House panel hints at Medicare reforms

The chairman of a key House subcommittee suggested Wednesday that he would pursue legislation to reform the Medicare benefit with the help of a congressional advisory board.

Rep. Kevin Brady (R-Texas), who leads the Ways and Means Health subcommittee, said Medicare's benefit design needs an overhaul and that his panel is ready to look at the issue.

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"This committee has spent a ton of time on the rollout of the Affordable Care Act, and on coming up with a fairly historic agreement on how we permanently reimburse our doctors," Brady said at a committee hearing.

"Now we are turning to how we improve the Medicare progress. We will build on some of the recommendations [from MedPAC] and adjust them on a bipartisan basis."

Brady was referring to a set of reforms proposed last week by the Medicare Payment Advisory Commission, which advises Congress on Medicare policy.

Washington policymakers have long debated whether to unify Medicare benefits under a single deductible with a cap on seniors' out-of-pocket costs.

The proposal was raised in 2011 as part of talks to reduce the deficit, but liberal critics immediately challenged it, fearing the changes would raise costs for seniors who do not use hospital care.

MedPAC Executive Director Mark Miller testified Wednesday that, contrary to lawmakers' hopes for broad reform, Medicare is unlikely to discard its current payment model.

"We're going to be living with fee-for-service for some period of time, perhaps forever," Miller said. "I'm not sure that's a bad thing, because fee-for-service can be high-quality in some parts of the country."

He added that policies like a penalty on hospital readmissions has been effective, though not popular, in lowering Medicare spending.