By: Health Insurance
Submitted: 2009-08-24 09:54:30 | Word Count: 747
The nonprofit insurer says it can no longer afford the programs for the 36,000 enrollees, including nearly 12,000 in Bucks and Montgomery counties.
The Philadelphia region's largest insurer has announced plans to drop two health plans for senior citizens, saying they cost too much. One of the plans serves only the poor.
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Independence Blue Cross has started sending early cancellation notices to members in the Keystone 65 Complete plan, which covers elderly adults who are so poor they also qualify for Medicaid benefits.
People enrolled in the Keystone 65 Value program, the only Blue Cross Medicare plan with no monthly premium, will be sent official notices soon.
The nonprofit insurer, which earned $358.8 million in revenue last year, says it can no longer afford the programs for the 36,000 enrollees. The company cited "unprecedented" funding cutbacks regionally and nationally for Medicare Advantage plans and increased medical costs. The plans will be dropped Jan. 1.
The Keystone 65 Complete plan has 19,000 members, including 4,700 in Bucks and Montgomery counties. Keystone Value, which has 17,000 people enrolled, including 7,000 in Bucks and Montgomery counties, is available to any Medicare-eligible member.
Both are Medicare Advantage managed care plans, which fill the coverage gap in traditional Medicare coverage and offer additional benefits, such as care coordination, fitness reimbursement, preventive care and wellness programs.
Keystone Complete members face two choices, Independence Blue Cross spokeswoman Ruth Stoolman said. They can enroll in a Medicare Advantage plan with another insurer once the open enrollment process begins in October, or they'll be auto-enrolled under traditional Medicare and Medicaid benefits and enrolled in a Part D drug plan in January.
Either option could require the members to change health care providers.
Keystone Value plan members can expect to see their monthly costs more than double if they stay with Independence Blue Cross.
Value members now pay $23.90 a month for Part D drug coverage. The second cheapest Blue Cross Medicare Advantage plan is Keystone Advantage, which has $50 monthly premium and charges $87.60 for Part D coverage, though those rates could change next year.
The decision to cancel the policies was difficult, Stoolman said.
"It's not just reimbursements which have significantly decreased from the government, but rising medical costs, that are the trouble," she added. "Typically, this population is heavy users of health care services."
Alissa Halperin, an attorney and deputy director of policy advocacy for the Pennsylvania Health Law Project, a health care advocacy group, worries that plan members, who are mostly frail, low-income seniors, will slip under the radar.
She added that since the Centers for Medicare and Medicaid Services doesn't have to reveal what companies will continue their Medicare contracts until October, it's unclear what choices will be available. It's possible other area insurers will also drop Medicare Advantage plans for Medicare-Medicaid-eligible subscribers, she added.
It's critical that affected subscribers get individual counseling to prevent disruption in health care services, Halperin said.
Next year, the federal income subsidy program that helps seniors pay part of their Part D premiums and copays will expand its income eligibility, she added. Those enrolled in the Value plan who need to buy more expensive coverage may get some help paying for it - if they enroll.
"It's going to have a tremendous impact," Halperin said. "There aren't that many choices. It's a company people have known for a long time and have largely trusted and we're really concerned where people are going to end up."
In February, the Centers for Medicare and Medicaid Services, a branch of the U.S. Department of Health and Human Services, told insurers to expect federal reimbursement cutbacks in the range of 4 percent for Medicare Advantage plans. The centers doesn't allow plans to submit bids for insurance plan that will lose money.
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