Medicare Managed Care:

HCFA Missing Opportunities to Provide Consumer Information

T-HEHS-97-109: Published: Apr 10, 1997. Publicly Released: Apr 10, 1997.

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William J. Scanlon
(202) 512-7114


Office of Public Affairs
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GAO discussed: (1) Medicare beneficiaries' need for comparative information on health maintenance organizations (HMO); and (2) steps the Health Care Financing Administration (HCFA) could take to meet that need promptly.

GAO noted that: (1) HCFA does not distribute to beneficiaries comparative consumer guides such as those the federal government and many employer-based health insurance programs routinely distribute to their employees and retirees; (2) without these guides, beneficiaries cannot easily compare HMOs; (3) marketing materials distributed by HMOs are of little help because HMOs describe their benefits and costs using different terms and formats; (4) although beneficiaries lack information on HMOs, HCFA does not; (5) HCFA amasses volumes of information that could be summarized, packaged, and distributed to help beneficiaries choose among competing Medicare HMOs; (6) for example, HCFA compiles information that can be used to construct HMO benefit comparison charts; (7) HCFA also routinely collects other information, such as disenrollment rates, beneficiary complaints about HMOs, and the results of HCFA's HMO monitoring visits, that could be provided to beneficiaries; (8) because some plans do a better job of retaining Medicare beneficiaries than others, disenrollment rates, an indicator of beneficiary satisfaction, may be especially useful in helping beneficiaries distinguish among competing HMOs; (9) for example, GAO's analysis of HCFA's data showed that 1995 annual disenrollment rates ranged from 4 to 42 percent among Los Angeles HMOs and from 12 to 37 percent among Miami HMOs; (10) HCFA has initiatives, planned or under way, that will make some comparative HMO information available to beneficiaries; (11) although these initiatives are steps in the right direction, they are very small steps; and (12) with little additional time and effort, HCFA could do much more to help Medicare beneficiaries make informed selections among available HMOs.

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