| ||||||
|
|
|
|
|
|
|
|
|
 |
 |
 |
 |
|
 |
By Milt Freudenheim, the New York Times No fewer than five H.M.O.
companies are scrambling to sign up elderly members in the county, and the
pitches being delivered over lunch tables here herald a national surge in
Medicare managed care prompted by the Bush administration's plan to pump
$46 billion into these programs over the next 10 years. In negotiations over the
Medicare drug law last year, Republicans argued for more money for managed
care plans, saying they would provide more choices for the elderly and
save money in the long run. Many Democrats and consumer advocacy groups
said Medicare managed care had yet to demonstrate savings over traditional
Medicare. But for elderly retirees
in places like Spring Hill, the public policy debate in Washington comes
down to hard realities: allotting dollars from their tight budgets, the
allure of those free lunches, the extra benefits that the new billions
will buy — and whether to believe that the health plans will not abandon
them again as they did a few years ago. Here in Hernando County,
Humana Inc., one of the first H.M.O.'s to return to a place it had left,
is encountering former members who are evidently slow to forgive. "We were pretty
angry," said Marie Nielsen, 68, a retired nurse originally from Clayton Thomas, an
85-year-old retired sales engineer who moved here from "Humana told us they
couldn't afford it," Mr. Thomas said. Now, though, "Medicare is
paying more to the H.M.O.'s," he added. "So they decided to come
back in and tackle us again." As the money starts
flowing under the new Medicare law, the government expects managed care
membership to triple, to 14.7 million people in the next three years, and
cover more than one in three elderly people. That would be a drastic
reversal. Complaining that they were losing money at the government's old
reimbursement rates, managed care companies shut 411 local plans over the
last few years, dropping more than 2.4 million Medicare enrollees. Across the country,
companies have filed applications with the government to set up new health
maintenance organizations or preferred provider networks in 18
communities, Medicare officials said. In "Even though there
may be some residual angst, I think there's going to be a lot more people
interested in participating," said Michael McCallister, chief
executive of Humana, which has 328,000 Medicare members in half a dozen
states, down from a peak of more than 500,000 in the mid-1990's. Dr. Scott Latimer, a
Humana regional vice president in Humana's return was timed
to coincide with a sharp rise, under the new Medicare law, in the
program's payments to H.M.O.'s. The increases were especially large here
and in many other parts of the country where reimbursement levels were
deemed inadequate to keep up with rising costs. In The Bush administration
says that the higher payments make up for skimping in the past. Leslie V.
Norwalk, acting deputy administrator of the federal Centers for Medicare
and Medicaid, said the goal was "to get plans back in the
program" and give beneficiaries more choices, including preferred
provider networks that are popular in employer health plans. For that, the program is
paying a high price. A new study by Mathematica Policy Research Inc. says
that the Medicare law gives health maintenance organizations 7 percent
more, on average, than the per capita spending for traditional Medicare. The government has
"pretty much given up on the argument that the H.M.O.'s save
money," said Lori Achman, a research analyst at Mathematica, an
independent research center. In "People will tend to
vote with their feet," he said. The departure a few years
ago of Humana, United Healthcare and AvMed Health Plans, a nonprofit
insurer based in Of the county's 146,000
residents, 30 percent are 65 or older, and in 1999, the peak year for
enrollment, more than 11,700 were members of Medicare H.M.O.'s. That
number had fallen to 7,990 before the start of the current recruiting
drive. Ms. Nielsen, the retired
nurse, said that the H.M.O.'s were popular with the elderly because they
offered more benefits than traditional Medicare at a lower out-of-pocket
cost. "No. 1, they can't afford the 20 percent share in traditional
Medicare, and, No. 2, they needed a prescription drug program," she
said of her peers. As Humana was leaving, a
group of local doctors persuaded WellCare, based in Unlike Medicare plans in
places where the competition is less aggressive, the H.M.O.'s here do not
charge monthly premiums. Going even further, Universal is now paying the
entire $66.60 monthly Medicare Part B premium, which the elderly normally
have deducted from their Social Security checks. Medicare plans across the
country are using about half the windfall from Congress to reduce premiums
or add benefits, and most of the rest to pay doctors and hospitals,
according to the Centers for Medicare and Medicaid. The insurers are
keeping 0.6 percent, or about $200 million this year. But Wall Street investors
are expecting a big payoff. With the passage of the Medicare law, Humana
shares soared to a 52-week high of $24.02 in January, up from $8.81 in
March 2003. Shares closed yesterday at $21.53, down 46 cents. "Wall Street is
focused on expected growth and the potential for profits this year and in
2005," said Charles A. Boorady, an analyst at Smith Barney. He
estimates after-tax profits in a range of 2 percent to 5 percent of
Medicare payments for publicly traded companies. But he cautioned that
after the November election, investors might start to focus on the
possibility for cuts in Medicare reimbursement, because of federal budget
concerns. Also, some elderly H.M.O.
members may switch back to traditional Medicare if the new prescription
drug benefit looks attractive, he said. But for now,
reimbursements and benefits are jumping. In the Howard Gold, a senior vice
president of North Shore Long Island Jewish Medical Center, said a number
of H.M.O.'s that had pulled out of the region had approached him to
discuss the financial terms they would face if they returned. Companies
that shut down Medicare H.M.O.'s in Managed care companies,
which lobbied hard for the higher payments, see an opportunity for profits
and to expand their physician networks before the boomer generation ages
into Medicare eligibility. In the meantime,
executives are confident that Congress will not pull the rug out again.
“Nobody can predict what is going to happen in Still, some Medicare
beneficiaries, feeling that they were lulled into complacency once, will
not let it happen again. Raymond Belanger, 70, a
retired electronic engineer who moved to Spring Hill from “It's a big conglomerate,” he said. “The dollar is the almighty thing. It's not the people.” Copyright © 2004
Global Action on Aging |
