More private plans to join Medicare

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Reversing a trend in which private health plans have been quitting the federal Medicare program, U.S. officials Wednesday announced that more plans will join next year.

Also, existing plans will expand the areas they serve, and most plans will reduce the premiums and other costs they charge patients.

"We’re stabilizing the Medicare Advantage program,” Medicare Administrator Mark McClellan told reporters, referring to the private plan program that was renamed in last year’s Medicare Modernization Act.

Health and Human Services Secretary Tommy Thompson announced that 35 new plans have applied to offer coverage starting next January and 22 plans applied to expand the number of counties they now serve.

If the applications are approved, as is expected, an additional 1.6 million Medicare beneficiaries in 11 states would have access to a private HMO offering them benefits over and above what Medicare’s government-run fee-for-service program offers.

About five million of Medicare’s 41 million beneficiaries are currently in Medicare Advantage plans, which also restrict their choice of doctors, hospitals, and other providers.

Thompson said plans are also proposing to reduce premiums and other patient costs by an average of about 10 percent.

Even with the additions, however, plans will still only be available to two- thirds of Medicare beneficiaries. Lawmakers and Medicare officials hope that regional “preferred provider organizations” set to begin in 2006 will offer private plan coverage in rural areas that HMOs now shun.

The size and makeup of those regions, however, has not yet been determined. McClellan said he hopes final rules will be published by “early next year.”

On another subject, McClellan also declined to say exactly when an HHS task force looking at the safety of importing drugs from Canada and other countries will submit its final report.

That task force was set up under the Medicare law, and is required to report by December 8. However, Thompson said earlier this year he hoped the group would complete its work by the end of the summer.

McClellan, who is a member of the task force, said the staff is still analyzing data collected during several “listening sessions” last spring. Congress has also been wrestling with whether to relax existing restrictions on drug imports, although action on the politically potent issue appears highly unlikely. Congress is expected to adjourn at the end of the week until after the November elections. 

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