Record HMO Withdrawals Burden Medicare Program
With thousands of Medicare patients likely to lose coverage for prescription drugs, the pressure on Congress to enact a Medicare drug benefit is sure to increase.
More than 711,000 elderly patients will have to look for new Medicare HMO coverage or return to fee-for-service following announcements last week by several large health plans that said they will depart the Medicare HMO program in 2001.
Health plans say their decision to halt or limit their participation in the Medicare+Choice program was prompted by inadequate payment by the federal government. They say their 2% annual pay increases, formulated as part of the Balanced Budget Act of 1997, don't match the costs of caring for an elderly population, whose medical care expenses run 3 to 4 times that amount.
Plans have also characterized the program's regulatory oversight as excessive and costly. And finally, plan executives say, the costs of providing prescription drug coverage, a benefit offered by many Medicare HMOs to boost seniors' enrollment, has hiked their costs by an additional 15% a year.
The rash of HMO withdrawals from the program is sure to increase the political pressure on Congress to enact a Medicare prescription drug benefit, an enormously popular issue among seniors in a presidential election year.
With thousands of Medicare patients likely to lose coverage for prescription drugs, the pressure on Congress to enact a Medicare drug benefit is sure to increase.
More than 711,000 elderly patients will have to look for new Medicare HMO coverage or return to fee-for-service following announcements last week by several large health plans that said they will depart the Medicare HMO program in 2001.
Health plans say their decision to halt or limit their participation in the Medicare+Choice program was prompted by inadequate payment by the federal government. They say their 2% annual pay increases, formulated as part of the Balanced Budget Act of 1997, don't match the costs of caring for an elderly population, whose medical care expenses run 3 to 4 times that amount.
Plans have also characterized the program's regulatory oversight as excessive and costly. And finally, plan executives say, the costs of providing prescription drug coverage, a benefit offered by many Medicare HMOs to boost seniors' enrollment, has hiked their costs by an additional 15% a year.
The rash of HMO withdrawals from the program is sure to increase the political pressure on Congress to enact a Medicare prescription drug benefit, an enormously popular issue among seniors in a presidential election year.
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