August 2002

Grant Results

SUMMARY

From 1994 to 1999, an expert committee at the National Academy of Sciences - Institute of Medicine (IOM) developed recommendations on how to ensure that Medicare beneficiaries have adequate information and protections when they consider enrolling in managed care plans.

The committee also detailed ways to implement the recommendations developed under the first grant.

Key Recommendations and Results

  • Allow beneficiaries a maximum of choices by giving them access to all plans available in their local market and the option to remain in traditional fee-for-service plans.
  • Require plans to market their services at the same time of year and have the federal government use common definitions for describing plan quality to promote comparability.
  • Develop a Medicare customer service center to explain to beneficiaries their options in Medicare plans.
  • In 1998, the IOM held a workshop that focused on developing an information infrastructure for Medicare.
  • In a "letter report" to the Health Care Financing Administration (HCFA), the federal agency that administers Medicare, the committee outlined recommendations for implementing new legislation that authorized HCFA to contract with greater numbers of managed care plans.

    The committee recommended that HCFA conduct further testing and stagger proposed mailings announcing an expansion of the Medicare managed care program.

Funding
The Robert Wood Johnson Foundation (RWJF) supported this project through two grants totaling $343,016.

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THE PROBLEM

Many policymakers have viewed managed care as a potential solution to the growing cost of Medicare. As efforts moved forward in the mid-1990s to shift Medicare patients into managed care plans, experts and patient advocates sought to ensure that the necessary information and protections were in place to enable patients to select wisely among available plans and to retain access to high-quality care.

In some areas of the country, including California, where managed care plans were already enrolling large numbers of Medicare beneficiaries, the elderly faced a bewildering array of plan options with little information to guide their decisions. At the time of the first grant, the Medicare reform provisions of the Balanced Budget Act of 1995 were pending before the US Congress; this legislation, which was ultimately vetoed, would have allowed greater numbers of Medicare beneficiaries to enroll in managed care plans.

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THE PROJECT

These grants from RWJF supported the development of recommendations on how to ensure that Medicare beneficiaries have adequate information and protections when considering enrolling in managed care plans. The project was led by the IOM, a division of the independent, nonprofit National Academy of Sciences, which advises Congress on health, science, and technology issues.

Grant ID# 027343

This grant provided funds to organize and convene a two-day invitational symposium on consumer protection and accountability in Medicare managed care. A 10-person advisory committee planned the symposium and issued recommendations (see the Appendix for a list of advisory committee members).

The IOM committee used the proposed Medicare reform provisions as a template for its work. The Kansas Health Foundation ($25,000), the Commonwealth Fund ($25,000), and the Pew Charitable Trusts ($25,000) provided additional funding for this project.

The symposium, "Choice and Managed Care: Assuring Public Accountability and Informed Purchasing by and on behalf of Medicare Beneficiaries," was held February 1–2, 1996 in Washington, D.C. Approximately 50 people from 40 organizations attended the symposium, which featured nine invited presentations from experts and discussion with respondents.

Following the symposium and its own deliberations, the IOM committee published its recommendations in a book entitled Improving the Medicare Market: Adding Choice and Protections.

Grant ID# 031002

Under this grant, the IOM committee examined ways to implement its recommendations. At the time of this grant, Congress had passed the Balanced Budget Act of 1997, which expanded Medicare health care options for beneficiaries by creating the Medicare+Choice program. The law gave HCFA, which administered the Medicare program, the authority to contract with a greater variety of managed care and fee-for-service plans. HCFA was required to mail an announcement explaining the new Medicare+Choice program to all Medicare recipients within several months of the law's passage.

March 4–5, 1998, IOM held a workshop, "Developing the Information Infrastructure for Medicare Beneficiaries" in Washington, D.C. Some 24 people from 17 organizations attended the workshop, which featured four keynote presentations and five panel discussions. The committee produced a summary of the workshop and issued recommendations in the form of a "letter report" to the administrator of HCFA.

According to IOM, a "letter report" outlines findings from a panel or commission on an issue of importance to a government agency.

