Medicare's Complexities and Dual Personality

Part 3, Chapter 9: Medicare and Medicare Related Programs: Medicare Page 4

Continued from Previous Page

The complexity and the communications difficulties seem to result from a number of factors. To begin with, the Medicare system is inherently complicated in terms of its basic design. For example, instead of being developed as a single integrated program, Medicare is composed of two separate programs.

Medicare: Part A focuses on providing coverage for hospital-based (inpatient) treatment. Medicare: Part B focuses on providing coverage for outpatient treatment, including doctors' visits and medical tests. Each program follows different rules and has different deductibles and co-insurance amounts.

In addition, the Medicare claim-processing system is administered by a series of local plan administrators rather than by a singe national agency. In some cases, those administrators may have decision-making authority on certain issues. For example, although the federal Health Care Financing Administration (HCFA) -- the federal agency that regulates Medicare -- sets national policy in terms of coverage for many tests and procedures, in some cases decisions related to coverage for new tests for which HCFA has not yet issued policies may be left to local Medicare plan administrators. As a result, while reimbursement for certain medical tests may be available to Medicare beneficiaries in one part of the country, reimbursement for similar tests may not be available to beneficiaries in other parts of the country.

Continued on Next Page