' chief actuary accused legislators and policymakers of ignoring his warnings about the sustainability of the CLASS Act and changes to Medicaid under the Affordable Care Act.
Richard S. Foster recounted instances in which his office supplied lawmakers with analysis and data that were critical of certain healthcare reform proposals, only to see the information disregarded, according to the Bureau of National Affairs. Chief among Foster's complaints was the treatment of the Community Living Assistance Services and Support program, or CLASS Act.

CLASS is a program created under the reform law that offers long-term and disability insurance for seniors and disabled individuals. The program was intended to be self-supporting via premium payments, but Foster initially described the program as “unworkable” because of the high risk of adverse selection. He warned policymakers that individuals with the highest risks are most likely to enter the program, according to BNA. “Ignoring 200 years of actuarial principles has consequences,” Foster told the audience.
Foster added that Congress had asked him about changes in out-of-pocket medical costs in Medicare under the ACA. Foster claims Congress keyed in only on his data about fee-for-service costs going down and ignored his warning about potential spikes in Medicare Advantage costs, the report said. Another concern: a change to the definition of income that will occur when Medicaid is expanded to 138% of the federal poverty level in 2014.  This will mean that retirees getting Social Security could be enrolled in Medicaid if their income is at 400% of the federal poverty level or lower, he said. Foster also said disabled individuals and retirees covered by the Medicaid expansion will start cost-sharing when they reach Medicare eligibility at age 65. This could pressure policy makers to provide relief, he said.