Medicare+Choice:

HCFA Actions Could Improve Plan Benefit and Appeal Information

T-HEHS-99-108: Published: Apr 13, 1999. Publicly Released: Apr 13, 1999.

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Pursuant to a congressional request, GAO discussed the: (1) accuracy, completeness, and usefulness of the information Medicare managed care organizations (MCO) distribute about their plans' benefit packages; (2) extent to which MCOs inform beneficiaries of their plan appeal rights and the appeals process; and (3) Health Care Financing Administration's (HCFA) review, approval, and oversight of the plan information that MCOs distribute.

GAO noted that: (1) it found problems with the benefit information distributed by all of the 16 MCOs it reviewed; (2) although HCFA had reviewed and approved all of the information GAO examined, some MCOs misstated the coverage they were required by Medicare or their contracts to offer; (3) one MCO advertised a substantially less generous prescription drug benefit than it had specified in its Medicare contract; (4) some MCOs provided complete benefit information only after a beneficiary enrolled; (5) others never provided full descriptions of benefits and restrictions; (6) as GAO has reported previously, it is difficult to compare available options using literature provided to beneficiaries because MCOs use different formats and terminology to describe the benefit packages being offered; (7) the variation in Medicare plan literature contrasts sharply with the uniformity of plan information distributed by MCOs that participate in the Federal Employees Health Benefits Program (FEHBP); (8) MCOs participating in FEHBP are required to provide prospective enrollees with a single, comprehensive, and comparable brochure to facilitate informed choice; (9) in GAO's study of the appeals process, GAO found that when MCOs deny plan services or payment, they do not always inform beneficiaries of their appeal rights; (10) sometimes MCOs issue denial notices that do not contain all the information that HCFA requires; (11) GAO also found that some MCOs delay issuing denial notices until the day before discontinuing services, such as skilled nursing care; (12) this delay can increase a beneficiary's potential financial liability should the beneficiary appeal the plan's decision and lose; (13) many of the information problems GAO identified regarding plan benefit packages and beneficiaries' appeal rights went uncorrected because of shortcomings in HCFA's review practices; (14) in addition, HCFA has not exercised its authority to require MCOs to distribute plan information that is more complete, timely, and comparable; (15) agency officials recognize many of the shortcomings GAO identified and are beginning efforts to address them; and (16) however, GAO believes that the agency could do more.

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