The front page of the March 2022 newsletter of the Puget Sound Advocates for Retirement Action features their letter to Senators Patty Murray and Maria Cantwell and Congresswoman DelBene urging an end to the Direct Contracting Entities (DCEs) program that is privatizing Medicare.

The DCEs have been renamed ACO REACH, but the threat to Medicare is the same. On page 2, PSARA describes the responses and plans for visits to the congressional delegation saying, “No one will privatize our Medicare without a fight.” PSARA also signed on to the national letter opposing DCE/REACH.

Unions, retiree organizations, and other groups can sign that letter here: https://protectmedicare.net/health-justice-allies/

Don’t Privatize Our Medicare!

PSARA’s Letter to Our Congressional Delegation For an End to Medicare Direct Contracting

Dear Representative/Senator,

Puget Sound Advocates for Retirement Action (PSARA) requests that you support traditional Medicare beneficiaries and communicate to the President and Secretary Becerra the absolute need to terminate the Medicare Direct Contracting (DC) pilot program. There is simply no question that this program is a significant step in the effort to privatize traditional Medicare.

We only became aware of the DC program fairly recently. This program, initiated by the Trump administration, contracts with a Direct Contracting Entity (DCE) to manage the care of individual Medicare beneficiaries. These DCE’s are privately owned companies paid monthly to cover and manage the health care of Medicare beneficiaries who have chosen traditional Medicare for their healthcare coverage.

Those of us who chose traditional Medicare made that choice because we have a direct relationship with a provider of our choosing. The DC program will undermine this critical feature of traditional Medicare. The DCEs funnel Medicare patients to providers within the DCE’s networks and the DCE is allowed to retain the remaining reimbursement received from CMS as profit for managing the patients once the provider is reimbursed.

The majority of DCEs now part of the pilot are investor owned and controlled. Owners of DCEs include private equity firms and large insurance companies. We are pleased that Secretary Becerra has placed a pause on the Geographic Direct Contracting Model and has stopped accepting applications for the Global and Professional Direct Contracting Model for 2022. However, this pilot program is a violation of the conscious choices made by traditional Medicare beneficiaries to not choose Medicare Advantage and instead be able to have a direct choice of their medical provider without an intervening third party.

Our request is clear. Please communicate the necessity to terminate the Medicare Direct Contracting pilot program. We ask that you respond to this letter and let us know what steps you intend to take.

---

For the (disappointing) response from our representatives, see Page 2 (below).

Don’t Privatize Our Medicare!

What Our Representatives Said…and Didn’t Say

We received responses to the letter on Page 1 (above) from our two Senators, Patty Murray and Maria Cantwell, and from Rep. DelBene (D-1). PSARA member Lisa Dekker also received a reply to a personal communication with her Congress member, Derek Kilmer (D-6), about Medicare Direct Contracting.

Sen. Murray’s office told us they appreciated our concerns and would refer our letter to their health care specialist. We have had no further comment from them or the specialist.

Sen. Cantwell wrote us a 400 word letter telling us how much she supports Medicare. But then there was this:

“Instead of cutting Medicare benefits, we should be working to improve Medicare for patients while driving down costs. Under the current system, doctors and medical facilities are generally paid by the number of services they provide, without regard to the best outcome for the patient. That is why I authored a ‘value index’ that puts the focus back on patient health, paying doctors more when they provide better care to their patients. It rewards quality over quantity. My value index is part of a new Medicare physician payment system that is beginning to move Medicare from a volume-based system to one that rewards high quality and high-value health care.”

Does this mean she is supporting Direct Contracting? We intend to find out and at the same time we will let her know privatizing traditional Medicare is unacceptable and betrays the choice that 58 percent of Medicare beneficiaries made.

Rep. DelBene’s legislative director replied to us that “Rep. DelBene doesn’t like the [private equity] involvement and has been supportive of the Medicare Accountable Care Organization program which in simplest terms has the good parts of the DCE model but doing it in traditional Medicare not [Medicare Advantage],” indicating a lack of understanding that Direct Contracting does apply to traditional Medicare.

He then linked us to Rep. DelBene’s website which expresses enthusiasm for so-called “Alternative Payment Models” and “Accountable Care Organizations” - these appear to be new, fancy terms for privatizing traditional Medicare and turning it into a profit center for corporate America.

Rep. Derek Kilmer wrote Executive Board members a letter in which he, too, assured us that he supports Medicare. He added that:

“The Center for Medicare and Medicaid Services has paused the Geographic Direct Contracting Model for further review and is no longer accepting applications for DCE. That said, like you, I understand the importance of ensuring that seniors have access to high quality, affordable health care. As the Direct Contracting pilot program is further considered by Congress, please know that I will keep your thoughts in mind.”

Of the members who replied to us, all said they support Medicare and wanted us to know they will do their best to assure us access to the medical care we need. None of them committed to oppose Direct Contracting and some voiced support for the kind of privatizing programs we oppose. Clearly, we have a battle ahead of us to make sure no one privatizes our Medicare.

Medicare works. We don’t need and we don’t want private contractors getting between patients and doctors. We don’t need and we don’t want our health care to be a source of profits for private investors. Traditional Medicare needs to be expanded to cover dental, vision, and hearing with limits on out-of-pocket costs.

As you read this, PSARA is setting up meetings with the members of our Congressional delegation to go deeper into this important subject. No one will privatize our Medicare without a fight.

https://www.psara.org/newsletter-archive (scroll down to the 2022 March issue)

---

Sign on to Stop DCE/REACH here: https://protectmedicare.net/health-justice-allies/

Further information on DCE/REACH is available at: https://protectmedicare.net/

---

2022-04-03