Recommendations (ID# 027343)

In Improving the Medicare Market: Adding Choice and Protections, the IOM committee offered a number of recommendations, including:

  • All Medicare health plans in a local market should be available to Medicare beneficiaries to increase the likelihood that they can find an appropriate plan. The committee felt that older people should have access to the largest possible number of health plans to increase the chances that they would find a convenient plan that included their primary care physicians. At the time of this project, Medicare managed care was primarily available through employers, which typically offered their workers only one or two managed care plan options. The committee also recommended that traditional Medicare be maintained as an acceptable "safe harbor" for beneficiaries, especially those who are physically and mentally frail.
  • Special efforts should be directed to build a Medicare customer service center, a consumer-oriented infrastructure that employs information and customer service techniques developed in the private sector. The committee recommended that the federal government contract with and oversee a private, nonprofit agency to provide telephone access to representatives who can explain to beneficiaries their Medicare plan options.
  • The federal government should require all Medicare plans to be marketed at the same time to enable beneficiaries to adequately assess and compare the benefits and prices of the various options. The government should develop common definitions for reporting plan quality to aid beneficiaries in comparing plans and making choices.
  • The Medicare program should consider establishing a special board to administer the Medicare+Choice process and to hold all Medicare plans accountable. HCFA has traditionally administered a fee-for-service Medicare program, which is quite different from managed care. A Medicare "market board" could recruit leadership and staff with the business and technical skills needed to oversee the Medicare managed care program.

Recommendations (ID# 031002)

In its Letter Report to the Administrator of the Health Care Financing Administration on Developing an Information Infrastructure for the Medicare+Choice Program, the IOM committee offered a number of recommendations, including:

  • HCFA should delay its initial mailing on the Medicare+Choice program until market testing demonstrates that the differences among the various health plans and benefit packages are presented in a standardized, easily understandable way.
  • HCFA should focus on conveying a few key messages and answering a few questions of greatest concern to elderly consumers. For example:
    1. Will I be able to continue seeing my current physician?
    2. Will I be able to see a specialist if I think I need one?
    3. Will the plan save me money, and if so, how?
    4. How will my pharmacy costs be covered?
    5. Can I leave the plan if I am unhappy?
    6. If I have a complaint, how will it be addressed?
  • All beneficiaries should be reassured that: (1) they are not in any danger of losing traditional Medicare coverage if they prefer to keep it; and (2) they can delay making any choice indefinitely, and will in the meanwhile continue to be covered by traditional Medicare.

Communications

Approximately 1,500 copies of both Improving the Medicare Market: Adding Choice and Protections and Developing an Information Infrastructure for the Medicare+Choice Program: Summary of a Workshop (based on the March 1998 event) were distributed to congressional offices, nonprofit agencies and private companies, including insurers and large employers. A report on the first symposium was published in the December 1996 issue of Health Affairs. Project staff also presented the IOM committee's recommendations to several congressional committees. (See the Bibliography for details.)

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AFTER THE GRANT

The project concluded with the close of the second grant, although other nonprofit organizations, including the National Academy of Social Insurance and the Heritage Institute, have followed up on many of the same themes. The Center for Medicare and Medicaid Services (formerly HCFA) plans to test market Medicare & You, a handbook that describes plan options, in five states.

Plans to conduct a national education campaign were postponed after focus group participants expressed confusion about the materials. In June 2001, as part of the reorganization of HCFA into Center for Medicare and Medicaid Services, the agency created the Center for Beneficiary Choices to focus on the Medicare+Choice program and to provide beneficiaries with information on choosing their health plans.

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GRANT DETAILS & CONTACT INFORMATION

Project

Public Accountability and Informed Purchasing in Medicare Managed Care - Symposium, Workshops, and a Report

Grantee

National Academy of Sciences - Institute of Medicine (Washington,  DC)

  • Symposium on Public Accountability and Informed Purchasing in Medicare Managed Care
    Amount: $ 224,380
    Dates: July 1995 to September 1997
    ID#:  027343

  • Workshops and a Publication on Public Accountability and Informed Purchasing in Medicare Managed Care
    Amount: $ 118,636
    Dates: April 1997 to January 1999
    ID#:  031002

Contact

Marion Ein Lewin
(202) 334-1506
mlewin@nas.edu

Web Site

http://www.nas.edu

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APPENDICES


Appendix 1

(Current as of the time of the grant; provided by the grantee organization; not verified by RWJF.)

