SEPT. 18, 2000

Medi-Minutes
Medicare HMO Withdrawals Effect Fewer Seniors in '99

A recent report by the Office of the Inspector General (OIG) of the Department of Health and Human Services states that Medicare withdrawals in 1999 affected fewer beneficiaries than the 1998 withdrawals but left more beneficiaries without HMO options.

HMO withdrawals in 1998 affected about 400,000 seniors, while 1999 withdrawals affected about 300,000. However, beneficiaries who were dropped had fewer options in 1999 than in 1998. In fact, the percentage of dropped beneficiaries who had no HMO available to join jumped from 12% in 1998 to 30% in 1999. And only 55% of affected beneficiaries joined another HMO after being dropped in 1999, compared to 66% in 1998.

Most beneficiaries who did sign up with a new HMO reported few transition problems. About 18% reported problems, mostly pertaining to increased cost, especially of prescription drugs. But beneficiaries reported the quality of their healthcare to be about the same after their HMOs withdrew. Most (90% of beneficiaries who went to traditional Medicare and 69% of those who joined another HMO) said they were able to stay with the same primary care physician.