CENTRAL COAST: To Get Medicare Reimbursement Boost
The federal government is increasing Medicare reimbursement rates for HMOs on the Central Coast, but many providers in the area say it may not be enough to convince squeezed plans to stick around. The Santa Barbara News-Press reports that Santa Barbara County's monthly reimbursement rose 12.2% from $406 to $456 and San Luis Obispo's grew 12.5% from $402 to $453. Rep. Lois Capps (D-Santa Barbara), who lobbied HCFA to recalculate next year's rates, said the government's decision was "a matter of justice." "I hope it's going to give seniors hope that the bottom is not falling out of something they counted on for their golden years. Now we have the assurance that what was really a disproportionate rate will now be corrected," she said. "The rate increase is good news," said James Ash, president and CEO of Santa Barbara Cottage Hospital, but added that "the county's reimbursement rate is still too low" compared with the national average of $500 a month. "We're not out of the woods with just the increase," said Jim Raggio, administrator at Lompoc District Hospital. "Just the increase will not allow us to really break even," he said, adding that HMOs should start charging premiums so they can pay hospitals more. In San Luis Obispo County, HealthNet, LifeGuard and Prudential withdrew from the Medicare market because of low reimbursements and in Santa Barbara County, HMOs "are watching to see what happens" to decide if they'll continue in the Medicare market next year, a decision they must make by July 1 (Wallace, 3/24).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.