Local leaders are resisting yet another proposed site for a HCFA demonstration of competitive bidding by Medicare health plans.
This time the site is Phoenix, where a local advisory board last week voted to ask Congress to delay a test of competitive bidding for a year, until 2001.
The 21-member Phoenix Area Advisory Committee voted to recommend the delay at its organizational meeting, where it heard testimony from providers, plans and beneficiaries. They said the competitive marketplace for Medicare HMOs already works well in Phoenix.
In addition, beneficiaries said they fear the project could reduce benefits and raise out-of-pocket costs.
In January, the national Competitive Pricing Advisory Committee selected Phoenix and Kansas City, Kan., as the sites to test competitive bidding (Jan. 11, p. 10).
Under the proposed pilot, plans that want to continue enrolling Medicare beneficiaries must submit bids to cover the Medicare benefit package. The CPAC will evaluate those bids and select a government reimbursement that equals either the average or median of those bids.
Plans that bid higher than the government rate would have to absorb the cost difference or charge beneficiaries a premium. Plans that bid lower could expand the benefit package or pocket the difference.
Congress created 15-member CPAC in 1997, but that same year resistance from plans and lawmakers led to the rejection of proposed projects in Baltimore and Denver.