Committee on Choice and Managed Care

Stanley B. Jones (co-chair)
George Washington University
Shepherdstown, W.Va.

Harry P. Cain II, Ph.D. (co-chair)
Blue Cross and Blue Shield Association
Chicago, Ill.

Geraldine Dallek (Grant ID# 027343 only)
Families USA
Washington, D.C.

Helen B. Darling
Xerox Corporation
Stamford, Conn.

Tom J. Elkin
Independent Health Care Consultant
Sacramento, Calif.

Allen Feezor
Pitt County Memorial Hospital
Greenville, N.C.

James P. Firman, Ed.D.
National Council on the Aging
Washington, D.C.

Sandra Harmon-Weiss, M.D.
U.S. Healthcare
Blue Bell, Pa.

Risa J. Lavizzo-Mourey, M.D.
University of Pennsylvania
Philadelphia, Pa.

Mark V. Pauly, Ph.D.
University of Pennsylvania
Philadelphia, Pa.

Shoshanna Sofaer, Dr.P.H. (Grant ID# 031002 only)
George Washington University Medical Center
Washington, D.C.

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BIBLIOGRAPHY

(Current as of date of this report; as provided by grantee organization; not verified by RWJF; items not available from RWJF.)

Books

Improving the Medicare Market: Adding Choice and Protections. Washington, D.C.: National Academy Press, 1996.

Articles

Lewin ME and Jones SB. "The Market Comes to Medicare: Adding Choice and Protections." Health Affairs, 15(4): 57–61, 1996.

Reports

Letter Report to the Administrator of the Health Care Financing Administration on Developing an Information Infrastructure for the Medicare+Choice Program. Washington, D.C.: National Academy Press, 1998.

Developing an Information Infrastructure for the Medicare+Choice Program: Summary of a Workshop. Washington, D.C.: National Academy Press, 1999. Also available online.

Sponsored Conferences

"Choice and Managed Care: Assuring Public Accountability and Informed Purchasing by and on Behalf of Medicare Beneficiaries," February 1–2, 1996, Washington, D.C. Attended by about 50 people from 40 organizations. Examples of organizations represented include the American Association of Health Plans, the Institute for Health Policy Solutions, Edison International, the National Academy of Social Insurance, the US Senate Special Committee on Aging, the Agency for Health Care Policy and Research, and the National Committee for Quality Assurance. Nine presentations.

Presentations

  • Lynn Etheredge, private consultant (Washington, D.C.), "Developing a Structure for Consumer Choice: Looking at the Continuum of Options for Assuring Public Accountability."
  • Elizabeth Hoy, Institute for Health Policy Solutions (Washington, D.C.), "The Content and Process of Informed Choice: Reviewing the State-of-the-Art from the Corporate Community and Other Purchasing Alliances." Responding perspectives: Kathleen P. Burek, Minnesota Department of Employee Relations (St. Paul, Minn.); Richard E. Curtis, Institute for Health Policy Solutions, (Washington, D.C.); Barbara Decker, Edison International, (Rosemead, Calif.).
  • Kathleen M. King, Health Care Financing Administration (Washington, D.C.), "Assuring Informed Choice and Public Accountability: A Report on Activities at HCFA."
  • Joyce Dubow, American Association of Retired Persons (Washington, D.C.), "Who is the Medicare Consumer: One Size Does Not Fit All, Special Issues for Vulnerable Populations." Responding perspectives: L. Gregory Pawlson, The George Washington University (Washington, D.C.); Peter Fox, PDF, Incorporated (Chevy Chase, Md.).
  • Susan Edgman-Levitan, Picker Institute for Patient-Centered Care (Boston, Mass.), "What Information Do Consumers Want and Need?"
  • Carol Cronin, Health Pages (Annapolis, Md.), "Communicating Information Effectively." Responding perspectives: Diane Archer, Medicare Beneficiary Defense Fund (New York, N.Y.); Priscilla Itscoitz, United Seniors Health Cooperative (Washington, D.C.); Marcia A. Laleman, Keystone Health Plan East (Philadelphia, Pa.).
  • Patricia A. Butler, Health Care Consultant (Boulder, Colo.), "Choice and Managed Care: Enrollee Satisfaction and Consumer Protections/The States' Role in Holding Plans Accountable." Responding perspectives: Dixon F. Larkin, State of Utah (Salt Lake City, Utah); Robert Berenson, Georgetown University School of Medicine (Washington, D.C.); Garry Carneal, American Association of Health Plans (Washington, D.C.).
  • Judy Moore, Independent Health Care Consultant (McLean, Va.), and Tom J. Elkin, Independent Health Care Consultant (Sacramento, Calif.), "Assuring Public Accountability and Informed Purchasing: Case Studies of Medicare and CalPERS."
  • David B. Kendall, Progressive Policy Institute (Washington, D.C.), "A Review of Relevant Provisions in Current Legislative Proposals."

