MEDICARE HMOS: GAO Says ‘Drug-Switching’ Frequent
A GAO study released yesterday indicates that Medicare HMOs in certain states may be luring seniors into their plans by promising to cover particular prescriptions, then dropping them without notice, the New Orleans Times-Picayune reports. The study, which surveyed 16 HMOs in California, Florida and Pennsylvania, revealed that 12 plans stopped covering some drugs to treat ailments common in the elderly, such as hypertension, depression, ulcers and high cholesterol. As a result, many seniors are forced to "switch to alternative formulary drugs or increase their out-of-pocket expenses, in some cases to the full price of the drugs." The GAO report found that "plans vary widely in the drugs they cover, the co-payments they require and the annual limits on coverage. ... Beneficiaries ... may not learn about formulary changes until (they) are at the pharmacy counter." Although some plans notified members of the changes, others failed to do so. With annual drug costs soaring "at a double- digit clip," it is common for Medicare HMOs to "tinker with the list of drugs they will cover" (Walsh, 7/20). Sen. Chuck Grassley (R-Iowa), chair of the Senate Special Committee on Aging, yesterday reacted strongly to the report's contents during a hearing on the report's findings. "Many older Americans choose managed care specifically for prescription drug coverage. ... They want coverage of prescription drugs that work for them," Grassley said, adding, "It's important that seniors know of this [drug switching] possibility before they sign up for managed care. No one should be in for an unpleasant surprise at the drugstore." Grassley vowed to work to "ensure full disclosure of changes in drug coverage by Medicare managed care plans." Both he and ranking committee member Sen. John Breaux (D-LA) said they would request that HCFA develop a plan of action to address the disclosure problems (release, 7/20).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.