Last week, the federal government revealed several new ideas in its continuing effort to simplify and reform the country's healthcare system. The changes appeared in the annual Medicare Advantage "call letter" released by the Centers for Medicare and Medicaid Services, which sets out rules for private insurance companies that wish to bid for the right to offer Medicare Advantage (private comprehensive medical coverage) and Medicare Part D (prescription drug) plans. About 10 million people have Medicare Advantage plans and 17 million more purchase Part D plans.

The most significant change will limit the number of different plans that can be marketed by a private insurer, in order to make it less confusing for seniors to compare the costs and benefits of different plans. Another new rule will prevent insurers from passing on the cost of brand-name prescription drugs to patients in situations where higher copayments are also being charged. A third initiative will prevent plans from charging copayments to patients with chronic illnesses, such as nursing home and dialysis patients, that are much higher than copayments charged by the traditional government Medicare program.

Medicare Advantage subscribers have the opportunity to enroll or change plans every year during an open enrollment period. The "call letter" requires insurers that wish to offer plans to submit their bids by June 1.