MEDICARE+CHOICE: Scripps Clinic Halts Enrollment
Beginning Nov. 1, San Diego-based Scripps Clinic will no longer accept new Medicare HMO members, the San Diego Union-Tribune reports. "There's a question about the viability of Medicare HMOs," Scripps Clinic Health Plan Services President Marc Reynolds said. Calling the decision "a financial issue," Reynolds said that physician groups such as Scripps will not be able to negotiate better rates until the government raises its reimbursements. The clinic currently has 19,000 members enrolled in a Medicare HMO and 27,000 members in fee-for-service Medicare; but, the new decision will not affect those members already receiving care at the clinic. The Union-Tribune reports that it is "unusual" for a provider such as Scripps Clinic to halt enrollment because physician groups receive "comparatively high Medicare rates." Although rates for Medicare HMO members are four times higher than commercial rates, Reynolds indicated that "higher utilization of health care services among Medicare recipients eat up any additional profits." Representatives from Health Net and PacifiCare Health Systems Secure Horizons, two Medicare HMOs that contract with by the clinic, said they are "continuing to negotiate with Scripps Clinic" and hope to "reverse its decision." Aetna, the clinic's third health plan, did not comment on the issue. Reynolds said that the clinic's decision is "final and not up for negotiations" (Fong, San Diego Union-Tribune, 9/26).
A Money-Losing Policy?
Starting Jan. 1, more than half of the one million seniors enrolled in PacifiCare, the nation's largest operator of Medicare+Choice programs, will have to pay monthly premiums ranging from $19 to $99, the Los Angeles Times reports. However, industry analysts predicted Monday that the insurer could lose money next year if the higher premiums cause healthy customers to drop coverage. The company's stock has fallen 25% since it announced the premium hikes earlier this month. PacifiCare has dropped out of the Medicare HMO market in several states, but decided to stay in California, where the insurer has 600,000 members in its Secure Horizons plan. To remain in the state's Medicare business, the company is raising prices in several counties (Bloomberg News/Los Angeles Times, 9/26).