In fact, the Baucus draft legislation slashes $123 billion over the next decade from Medicare Advantage, which Democrats hate despite the fact that almost one-fourth of beneficiaries have chosen it over traditional fee-for-service Medicare. One reason seniors like it is because private insurers focus on quality and preventive care and try to manage benefits, as opposed to simply paying bills.
A new study from America's Health Insurance Plans, the industry trade group, finds that seniors on Advantage in California spent 30% fewer days in hospitals over fee-for-service patients, based on federal data. Democrats say that insurers are "overpaid," but the cuts—as Humana correctly noted—mean that seniors may lose this coverage.
Mr. Baucus doesn't want seniors to be educated about these facts, and obviously he's willing to use his enormous power to punish any private company that doesn't affirm his, well, creative version of reality. Nearly half of Humana's yearly revenue comes from Medicare Advantage, and the insurer says that it is complying in full with the CMS investigation. Yesterday, the agency also barred all Advantage insurers from providing similar information to their beneficiaries.
This episode neatly shows how all U.S. health care will operate if Mr. Baucus's bill becomes law. For months Humana and the wider insurance lobby have been among ObamaCare's most prominent cheerleaders, with the exception of Advantage cuts and the public option—even though they'll be converted into government contractors in the business of fulfilling whatever Congress happens to dictate. The insurers are willing to give up their remaining business autonomy because Democrats intend to mandate that all consumers buy their products—but as with Advantage now, that means government will control the funds upon which the insurers' survival depends. They'll have no choice but to genuflect, or else the political class will pull out the tire irons.