The Clinton administration last week released the final tallies on the number of health plans pulling out of Medicare as of Jan. 1, 1999, and it assailed those plans. It also announced it will speed the entry of new plans into areas where there are no managed-care options.
A total of 43 plans withdrew from the Medicare program, affecting nearly 415,000 enrollees, according to HCFA. More than 45,000 of those seniors are in areas where managed-care options will no longer exist.
Managed-care companies Foundation Health Systems, Oxford Health Plans and WellCare Management Group were last-minute participants in the flurry of health plans recently announcing exits from selected Medicare HMO markets.
Woodland Hills, Calif.-based FHS, parent of the HealthNet HMO, said Oct. 5 it will not renew Medicare risk contracts in 18 counties in California, Colorado, New Mexico and Washington state, representing 7,000 enrollees.
This pullback, combined with pullouts in Northern California, Connecticut and New Jersey announced this summer, brings the total number of FHS enrollees affected to about 22,700 in 32 counties
"FHS is committed to its Medicare line of business; however, we cannot continue to operate in areas where reimbursement rates don't reflect trends in actual medical costs," said Jay Gellert, FHS' chief executive officer.
Oxford Health Plans of Norwalk, Conn., said it will slash its Medicare HMO enrollment by 17%, or 26,500 enrollees, by exiting Medicare markets in 24 counties in Connecticut, New Jersey, New York and Pennsylvania.
Finally, WellCare Management of Kingston, N.Y., will leave the Medicare risk business in four New York counties where it now has 4,200 Medicare enrollees, about 41% of its total Medicare membership.
Meanwhile, at a White House ceremony, President Clinton criticized the plans' exit. He said Medicare would not allow plans to raise their enrollee costs or cut benefits next year as they have asked.
Charles Kahn, president-designate of the Health Insurance Association of America, called Clinton's attack a "politically motivated smoke screen intended to cover up the administration's complicity in driving up costs to private health plans."
Clinton said HCFA will expedite the application of any plan asking to enter a market with no managed-care options.
Forty-eight health plans have applications pending at HCFA; four are provider-sponsored organizations. It is unknown how many want to enter areas with no managed-care plans.