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HMO costs for elderly keep rising
For
seniors, there are no longer easy choices when it comes to health care. HMOs
once offered a cost-effective way to boost the minimal benefits of
traditional Medicare. But they've become less and less of a good deal over
the past few years. As medical expenses have ballooned, so too have the
costs of these plans for the elderly. That
trend will continue in 2004. Hospital co-payments for the HMO plans --
known as Medicare+Choice -- will increase for many seniors. In addition,
now only one of four plans in Contra Costa and "It's
not as easy as it used to be," said Janet Van Deusen, program manager
for the Health Insurance Counseling and Advocacy Program in Alameda
County, which is funded by the state. "When seniors didn't have to
pay a premium, hospital and ambulance co-pays didn't exist -- 'it sounds
too good to be true' was the main response we got from people. And it
turns out that it was." Medicare+Choice
plans used to offer rich benefit packages for low premiums. Important to
many seniors, the plans had prescription drug benefits, something not
offered by traditional Medicare. Hospital stays were free and co-payments
for doctor visits were nominal, compared with the 20 percent co-insurance
charged by Medicare. But
starting in 1999, low federal reimbursement rates and sharply escalating
health care costs led health plans to withdraw from less profitable
geographic regions. The HMOs that remained raised premiums and
co-payments, introduced hospital deductibles and reduced drug benefits. For
2004, there will be no radical changes to the Medicare+Choice plans. The
basic rate for Medicare, paid by all enrollees, will increase to $66 from
$58.70. HMO premiums will stay about the same and co-payments for doctor
visits will not go up. However,
several changes detailed this week on Medicare's Web site, www.medicare.gov,
may greatly impact some seniors. Kaiser
Permanente's Senior Advantage and Health Net of California's Seniority
Plus will alter hospital co-payments, switching from an admission fee to a
daily charge. The change could quickly amount to higher out-of-pocket
costs for the sickest patients, Van Deusen said. In 2004, Kaiser
patients will pay $200 for each day in the hospital up to a maximum of
$3,000 for total medical expenses. This compares with $500 per hospital
admission and a maximum of $2,500 for out-of-pocket costs in 2003. It's
also potentially more than traditional Medicare, which costs $876 per
60-day hospital stay. Health Net members
will pay $175 for up to eight consecutive days in the hospital and will
have to pay again if 60 days pass between hospital visits. In 2003, Health
Net members paid $700 per hospital admission, paying again once 60 days
had passed. In addition, co-payments for outpatient surgery will increase
from $100 to $175 in 2004. Kaiser's
prescription drug coverage will also change. The HMO will drop all
payments for brand name drugs. In 2003, Kaiser paid $1,000 per year for
brand name and generic prescriptions, offering some relief for brand-name
drugs that can cost hundreds of dollars each month. In 2004, Kaiser will
pay only for generics, but it eliminated the $1,000 cap. That leaves only
Contra Costa Health Plan with a brand name drug benefit. As in 2003, the
plan will pay $1,000 toward generic and brand name prescriptions. Medicare+Choice
benefits are decreasing because federal reimbursement rates simply aren't
keeping up with medical inflation, said Denise Hanson, director of
Medicare and state programs for Kaiser Permanente The accumulated
changes leave Medicare+Choice plans only marginally better than those of
traditional Medicare. Premiums are still
cheaper than Medigap plans, insurance that supplements Medicare. But for
some seniors, paying Medigap's expensive premiums can prove cheaper in the
long run because it covers more. Van Deusen gave an
example of one client who might benefit from a Medigap plan. His HMO
covered only 80 percent of an expensive injectable drug received on a
weekly basis. His out-of-pocket bills added up to about $2,000 a month. Medigap H, on the
other hand, costs $140 to $660, depending on a person's age and where they
live. But Medigap would cover the entire cost of his injectable drug, and
there's no co-payment for doctor's visits and hospital admissions. One serious flaw
is that Medigap insurers can refuse to cover anyone with a pre-existing
condition. "There just aren't any easy answers any more," Van
Deusen said. Copyright
© 2002 Global Action on Aging |
