Study: HMO Pullouts Will Hurt Only a Few Medicare Markets.

The overall impact of the pullouts of 65 health maintenance organizations from the Medicare+Choice program may be less than first perceived, a new study said.

The study by MCOL, a health-care information technology company, found that while some specific markets will be affected by the withdrawals, most regional markets will not be materially affected. MCOL said that almost half--49% or 459,000 of the beneficiaries--came from two companies, Aetna and Cigna. But MCOL said that only 17% of the nearly 1 million members affected by the pullouts are in markets where there is no other Medicare HMO.

In announcing those pullouts on July 24, the Health Care Financing Administration said 53 HMOs would reduce services as of Jan. 1, 2001, forcing a total of more than 934,000 seniors to find other means of coverage. That figure was about 30% higher than an estimate released by the American Association of Health Plans in late June. The HMOs blame declining Medicare government reimbursements for their departure.

Texas residents will be hit the hardest, the study found. The state has 180,749 people, or 55% of its total Medicare HMO membership, affected by the pullouts. Nationally, seven counties had five or more plans withdraw, and six of these seven are in Texas.

The managed-care industry, as well as other organizations, will beat the drums across the United States to generate more interest among seniors for improvements in Medicare, higher payments for plans and providers and reduced regulations, with the expectation that these issues will be passed along to members of Congress when they go home to their districts.

AAHP is seeking $15 billion in extra funding from Congress over five years for Medicare+Choice.