NCPA - National Center for Policy Analysis

GAO Faults Medicare HMOs' Disclosures

April 13, 1999

The General Accounting Office says health maintenance organizations are distributing "inaccurate or incomplete benefit information" to their elderly members. The congressional watchdog agency also took the Health Care Financing Administration, which runs Medicare, to task for weak oversight of the health plans and the marketing and information materials they produce.

  • After reviewing marketing information provided by 16 health plans in four regions of the country, the GAO found that almost half of the HMOs distributed materials that incorrectly described benefits and the need for referrals.
  • For example, five health plans said that beneficiaries needed doctors' referrals to get an annual mammogram -- when, in fact, Medicare specifically prohibits that practice.
  • Moreover, some plans don't provide complete information about benefits and restrictions until after a beneficiary enrolls -- if then.
  • About seven million people -- 17 percent of the Medicare population -- are enrolled in managed-care plans.

The GAO said that although the HCFA had reviewed and approved the marketing materials, the agency had failed to take some basic steps -- such as ensuring that identified errors were corrected before the materials were distributed.

Today, the Senate Special Committee on Aging is scheduled to hold hearings on this report -- as well as a another report calling for greater government oversight of the Medicare appeals process.

Source: Laurie McGinley, "Medicare HMOs Offer the Aged Flawed Data," Wall Street Journal, April 13, 1999.


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