MEDICARE+CHOICE II: United Pulls Out Of 86 Markets
United HealthCare Corp. announced yesterday that it will pull its Medicare HMO out of 86 of the 206 counties in which it currently operates. The withdrawal, which will be effective Jan. 1, will affect approximately 59,000, or 13%, of the company's 440,000 Medicare members. United said it "will remain in strong and economically viable markets where it can operate efficiently to serve the Medicare community," but added that "it is taking other specific actions" that will likely cause its Medicare enrollment to decline by another 20%. These actions include changing some benefits and reconfiguring some provider networks. Jeannine Rivet, CEO of United's Health Care Services segment, said, "All of the above changes are being implemented with the goal of better aligning benefits, medical costs and future trends with the level of reimbursement provided under the county-specific Medicare payment formulas now in place" (United release, 10/1). The Dallas Morning News reports that United's "action coincides with the government's decision Thursday to reject an insurance industry request to increase charges on seniors' benefits." Yesterday was the last day "before all health insurers must tell the federal government which counties they plan to leave at the end of this year" (see related story). Karen Ignagni, CEO of the American Association of Health Plans, said United's withdrawal "offers an ominous preview of what could become an exodus from Medicare by" HMOs. She said, "This is the tip of the iceberg. Unless the issues that (health) plans raise get addressed, we're looking at more problems. This is a wake-up call" (Ornstein, 10/2).
The Chicago Tribune reports that United will pull out of "five suburban Chicago counties": DuPage, Lake, Kane, McHenry and Will (Jaspen, 10/2). United's Florida arm will pull out of nine Central Florida counties -- Brevard, Hernando, Highlands, Manatee, Orange, Osceola, Polk, Seminole and Volusia -- where it had 4,500 policyholders, but will continue covering "almost 100,000 Medicare recipients in 12 counties" (Pack, Orlando Sentinel, 10/2). The Baltimore Sun reports that United is "pulling out of the Eastern Shore, Southern Maryland and Western Maryland, but [will] continue to operate in the Baltimore-Washington metropolitan area."
That's Not All
In addition, other Medicare HMOs used yesterday's cutoff date to announce similar service cuts. Mid Atlantic Medical Services Inc.'s Optimum Choice HMO pulled out of the Maryland Medicare market yesterday, citing similar concerns as United about the profitability of some regions (Salganik, 10/2). "The move by MAMSI, the region's largest health plan, forces 7,441 seniors" to find new coverage by the first of the year (Goldreich, Washington Times, 10/2). In Minneapolis-St. Paul, Blue Cross and Blue Shield of Minnesota will "discontinue its Preferred Seniors HMO throughout the metro area." Blue Cross joins Medica HMO, which announced Tuesday it will end its SeniorCare HMO in Carver, Dakota, Scott and Goodhue counties in Minnesota (Howatt, Minneapolis Star-Tribune, 10/2).