AAHP: Goes On Road To Protest Medicare HMO Payment Limits
The American Association of Health Plans (AAHP) yesterday "kicked off a 50-city tour" to protest federal limits on Medicare HMO payments, the Las Vegas Sun reports. "We want a level playing field," said AAHP President and CEO Karen Ignagni, "There is no cap on (regular) Medicare." Under traditional, fee- for-service Medicare, providers receive set reimbursement for each care episode, as well as some out-of-pocket payments from seniors themselves. In contrast, Medicare HMOs receive a lump-sum (capitated) payment for each enrolled patient and must manage care costs for each patient within that limit. Ignagni noted that while prescription drug costs are up 15% and health care inflation stands at 3% to 5%, Medicare HMOs can ask for "no more than a 2% increase per year for administrative cost in handling Medicare patients." She implied that insufficient reimbursement is driving Medicare HMOs nationwide to discontinue services and cut benefits. Ignagni characterized the tour as "the largest grass-roots effort the association has ever launched," noting that the AAHP "plans to lobby Congress heavily for support." In a written statement, Sen. Harry Reid (D-NV) said, "I am aware of the concerns, and I intend to closely monitor the situation." Rep. James Gibbons (R- NV) said, "HMO reform is an important change. I'm disappointed that the Senate didn't take up HMO reform like the House did" (Nadler, 12/3).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.