News Briefs: GAO reports that HMOs still leaving Medicare
Investigators from the General Accounting Office (GAO) are reporting that despite two years of increased payments to HMOs, they continue to leave the Medicare program and few are returning. Medicare payments for the average HMO increased approximately $16 a person per month to $431. The government had anticipated that with higher payments, HMOs might be persuaded to stay in the program.
Worse news still, those that have indicated they will stay with the program are reporting that they will dramatically increase premiums, copayments and other fees. UnitedHealth Group has announced its intention to charge Medicare beneficiaries in Wisconsin $295 for each day they spend in the hospital, up to a year limit on all out-of-pocket expenses of $4,800.
The GAO reported that HMOs, rather than improve services for the elderly, used increased fees to increase payments to hospitals and other health care providers. HMOs claim the reason behind this is that health care inflation has far surpassed the increases they have received with Medicare reimbursement.
Currently, 5.6 million people out of a total 40 million enrolled in Medicare receive health care through HMOs. On Jan. 1, more than 500,000 elderly were dropped from their HMOs as they withdraw from the Medicare program. Last year, 933,600 elderly were dropped, in 2000 327,000 were dropped, and in 1999 407,000.
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