The high cost of Choice

Despite the fact it was created to cut costs, Medicare spent $5.2 billion more in 1998 on beneficiaries in Medicare+Choice plans than it would have if those beneficiaries had been enrolled in traditional fee-for-service, reports the General Accounting Office (GAO). That means, Medicare is spending 21% more on seniors in HMOs than those in traditional fee-for-service option, the GAO estimates.