GOP Lawmakers to Propose Legislation to Stem ‘Defections’ from Medicare+Choice

Hoping to prevent more "defections" from Medicare+Choice, Reps. Bill Thomas (R-Calif.) and Nancy Johnson (R-Conn.) plan to introduce legislation to boost reimbursement rates for health plans participating in the program and force Medicare beneficiaries to "make cost-conscious medical choices," USA Today reports. The proposal, outlined in a letter sent Aug. 30 to Centers for Medicare and Medicaid Services Administrator Thomas Scully, would increase reimbursements for health plans, including a "special subsidy" to provide prescription drug coverage. Under the proposal, beneficiaries could select a lower-cost plan and receive rebates or select a higher-cost plan, which would require them to pay additional fees. USA Today reports that the proposal will likely "draw fire" from HMO critics, who maintain that Medicare overpays insurers (Appleby, USA Today, 9/4). The Bush administration announced on Aug. 29 that HMOs participating in Medicare+Choice will drop health coverage for "several hundred thousand" Medicare beneficiaries next year. To help prevent "greater losses," Scully said that the administration plans to ease rules for health plans participating in the program. However, only Congress can boost reimbursement rates for HMOs participating in Medicare+Choice. In 2001, more than 900,000 Medicare beneficiaries had to enroll in new health plans or return to traditional fee-for-service Medicare after many HMOs withdrew from Medicare+Choice. Scully said that HMOs, which cover 15% of Medicare beneficiaries, have until Sept. 17 to announce whether they will cover beneficiaries in certain markets next year (Rosenblatt, Los Angeles Times, 8/30).