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Health Insurance Reform Daily Mythbuster: So-Called Gag Order on Insurance Companies

Health insurance reform opponents - including House Republican Leader John Boehner - continue to spread myths about America's Affordable Health Choices Act, including the ridiculous myth that the Obama Administration has issued a gag order on insurance companies telling seniors how health insurance reform will affect them.  That is not true.  What the Administration did do is instruct health insurance companies to stop spreading misleading information about the possible impact of reform on seniors - conjecture not supported by independent news reporting on the part of these companies and, potentially, a violation of both federal regulations and the law.

MYTH: The Obama Administration has issued a gag order on insurance companies telling seniors how health insurance reform affects them.

FACT:  Yesterday, the Centers for Medicare and Medicaid Services (CMS) instructed health insurance companies offering Medicare Advantage plans and services to stop spreading misinformation - specifically in mailings and company Web sites - about the impact of health insurance reform to Medicare enrollees.

CMS issued the directive because of the likelihood that seniors and people with disabilities would believe this information to be “official communication about the Medicare Advantage program” rather than the opinion of the health insurance company.  Furthermore, CMS indicated this kind of communication may even be a violation of both federal regulations and federal law because these companies were misusing official Medicare enrollee data to lobby against the legislation.

Beyond the CMS directive, insurance companies earning taxpayer dollars were spending money to lobby against specific legislative initiatives--using claims about Medicare cuts which have been widely discredited by independent news media and fact checkers, for example:
MYTH: The House bill cuts Medicare to fund health insurance reform.

FACT: Nothing in this bill would reduce benefits to seniors. The cost savings measures in Medicare under America's Affordable Health Choices Act are all targeted at protecting and improving services and ensuring choice, by achieving new efficiencies; expanding authority to fight waste, fraud and abuse; and eliminating the wasteful Medicare Advantage subsidies to private insurance companies.

In fact, the $563 billion in savings over 10 years is a gross number--with a net of $340 billion in new spending to improve Medicare benefits and health care for seniors, including the following:

  • Lowers drug costs by gradually closing the “donut hole” for prescription drug reimbursement;
  • Preserves choice of doctors by eliminating a 20 percent cut in doctor reimbursements;
  • Lowers costs by eliminating copayments for preventive services;
  • Improves low-income subsidy programs, including under the part D program, to help ensure Medicare is affordable for those with low and modest incomes;
  • Computerizes medical records so seniors won't have to take the same test over and over or relay their entire medical history every time they see a new provider;
  • Expands the medical workforce so seniors will have more doctors to choose from and an easier time getting an appointment;
  • Develops new practices to improve quality such as the new Center for Quality Improvement that will identify best practices are distributed widely; and
  • Lengthens the solvency of Medicare by five years.