Add Medicare-contracting HMOs to the list of providers that want relief from the spending restraints of the Balanced Budget Act of 1997.
The American Association of Health Plans said last week that its members want $13 billion in additional payments over five years.
Meanwhile, the hospital industry is seeking $25 billion in Medicare relief in the same period. Other groups seeking Medicare dollars include nursing homes, home health agencies and some specialists.
Here's where the $13 billion for HMOs would come from, according to AAHP President Karen Ignagni:
* A change in the risk-adjustment process, which compensates health plans that have sicker members by reducing payments to plans that have healthier members.
* Better funding of the "blended" payment rates, which aim to equalize capitation payments between high-cost and low-cost counties and also to encourage plans to expand into lower-cost counties.
* Medicare payments that are close to 95% of what fee-for-service Medicare pays providers. Some plans receive only 70% or 80%, Ignagni said.
"We have been saying that this program is in crisis, but there are a number of people who are in denial that there is a problem," Ignagni said. "Still, I believe the members of Congress are going to save this program."
But Congress may not act in time for health plans, which must notify HCFA by July 3 as to whether they will continue participating in Medicare managed care. It is unlikely that Congress will act on any Medicare relief legislation before September.
"What you're going to see is plans being forced to make a decision before Congress can act in the fall," Ignagni said. "They may have language (in the legislation) that allows plans to opt back in if they opt out in July, but we don't know."
Ignagni did not rule out another massive pullout from the Medicare managed-care program. Late last month, Aetna U.S. Healthcare sent up a red flag when it announced withdrawals from its Medicare business in some cities, despite a gain in its earnings (May 1, p. 8).
As part of its lobbying efforts, the AAHP is bringing more than 100 beneficiaries to Capitol Hill this week to meet with members of Congress.
The Health Insurance Association of America, which also represents Medicare managed-care plans, shares AAHP's concerns. It is supporting a bill introduced last month by Rep. Mark Foley (R-Fla.) that would alter the risk-adjustment process to be more to plans' liking.
In the end, health plans' $13 billion wish list may end up competing with hospitals' $25 billion in Medicare demands.
"There are a lot of competing interests out there this year--the Medicare prescription drug benefit, others looking for assistance from Medicare--and there's a finite pie to divvy up," said Herb Kuhn, vice president of advocacy at the Premier hospital alliance. "But, hopefully, there will be enough for everyone."