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Lawmakers to Seek Medicare+Choice ‘Lock-in’ Repeal

Originally published by Reuters Health, October 15, 2001

WASHINGTON (Reuters Health) — Seniors will maintain their right to leave Medicare managed care plans within a few months of signing up, under legislation due to come before Congress later this week.

Lawmakers are pushing for the change, hoping that it will increase the attractiveness of the struggling Medicare managed care program, also known as Medicare+Choice.

Meanwhile, seniors will this week begin seeing television ads designed to promote Medicare+Choice and other federally funded healthcare options, government officials said.

Lawmakers are planning to introduce a measure to repeal a law that takes away seniors’ ability to get out of Medicare+Choice plans within a year of joining. Under current law, seniors enjoy a window allowing them to leave Medicare+Choice within six months of opting in. That window narrows to three months next year and closes completely in Fiscal 2003.

The legislation would do away with a part of the 1997 Balanced Budget Act known as the “lock-in” because it locks seniors in to Medicare+Choice plans for a full year starting in 2003, according to a House Democratic aide familiar with the bill.

Julie Goon, a lobbyist with the American Association of Health Plans (AAHP), said that HMO’s in the organization support the proposal to eliminate the lock-out provision. Managed care plans worry that they will have a hard time attracting seniors’ participation in the troubled program if the law requires them to stay in for a full year.

Plans want to avoid any further hurdles for Medicare+Choice. At its creation in 1997, lawmakers envisioned the managed care option would be selected by a third of Medicare beneficiaries. Instead, the program now covers less than 13% of the Medicare population, according to government figures. Federal officials announced a few weeks ago that 536,000 Medicare beneficiaries would lose coverage this year, as more health plans pull out of the program.

Repealing the lock-in “is a no-brainer” to Senate Finance Committee Chair Max Baucus, D-MT, according to Jon Blum, a senior committee aide. Baucus believes that the lock-in “adds too much complexity to an already complex system,” Blum said at an AAHP meeting in Washington on Monday.

But at least one key Republican remains opposed to repealing the one-year lock-in. House Ways and Means Committee Chair Bill Thomas, R-CA, “has reservations about repealing the one-year commitment,” said John McManus, a Republican aide on the committee’s subpanel on health.

But the flagging Medicare+Choice program could get a boost from a $30 million public relations campaign due to hit television airwaves this week. The ads, designed to encourage seniors to call a toll-free hotline to find out about their Medicare choices, will feature comedy actor Leslie Neilson, star of the Naked Gun films. Ads will begin airing on Spanish-language television stations this Wednesday and will appear on English stations starting Friday, according to Centers for Medicare and Medicaid Services (CMS) Administrator Thomas Scully.

The ads were due to come out in September but were delayed by the September 11 attacks on New York City and the Pentagon.