Puerto Rico could lose billions in Medicare, Medicaid payments

Puerto Rico, which already is in the midst of a financial crisis, is facing steep cuts in Medicare Advantage rates and a likely lapse in funds supplementing its Medicaid programs, according to the Washington Post.

The U.S. territory makes due on Medicare Advantage payments that are smaller than most states receive. Sixty percent of the island's inhabitants rely on Medicare or Medicaid to pay for their medical care, the Washington Post noted. The payments are so low that about 400 physicians of the 11,000 who practice in Puerto Rico leave every year. However, the territory is exempt from certain mandates of the Affordable Care Act, such as community rating and medical loss ratios.

But according to a letter New York City Council Speaker Melissa Mark-Viverito sent to President Barack Obama last week, Puerto Rico is facing an 11 percent cut in Medicare Advantage payments for 2016, compared to the 3 percent increase slated for the U.S. states, the New York Daily News reported. It also could face the lapse of a supplemental payment for its Medicaid program.

The cuts in Medicare Advantage payments will cost Puerto Rico $500 million a year, according to the Washington Post. If the Medicaid supplemental payment lapses, it could cost the island another $1.8 billion a year. Its healthcare system, which represents about 20 percent of the territorial economy, has already been under financial pressure, with its Medicaid payer cutting back on prescriptions to its enrollees earlier this year.

Meanwhile, Puerto Rico is facing $72 billion in debt that its leaders say cannot be repaid. They are mulling bankruptcy or other alternatives, PBS News Hour reported.

"What makes this announcement particularly appalling is that federal healthcare funding rates for Puerto Rico are lower than of the mainland states, even though Puerto Ricans who live on the Island pay the same Social Security and Medicare taxes as other Americans," Mark-Viverito wrote.

To learn more:
- read the Washington Post article
- check out the New York Daily News article
- here's the PBS News Hour article

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