Medicare Compliance & Reimbursement

Medicare+Choice organizations would get a much-needed payment boost under bipartisan legislation proposed by Sens. Charles Schumer (DNY) and Rick Santorum (R-PA).

The bill (S. 590) “would fix the chronic underfunding of Medicare+Choice plans by creating a new method of federal HMO reimbursement,”

Schumer said a press release. It would adjust upward the three original M+C reimbursement formulas — fee-for-service, per-capita rate and the revised minimum payment increase — and add a “blend component,” which would combine the average of the minimum annual increase and the highest area-specific rate in the region. That would make it easier for HMOs to stay in high-cost regions like the Long Island suburbs, Schumer explained.

Schumer says that the bill, if passed, will “bring HMOs back to the suburbs.” The bill does not appear to remedy M+COs’ aversion to rural areas, however.

It remains to be seen whether Congress will grapple with S. 590 when much larger Medicare reform efforts are still on the table. But the American Association of Health Plans thinks that passing the bill would be the perfect way to tide over M+COs during the reform debate.

“As Congress and the administration work to reform Medicare, this legislation will work to fix the funding crisis undermining the Medicare+ Choice program for the past five years,” declared AAHP President Karen Ignagni.