Hello All;
I find this article by the Sacrament, CA., news paper, SacBee, very
interesting. Paticularly the part how much Medicare pays to the HMOs
for the care of each person. It is a staggering amount, and the HMOs
say they do not make any money. they are reducing the benefits,
increasing the co-pays to double the amount, and want us to pay to them
and extra $50.00 a month on top of the amounts Medicare pays them,
ranging from $478.00 to $600.00 per month per person.
Some thing must give and be reformed with this. This is happening all
over the US, and must be stopped, and a much better plan be
implemented for all.
Sorry if you are not concerned with this, then please just DELETE it.
Always, Imo scroll down to see the SacBee news article.
NO INFRINGEMENTS INTENDED ON THIS COPYRIGHT.
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Medicare -- plus fear
By Jean P. Fisher
Bee Staff Writer
(Published Sept. 17, 2000)
Spry at 76, Marian Hoye of Sacramento, doesn't spend a lot of time
thinking about health care.
"I've always been healthy," said Hoye, who enjoys volunteer work and
traveling.
While many of her peers need Ziploc freezer bags full of pills to keep
them going, Hoye takes only two medications: one to ward off
osteoporosis and another to keep hypertension at bay. She typically
visits the doctor about once a year -- for an annual checkup.
But as the years tick by, Hoye knows a time may come when her body will
fail her. If and when that happens, she wants to be sure she has health
insurance that will cover her costs.
Hoye planned for such a time last summer when she enrolled in a Medicare
HMO plan offered by Blue Cross of California.
The plan, with its rich benefits and $10 monthly co-payments, seemed a
better value than the traditional Medicare and more than $100-a-month
supplemental insurance plan she had been using. And the coverage would
be there should illness or accident strike down the road.
Or so Hoye thought.
In July Blue Cross informed Hoye, and more than 3,000 area residents,
that the company will stop offering Medicare HMO benefits after Dec. 31.
Blue Cross, citing rising medical costs and insufficient payment from
the federal government, was one of three insurers to pull the plug on
its Medicare HMO products in Sacramento this year. In all, about 5,000
Sacramento-area Medicare beneficiaries will lose their plan.
The trend is national, with health plans bailing out of the Medicare HMO
market en masse. Nearly 1 million Medicare HMO members nationally will
lose their plan by the end of the calendar year. Medicare, the federal
health insurance program for the elderly and disabled, covers about 39
million people, about 6.2 million of whom are now enrolled in Medicare
HMOs.
Health plans say the problem lies with the federal government, which
plans say won't pay them enough to cover costs, let alone make a profit.
The industry is pushing for a $15 billion cash infusion to boost
reimbursement and encourage fleeing plans to stay part of the Medicare
managed care program, known as Medicare Plus-Choice.
Uncle Sam argues that Medicare pays plenty for the plans to offer the
basic benefits available to all beneficiaries -- if not enough to
provide extras such as prescription drug coverage and profit for the
plan.
Congress is deciding which side to believe while weighing how it might
intervene.
In the meantime, the shifting ground has left scores of Medicare
beneficiaries such as Hoye feeling shaken and unsure.
"I haven't a clue what to do," Hoye said.
She's not sure if she should go back to traditional Medicare, which
requires beneficiaries to pay 20 percent of most medical bills or turn
to one of the remaining Medicare HMOs serving Sacramento and hope that
it stays in the area.
"It comes down to money," Hoye said. "I'm very healthy now and have
not
had anything wrong with me, but I don't know what the future holds. I
think I'll stay healthy, but I can't say that so certainly that I don't
need to worry about my coverage and ability to pay."
No one would envy Hoye's problem. But while the news about Medicare HMOs
sounds bad, many say what is occurring is the normal and expected result
of health plans competing in the marketplace.
"What we're seeing is the shaking out of the less competitive plans,"
said Marilyn Moon, who closely follows the Medicare program as a senior
fellow with the Washington, DC-based Urban Institute.
The shakeout will continue but as the remaining health plans consolidate
the Medicare business, the market actually is becoming more, not less,
stable, experts say.
In California, for example, two plans control more than 70 percent of
the Medicare HMO market. Those plans -- Kaiser Permanente and
PacifiCare -- did not exit from a single county.
So while there are fewer choices overall, chances are good that the
remaining players will stand firm, said Jack Christy, director of the
California Healthcare Foundation's Medicare Project.
About 57,000 California Medicare HMO members -- about 3.7 percent of all
Medicare beneficiaries in the state -- will lose their plan because of
insurer departures in their areas, he said. But 96 percent of those
people will have at least two other managed care options available to
them in 2001.
"The bottom line is that Medicare HMOs are still strong in California,"
Christy said. "There are still many choices in many counties."
In deciding to leave a county, insurers typically point to the Medicare
reimbursement rate for that county. The Medicare program uses a
complicated formula to determine a monthly per-person payment for each
county. The program generally pays plans more in urban counties and less
in counties with lower population.
In Sacramento County, for example, plans get about $545 a person each
month. Just across the river in Yolo County, plans get about $498 a
person.
Plans once were paid a flat rate for each member, but that changed with
the Balanced Budget Act of 1997. A new payment system paid more for
sicker members and less for healthier ones, a move that meant less money
for the plans overall.
The 1997 act, tightly focused on reining in costs and extending the
financial viability of the Medicare program, also set annual
reimbursement increases at 2 percent.
But with medical inflation growing at a rate of about 7 percent a year,
the new, legally enforced economics just don't work, said Karen Ignagni,
president of the American Association of Health Plans, a national
industry group.
In response, health plans have systematically exited low-paying counties
and areas where they do not have enough business to justify continuing,
she said.
