Medicare HMO rates will rise an average of 10.6% starting March 1 as part of the new Medicare reform law, the CMS said. The actual increase will vary by county. Previously, Medicare health plans had been scheduled to receive an average increase of 3.2% throughout 2004. The CMS said Medicare HMOs that planned to leave the program or reduce benefits under the previous payment update have until Jan. 30 to reconsider and submit new plans to the agency. Health plans must use the additional funds to reduce beneficiary costs, enhance benefits, improve provider networks or protect against future premium increases or benefit reductions. In a written statement, Rep. Pete Stark (D-Calif.) criticized the mandated increase, calling it the "first step in the new Medicare law's march toward privatization. . . . This money would have been better spent improving the fundamentally flawed drug benefit or making other improvements to the underlying Medicare program." Some 4.6 million of Medicare's 41 million beneficiaries are enrolled in HMOs. View the payment rates. -- by Tony Fong
Medicare HMOs gain big rate increase under new law
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