Ask the Advisor: HMO Pulls Out: Prescription Drug Costs Increase 400%

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Ask the Advisor: HMO Pulls Out: Prescription Drug Costs Increase 400%

It’s a chore growing old having limited income, more than a fair share of ailments, and then having our HMO yanked from under us. Since my wife and I are over 70 and taking about seven maintenance drugs, we saw our Social Security checks increase by 2.5% and our medications bill increase 400%! Does that sound like common sense to you? Where are our elected Senators and Representatives who did nothing to stop this? Is there a logical explanation? I think someone in Washington should publish the reasons. We, the taxpayers and voters, have a right to know now, before the next election! —Nathan S., TX

From the editor:
This letter was received in May of 2001, but it remains just as timely today. According to the Medicare Right Center (MRC), a national consumer service organization, the problem of HMOs dropping out of Medicare and the disruption of coverage for thousands of enrollees is likely to be repeated for the fifth straight year in a row. At the time of this writing, the exact number of those affected is not yet known, but over the past four years, more than 2.2 million Medicare beneficiaries have scrambled to find a new health plan. Since most HMOs cover prescription drugs, hundreds of thousands of seniors have had to pay stiffly higher out-of-pocket costs. Most HMOs that continue to provide service sharply increased premiums and copayments and reduced benefits.

Deane Beebe, of MRC, advises Medicare HMO enrollees to “watch their mail and listen for news in October. HMOs are obligated by federal law to let members know in October if their plan will discontinue service. Those that are continuing to provide health care services must send a letter about 2003 premiums and benefits. It takes time to shop around for new plans and buy Medigap insurance (when you have no other HMO to choose from). October is not too soon to start!”

For a brochure about what to do if your HMO is ending its contract with Medicare or more information, contact the Medicare Rights Center, 1460 Broadway, 11th Floor, New York, NY 10036 or visit the MRC web site at http://www.medicarerights.org.

For more resources, read “Social Security & Medicare Q&A: Where Can I Find Information About Supplemental Insurance?” at http://www.tscl.org/NewContent/101413.asp.

October 2002