Proposals To Boost Reimbursements to Medicare+Choice Plans Would Not Expand Enrollment

Proposals to increase reimbursements to Medicare+Choice plans would "stabilize" enrollment in the program at about five million beneficiaries in the "best-case scenario" and would decrease enrollment to about 3.3 million beneficiaries by 2005 in the "worst case," according to a new study published Wednesday on the Health Affairs Web site (Health Affairs release, 8/17). In the study, titled "Medicare+Choice: Current Role and Near-Term Prospects," Kenneth Thorpe and Adam Atherly of the Department of Health Policy and Management at Emory University analyzed four proposals and determined their impact on Medicare+Choice reimbursement rates and enrollment through 2005. A Bush administration proposal, which would increase Medicare+Choice reimbursements by an average annual rate of 4.6% between 2002 and 2005, would "essentially stabilize" enrollment in the program at about five million beneficiaries but would cause a "slight reduction" in the program's market share nationwide, the study found. A bill (HR 3584) proposed by Rep. Nancy Johnson (R-Conn.), which would increase Medicare+Choice reimbursements by an average annual rate of about 2.5% between 2002 and 2005, would decrease enrollment in the program from about 5.3 million currently to about 4.3 million by 2005, according to the study. The study found that a Medicare Payment Advisory Commission proposal, which would "align Medicare+Choice payments to fee-for-service spending per capita in each county over the next four years," would decrease enrollment in the program to about 3.3 million beneficiaries by 2005. Under current law, enrollment in Medicare+Choice would decrease to 4.1 million beneficiaries, the study found. The study also analyzed the impact of the elimination of Medicare+Choice. According to the study, if the program were eliminated, 30.3% of former Medicare+Choice enrollees would enroll in fee-for-service Medicare, 52% would purchase a Medigap plan and 17.9% would enroll in Medicaid (Thorpe/Atherly, "Medicare+Choice: Current Role and Near-Term Prospects," Health Affairs, 7/18).