"Developing an Information Infrastructure for the Medicare+Choice Program," March 4–5, 1998, Washington, D.C. Attended by 24 people from 17 organizations. Examples of organizations attending include: AARP, Library of Congress, Health Care Financing Administration, Health Policy Alternatives, Urban Institute, and American Association for Health Plans. Four keynote presentations and five panels.

Presentations

  • Lynn Etheredge, Consultant (Chevy Chase, Md.), "Setting the Stage: Critical Issues and Questions."
  • Michael McMullan, Health Care Financing Administration (Baltimore, Md.), "A Status Report from HCFA."
  • W. Doug Davidson, Foundation for Accountability (Portland, Ore.), "Additional Perspective."
  • Sara Singer, Stanford University (Palo Alto, Calif.), "Highlights of a Recent Report from the California Managed Health Care Improvement Task Force."

Panel

  • "Issues in Marketing to Medicare Beneficiaries," Frederick S. Adler, The Senior Network (Stamford, Conn.); Tom L. Anderson, United HealthCare (Edina, Minn.); Bruce Clark, Age Wave Health Services (Emeryville, Calif.); Martin Rosen, NYLCare (New York, N.Y.); Jack Tighe, Independence Blue Cross (Philadelphia, Pa.).
  • "Roles of the Public and Private Sectors, Information Brokers, and Potential Liability," Aileen Harper, Center for Health Care Rights (Los Angeles, Calif.); Judith Hibbard, University of Oregon (Eugene, Ore.); Gail Povar, Cameron Medical Group (Silver Spring, Md.); Robyn Stone, New York Academy of Medicine (New York, N.Y.).
  • "Best Practices and Potential Models for an Open Season Health Plan Enrollment Process," David G. DeVries, State of North Carolina Teachers' and State Employees' Comprehensive Major Medical Plan (Raleigh, N.C.); James W. Morrison, Morrison Associates (Washington, D.C.); Guy Peterson, General Electric (Schenectady, N.Y.).
  • "Special Needs Populations: Helping Those Most in Need of Help," Peter Fox, PDF, Inc. (Chevy Chase, Md.); Francesca Gany, New York Task Force on Immigrant Health (New York, N.Y.); Katie Maslow, Alzheimer's Association (Washington, D.C.).
  • "Getting from Here to There: Implementation and Unresolved Issues," Carol Cronin, Health Pages (New York, N.Y.); Helen B. Darling, Xerox Corporation (Stamford, Conn.); Lynn Etheredge, Consultant (Chevy Chase, Md.) and Vicky B. Gregg, Blue Cross and Blue Shield of Tennessee (Chattanooga, Tenn.).

Presentations and Testimony

Improving the Medicare Market: Adding Choice and Protections. Recommendations presented to the Older Americans' Caucus of the US House of Representatives and the Physician Payment Review Commission on September 19, 1996. At the request of committee staff.

Improving the Medicare Market: Adding Choice and Protections. Recommendations presented to the U.S. Senate Special Committee on the Aging on April 10, 1997. At the request of committee staff.

Improving the Medicare Market: Adding Choice and Protections. Recommendations presented to the U.S. House of Representatives Committee on Ways and Means, Subcommittee on Health, March 6, 1997. At the request of committee staff.

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Report prepared by: Susan G. Parker
Reviewed By: Richard Camer
Reviewed By: Karyn Feiden
Program Officer: Rosemary Gibson

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