Saturday, July 01, 2000
Humana drops local seniors
Medicare HMO joins trend, cuts 11,000 area patients
By Tim Bonfield
The Cincinnati Enquirer
Another Medicare HMO has decided to pull out of Greater Cincinnati.
On Friday, Humana Gold Plus, the Medicare HMO run by ChoiceCare/Humana, became the third such plan to drop its local membership in less than a month.
The decision, which takes effect Jan. 1, will affect about 11,000 members in Hamilton, Clermont, Butler, Warren, Boone, Kenton and Campbell counties. The local departure is part of wider plans at Humana Inc. to drop 84,000 members in 45 counties nationwide.
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OPTIONS FOR SENIORS
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Rearranging health coverage after getting dropped from a Medicare HMO comes down to a few basic choices:
• Switch to another Medicare HMO. The law allows switches to occur with a month's notice. A senior cannot be rejected for pre-existing illness, but there's no guarantee that other HMOs will include your favorite doctors and hospitals. Costs and benefits (such as the amount of prescription drug coverage) can vary.
• Go back to regular Medicare. This is always an option for seniors and others who qualify for Medicare. But Medicare offers no prescription coverage and charges co-payments for hospital stays and other services.
• Go back to regular Medicare and buy a Medicare-supplement plan. This is what most seniors, except for the lowest-income seniors, did before Medicare HMOs came along. However, most Med-sup plans cost several hundred dollars and a few exceed $2,000 a year, with the highest fees charged for plans with drug benefits. Plus, Med-sup plans can increase rates with age or even decide not to sell to seniors with extensive medical problems.
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The news follows similar announcements Thursday by Aetna U.S. Healthcare and earlier this month by PacifiCare Health Systems and several Medicare HMOs in other states.
In all, Medicare HMOs nationwide have decided to drop about 711,000 elderly and disabled enrollees, one year after dropping about 700,000 members.
In Cincinnati, seniors who liked the drug coverage, low fees and and service from Medicare HMOs have swiftly been limited to one or two choices: Anthem Blue Cross and Blue Shield and United Healthcare. (The latter does not do business in Northern Kentucky.)
While both have announced they will stay in business next year, it remained unclear Friday whether they can absorb all 26,800 Tristate seniors who face losing their Medicare HMOs.
The pullouts raise serious questions for Congress, the Clinton administration and presidential candidates about a program called Medicare+Choice. Once hailed as the cornerstone of plans to stabilize rising costs, Medicare+Choice has fallen well short of its goal of giving seniors an entire menu of coverage options other than traditional Medicare.
“Our society needs to decide what we are going to do for our senior population. We better come up with something better than what we have now,” said Larry Savage, president of ChoiceCare/Humana in Cincinnati. “The bottom line is that there's not enough money in the system.”
The whole mess aggravates Keith Ray, 75, of Covington. He was getting coverage through Aetna and now he's waiting for a letter to explain his options.
“I've been very happy with the coverage,” Mr. Ray said. “I'm just sorry to hear they'd take a whole area like this and shut it down.”
In a statement Friday, U.S. Rep John Boehner, R-Ohio, blamed the Clinton administration for turning the Medicare+Choice program in to a “bureaucratic nightmare.”
“Medicare+Choice was designed to give seniors new choices and flexibility in meeting their health-care needs,” Mr. Boehner said. “Unfortunately, the Clinton Administration and its Health Care Financing Administration (the agency that runs Medicare) made the rules so onerous that many providers now find it impossible to even offer this option.”
However, Medicare HMOs don't see red tape as the main issue. They are pulling out over two money issues:
•A five-year, 2 percent cap on rate increases — passed by Congress and signed by President Clinton — as part of the Balanced Budget Act of 1997.
•A general unwillingness to change a county-by-county reimbursement formula that pays Medicare HMOs different fees in various parts of the country.
“The cap is 90 percent of it,” Mr. Savage said. “That and the regional disparity issue. Reimbursement by region can vary as much as 100 percent. The reimbursement varies by county even within this market and I'm pretty sure that doesn't make sense.”
While Mr. Boehner had no comment specifically on the 2 percent cap, he does support plans at the House Ways and Means Committee to consider changes to the Balanced Budget Act as soon as updated figures on the federal budget surplus come in, said spokesman Dave Schnittger.
In general, surviving Medicare HMOs have to accept seniors from other Medicare HMOs who want to switch plans. However, there is a procedure Medicare HMOs can follow to freeze their membership in a crisis.
With more than 40 percent of all Medicare HMO enrollees in Greater Cincinnati looking at switching plans, it might not be possible for the limited hospital and doctor networks of the two remaining plans to take on every patient, Mr. Savage said.
Spokesmen from United Healthcare could not be reached Friday. A press release on its Web site, however, states it will remain in Butler, Clermont, Hamilton and seven other Ohio counties.
Anthem expects to be able to handle large numbers of new enrollees, said spokeswoman Lauren Green-Caldwell.
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