-Caveat Lector-
Begin forwarded message:
From: [EMAIL PROTECTED]
Date: June 16, 2007 9:00:11 PM PDT
To: [EMAIL PROTECTED]
Cc: [EMAIL PROTECTED], [EMAIL PROTECTED], [EMAIL PROTECTED]
Subject: The Real Goal in "Privatizing" Medicare: FRAUD for PROFIT
Insurers agree to back off
on Medicare plans
fee-for-service policies under fire for fraud
Victoria Colliver
San Francisco Chronicle, June 16, 2007
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2007/06/16/
BUGDGQG9K81.DTL
Seven large insurers on Friday agreed to suspend marketing of a
form of Medicare policy after complaints were made about
questionable sales tactics and outright fraud associated with the
plans.
The companies, including UnitedHealth Group, Humana and WellCare,
said they will stop marketing the policies, known as private fee-
for-service plans, until they can prove to Medicare officials that
sales materials are accurate, agents understand the policies and
consumers intend to enroll.
The action comes in response to consumer complaints and a Senate
committee hearing last month that looked into abuses. The plans are
sold by private insurers as alternatives to traditional Medicare.
Some agents violated Medicare rules by showing up uninvited at
senior citizens centers, misleading beneficiaries about the
products and, in a few cases, forging signatures to increase sales,
according to government officials and consumers. In some cases, the
agents erroneously assured new enrollees that their doctors would
accept the policies.
"This voluntary agreement demonstrates the plans are stepping up to
assure deceptive marketing practices end and beneficiaries fully
understand what they are purchasing," said Abby Block, director of
beneficiary choices for the Centers for Medicare and Medicaid
Services.
About 1.3 million senior and disabled Medicare beneficiaries are
enrolled in Medicare fee-for-service policies, the fastest growing
form of Medicare managed-care plans. They differ from traditional
Medicare because they are managed by private companies and
sometimes offer more benefits than straight Medicare, such as
dental and vision coverage.
Under the agreement, the seven insurers -- which together sell
about 90 percent of Medicare fee-for-service plans -- will test
sales representatives on their product knowledge and register them
with the government.
The insurers agreed to put disclaimers in marketing materials and
telephone new enrollees to make sure they understand the policies
and genuinely intend to enroll. Failure to comply could lead to
suspension or fines. While they agreed to suspend their marketing
activities, the insurers can continue to sell the policies.
Other companies that signed on to the temporary suspension include
Coventry Health Care Inc., Universal American Financial Corp.,
Sterling Life Insurance Co. and Blue Cross/Blue Shield of Tennessee.
America's Health Insurance Plans, the industry's trade group,
supported the agreement but stressed that the vast majority of
agents and brokers are ethical and knowledgeable about their products.
Health advocates said the action is a good start but fails to
address what they say is the root cause of the abuse -- the fact
the federal government reimburses private insurers for fee-for-
services policies at a higher rate than other types of Medicare
plans. Sales agents, in turn, receive higher commissions.
"Money is a driving force for both the plans and agents, and that
is driving a lot of the marketing misconduct we're seeing," said
David Lipschutz, staff attorney for California Health Advocates.
Lipschutz said changes to reimbursement levels would require
congressional authority.
"This will do virtually nothing to protect Medicare beneficiaries
and is a pathetic attempt to preempt Congressional action," Rep.
Pete Stark, D-Fremont, a longtime critic of Medicare fee-for-
service plans, said in a statement.
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