Register Profiles a Small Medicare HMO That Continues to Offer an Unlimited Prescription Benefit

The Orange County Register profiles the Senior Care Action Network, a small Medicare+Choice health plan in Southern California that is "fighting hard to hold the line against fierce financial pressures." According to the Register, SCAN next year will continue to offer unlimited coverage for brand-name and generic prescription drugs, will not charge a copayment for hospital stays and will fully cover treatment for cancer, kidney failure and other related diseases and equipment such as wheelchairs or prosthetics. SCAN continues to offer these benefits while larger competitors are cutting benefits and raising copayments, the Register reports. SCAN can continue to offer its steady benefits because of its "particular status" as a "social HMO," one of four in the nation, which means that it gets "slightly" higher reimbursements from the government than other Medicare+Choice plans. SCAN earned the designation by serving a "high proportion of seriously ill elderly people" and providing members with "extra medical and social services intended to keep them out of nursing homes."

Maintaining SCAN's benefits "comes at a price," the Register reports. In September, the HMO put a cap on its membership, reaching it in October. Since then, the health plan has frozen enrollment in Orange County. According to SCAN CEO and Chair Sam Ervin, SCAN asked the federal government for permission to limit its enrollment "to guard against being inundated" by seniors leaving other Medicare+Choice plans. SCAN already has 52,309 members in four counties, almost 2,800 over its designated cap. SCAN next year will begin charging a premium of $30 per month and will create a tiered copayment system for generics and brand-name drugs while raising the copayments on all prescriptions. The Register reports that "Ervin says he doesn't know how long SCAN can hold out," with "lag[ging]" federal payments and other Medicare+Choice plans pulling out of the market. "We think the pharmacy benefit is so important that we stretched to keep it for one more year. ... Beyond that, I can't guarantee" (Wolfson, Orange County Register, 12/7).