MEDICARE HMOs: Florida Looks Into Withdrawals
Florida Attorney General Bob Butterworth (D) and Insurance Commissioner Bill Nelson (D) yesterday announced that their offices are investigating whether seven major Florida HMOs unfairly dropped more than 52,000 of their Medicare customers. The two officials noted that Medicare HMO coverage for these customers is slated to end Dec. 31, leaving the seniors with the option of switching HMOs or having to join the "traditional and more costly" fee-for-service Medicare program. In at least 17 Florida counties, senior citizens will have no other choice but to join traditional Medicare (Nelson release, 10/13). The Tampa Tribune reports that Nelson and Butterworth "said they have subpoenaed financial, marketing and other records from seven [HMOs] that have announced plans to drop Medicare patients." The HMOs under investigation -- Prudential Health Care Plan, United Healthcare of Florida, CIGNA Healthcare of Florida, Aetna U.S. Healthcare, Humana Health Plan, Av-Med and Principal Health Care of Florida -- announced earlier this month they were dropping some or all of their Medicare HMO coverage as a result of low reimbursements from the government (Talev, 10/14).
The Miami Herald reports that the seven HMOs have until Nov. 12 to turn over records "showing how they solicited Medicare HMO subscribers, what promises they made, how their sales staffs were trained and what was involved in their decisions to enter various Florida markets and subsequently to abandon those areas." Butterworth said, "We want to know whether these companies have conspired to dump Medicare patients from their rolls. Such a conspiracy would be a clear violation of Florida's anti-trust laws and an unfair trade practice." The HMOs will also be asked to turn over information regarding federal reimbursement rates. Nelson acknowledged that part of the problem is the low reimbursement rates Congress set under last year's balanced budget agreement. "While Congress dithers on other matters, the effects of the Budget Balancing Act of 1997 are kicking in and everybody is pointing fingers at everybody else, senior citizens are the ones that apparently are going to suffer," Nelson said (Cummings, 10/14). The Orlando Sentinel reports that the officials "said they hope their investigation will push Congress to address" the low reimbursement rates "before lawmakers adjourn" this week. "When the heat starts getting generated ... (Congress) will hear the message. The problem is, they need to hear this in the next couple of days," Nelson said (Kennedy, 10/14).
The American Association of Health Plans "accused Butterworth and Nelson of playing political games," the Tribune reports (10/14). Noting that both men face Republican challengers in the upcoming November election, AAHP President Karen Ignagni said Butterworth and Nelson "are looking to score political points at beneficiaries' expense" (AAHP release, 10/13). Av-Med spokesperson Valerie Rubin made a similar comment, saying, "This is just so disappointing. It's as though the political posturing will never end" (Bryant-Friedland, Florida Times-Union, 10/14). But Fred Dunlap, president of United HealthCare, said, "From what I can tell, the department is trying to understand this issue. We will certainly cooperate. We're all trying to maintain quality service ... to aid seniors" (Sentinel, 10/14).
ABC's "World News Tonight" aired a segment profiling an elderly couple's dismay at finding their health plan was withdrawing its Medicare HMO option. ABC's John Cochran: "The Heidlingers have survived cancer and Nazi Germany, but they say they don't know how they will survive without their HMO." Cochran further reported, "Privately, senior administration officials tell ABC News that, in the end, the only solution may be to raise premiums or spend some of the budget surplus on Medicare" (10/13).