Even the most stable Medicare HMO players are just covering costs or
making wafer-thin profits. Those plans may conclude they should get out
too, if the government continues to "starve" Medicare Plus-Choice,
Ignagni said.
"We used to call for midcourse corrections, but it's too late for that,"
she said. "We're really talking about a rescue mission now."
The industry's cries may resonate with beneficiaries who stand to lose
their coverage, but in Washington and among health policy experts, they
go mostly unheard.
According to the Health Care Financing Administration, the federal
agency that administers Medicare, Medicare HMOs doing business in 2000
were able to provide the basic benefit package to their members and
still spend 22 percent of their Medicare revenues on additional benefits
not available to non-HMO beneficiaries.
Such numbers belie industry claims that plans cannot cover costs, a HCFA
fact sheet states.
Ignagni counters that such arguments seem to want to punish managed care
for being efficient.
But others, like Urban's Moon, say it comes down to an issue of basic
fairness. Why should the government boost payments to HMOs, which offer
enhanced benefits to a few Medicare beneficiaries, when the vast
majority of Medicare members must make do with lesser coverage.
If Medicare HMO members want to supplement coverage for basic
hospitalization and outpatient services -- which is what traditional
Medicare covers -- with prescription drug coverage, vision and dental
and other benefits, it shouldn't be much to ask them to be willing to
pay something extra for it, Moon said.
In fact, that's exactly what plans have had to ask their Medicare HMO
members to do.
Kaiser Permanente's Senior Advantage Medicare HMO will begin charging a
monthly premium in every county it does business in -- for Sacramento,
$40 a month -- beginning January 1. Members currently don't pay a
premium.
Last year, the plan increased its prescription drug and office visit
copayments and dropped its dental coverage.
"This was the best way for us to continue to offer a competitive,
comprehensive plan," said Denise Hansen, who oversees Senior Advantage
in Northern California.
Kaiser, with about one-third of the state market and Sacramento County's
dominant Medicare HMO, plans to stick with Medicare. The plan can afford
to make that call because of its size -- about 600,000 Senior Advantage
members statewide.
"That's a pretty big pool to spread the risk over," Hansen said.
"Because of that, we're going to be able to be here for our members."
Even so, Kaiser is just covering its costs, she said.
PacifiCare's Senior Advantage, the second largest plan locally and the
state's largest Medicare HMO, will begin charging Sacramento members $50
a month, up from $40. In nearby El Dorado County, the premium will more
than double from $40 to $100 a month.
For its part, Secure Horizons is dropping benefits such as chiropractic
care and podiatry from its standard benefit, but making the coverage
available to members for an additional charge.
"In order to make it work over the long haul, we are asking members to
pay more out-of-pocket," said Kathy Feeny, who oversees Secure Horizons.
"And we are looking to make it over the long haul. We are not dabbling
in this business. You can't."
Foundation/Health Net Seniority Plus, the third largest Medicare HMO in
Sacramento and in the state, could not provide benefit changes for the
coming year last week but will notify members in writing by the required
Oct. 15 deadline.
Even as most plans edge premiums up and slash benefits, Medicare HMOs
often remain a better deal than traditional Medicare, particularly for
people with significant medical needs.
Michael Fleming, 53, who is eligible for Medicare because he is disabled
with severe, chronic, obstructive pulmonary disease, said he couldn't
manage without membership in Secure Horizons.
Fleming said treatment for his condition has resulted in medical bills
of more than $500,000 over the last four years. Fleming's share would
have been more than $100,000 if he had stayed in traditional Medicare.
And that doesn't factor in the cost of prescription drugs, which Fleming
said would run about $1,200 a year.
"It's really saved my family from tremendous financial strain," said
Fleming of his Medicare HMO plan. He has had half a lung removed, two
30-day stints in a nursing home and is more or less permanently tethered
to a portable oxygen tank. "If I had to rely on basic Medicare, I'd be
bankrupt. I just couldn't afford to pay for all the care I need."
Fleming has watched apprehensively as Secure Horizons began charging a
premium, cut back his drug benefits and edged up his copayments.
Judy Feder, a Georgetown University health economist who is skeptical of
Medicare HMOs, said HMO members have a legitimate beef with plans that
now are scaling back menus of once-impressive benefits.
"Medicare beneficiaries were sort of lured into these plans by the zero
premiums and all the extras and no one said to them there's no guarantee
these benefits are going to be here, they can be taken away," Feder
said.
Rather than heed Medicare HMO members' cries of pain, though, the "most
important use of federal dollars is to enhance the benefit package all
beneficiaries receive," Feder said.
"The goal of the Medicare program is not to promote managed care," she
said. "It's to provide quality care and efficient delivery of care."
But Feder points out that enhancing the benefit package for traditional
Medicare would translate to greater payments to HMOs, because the
monthly payment health plans receive is tied to the average cost of
benefits provided through basic Medicare.
Presidential candidates Gore and Bush have both proposed plans to add
optional prescription drug benefits that would be available to all
Medicare beneficiaries, although through vastly different approaches.
In the meantime, Medicare beneficiaries such as Marian Hoye wait and
wonder what to do.
"I felt a little bit left out in the cold," Hoye said of getting
dropped, pausing to talk en route to Sacramento's Railroad Museum, where
she volunteers as a docent. "You really feel at the world's mercy."
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Imo Lee Card Greenwood
searching surnames: Acuff, Barlow, Byrd/Bird, Card, Greer, Lamb,
Odom, Thomas, Shewmake/Shoemate
My husband : Greenwood, Culp, Kitzmiller, Nevill/Neaville