Speier Accuses Medicare+Choice Plans that Drop Coverage in Certain ZIP Codes of ‘Cherry-Picking’
Sen. Jackie Speier (D-Hillsborough), chair of the Senate Committee on Insurance, said yesterday that many California Medicare+Choice plans have eliminated "crucial benefits" for beneficiaries and have "sliced up counties to avoid patients in certain ZIP Codes," the Los Angeles Times reports. "In some counties, seniors living on one side of the street have the option for HMO coverage and seniors living on the other side of the street ... don't," Speier said during a committee hearing. "It's called cherry-picking," she said, "and we don't allow it in many other industries." According to Barbara Weller of the Medicare regional office in San Francisco, California accounted for 14 of the 20 cases across the nation in which an HMO sought to withdraw in 2002 from only part of a county. HMO representatives denied that they "draw boundaries to eliminate high-cost patients" and said that they only "pare back their coverage areas" for Medicare beneficiaries when they cannot negotiate "reasonable" reimbursement rates with doctors and hospitals. They also "blamed" the federal government for "underfunding" the Medicare+Choice program. "We have to cover what we can cover with the funding we've got," Nancy Monk, vice president of public affairs for PacifiCare of California, said.
Sen. Ross Johnson (R-Irvine) defended the practice of withdrawing from Medicare+Choice in certain ZIP Codes. "We ought not discourage that if the result (otherwise) is taking coverage away from everyone in a county," he said. The Times reports that changes to Medicare+Choice are "particularly sensitive" in California, as 38% of Medicare beneficiaries in the state are enrolled in a managed care plan, compared to 15% nationally. In 2002, about 84,000 California seniors will have to select new Medicare+Choice plans or return to traditional fee-for-service Medicare as a result of HMO withdrawals from Medicare+Choice (Ornstein, Los Angeles Times, 12/13).