Health Plans
A more expensive HMO plan with full prescription drug coverage and other comprehensive benefits attracted Medicare beneficiaries in poor health, while healthier beneficiaries opted for the standard HMO plan with lower benefits and premiums, a study in the American Journal of Managed Care found.
The researchers found that a Medicare waiver helped the comprehensive HMO plan maintain a profit, despite its higher costs and overall poor health of its enrollees. Medicare payments through the waiver were about double the standard rates for members who met specific criteria.
The authors concluded that by attracting enrollees with poorer health seeking more services, the comprehensive HMO plan offered "the right care at the right time," providing a useful option for beneficiaries with more serious health problems (Leutz et al., American Journal of Managed Care, April 2007).