The Affordable Care Act Is Creating a Healthcare Crisis in Puerto Rico

Medicare Advantage is the backbone of the Puerto Rican healthcare system. Out of approximately 740,000 Medicare beneficiaries on the island, about 75 percent have chosen to enroll in a Medicare Advantage (MA) plan. That’s more than double the 30 percent average in the U.S. You would think that nearly 560,000 seniors, many of whom could not afford Medicare without MA, would be hard to miss. Yet when the Centers for Medicare and Medicaid Services (CMS) released its 2016 Medicare Advantage Call Letter on April 6th, they seemed toforgot these beneficiaries even exist.

CMS ignored the high rate of poverty and poor health in Puerto Rico. They ignored the fact that the island has the highest dual-eligible penetration in the country. They ignored the 18,000 letters from a coalition of Puerto Ricans seeking relief from looming cuts to the program. And they refused to recognize that Medicare Advantage rates in Puerto Rico are already 32 percent lower than the national average.

To be fair, Puerto Rico was not entirely forgotten in the 2016 CMS Call Letter was released. In fact, it was mentioned 27 times. Unfortunately, each time Puerto Rico was mentioned, CMS proffered only more excuses for ignoring the 560,000 MA beneficiaries on the island, stating that they did not have the necessary authority, time or desire to address the urgent needs of these beneficiaries.

Not everyone had such bad luck. Some health plans and beneficiaries applauded the fact that CMS adjusted the 2016 final rates to provide health plans across the country an average 3.5 percent rate increase. Media outlets trumpeted the positive news. But these same media outlets and CMS documents failed to note that Puerto Rico’s beneficiaries will face an 11 percent cut in 2016. Remarkably, the fact that Puerto Rico would lose over $300 million in Medicare Advantage funding in 2016 wasn’t mentioned.

Compared to 2011, when the Affordable Care Act (ACA) was implemented, Medicare Advantage funding in Puerto Rico has been reduced by an annual amount of over $1 billion. At this point, the island receives approximately 30 percent less funding than it did in 2011. The latest 2016 cuts will take funding on the island to a shocking 38 percent below the national average, with another year of cuts written into law for next year. The Puerto Rico Medicare Coalition for Fairness, local government officials, health plans, physicians, pharmacies, hospitals, patients, and others have worked tirelessly to reverse this dangerous trend — so far to no avail.

We have tried to shield the island’s poorest individuals from devastating benefits cuts and cost increases. We have spent hundreds of hours compiling data and policy solutions that would provide relief to these vulnerable beneficiaries. These policy solutions take into account Puerto Rico’s unique population and health system. They also take into account exceptions in federal law that have systemically put the U.S. citizens of Puerto Rico at a disadvantage with respect to Medicare funding, and that are leaving Puerto Rican seniors far behind where they were before the ACA.

Without immediate relief, 2016 will be a catastrophic year for Medicare Advantage beneficiaries and the entire healthcare system in Puerto Rico. Puerto Rican health plans are already losing money, and payments to physicians and hospitals will need to be slashed to match the 2016 revenue deductions.

But even with those changes, there is no way to continue to protect beneficiaries from these year-over-year cuts. Many people will be forced to choose between putting food on the table and getting routine medical care. CMS has regularly talked about the importance of achieving the famous “Triple Aim” of lower cost, better access, and higher quality – but  all of those have been severely compromised for Puerto Rico’s seniors.

With over 75 percent of eligible seniors in Puerto Rico enrolled in Medicare Advantage, Medicare Advantage is healthcare in Puerto Rico. The 560,000 beneficiaries on the island, the local government, health plans and providers are united in their demand that CMS and the Obama administration protect Medicare Advantage by adopting policy solutions that take Puerto Rico’s unique situation into account. We will continue to work day and night with the Puerto Rican government and others to offer these solutions and to remind CMS and the Obama administration that these Medicare Advantage beneficiaries can no longer be ignored or forgotten.


James P. O’Drobinak is the CEO of Medical Card System Inc. and president of the Puerto Rico Medicare Coalition for Fairness.


Morning Consult