Byline: Dana Bartholomew Staff Writer
For 82-year-old Queenie Serot, life's great pleasure is treating each of her seven grandchildren to dinner and a show.
But if a $20-a-month HMO-Medicare premium proposed by Kaiser Permanente is approved this week by Uncle Sam, Serot said she might not be able to share the next Disney spectacular with her offspring.
``I have a fixed income,'' said the retired school teacher from Woodland Hills, who can amble about thanks to a pacemaker and walker supplied by Kaiser. ``It would be difficult.''
The increase, she said, is ``not acceptable.''
Serot is one of almost 554,000 Kaiser beneficiaries in California likely to be hit in 2001 with new or higher Medicare premiums. For Los Angeles, the $20 Kaiser premium is new - a result, company and industry officials say, of medical costs failing to keep pace with government Medicare reimbursement rates.
Though other counties will probably fare worse, the likely increase for Kaiser beneficiaries in Los Angeles already worries some seniors. The federal Health Care Financing Administration, which administers Medicare, is scheduled to announce the new rates Friday.
The Center for Health Care Rights, a health insurance counseling program in Los Angeles, reports numerous calls from concerned seniors.
``The primary concern is the $20 premium is unfair,'' said Aileen Harper, executive director for the Department of Aging program. ``because last year Kaiser increased its office visit copayment and pharmaceuticals copayment.
``I think people feel it's a double whammy,'' she said. ``These costs are striking for low-income seniors on fixed incomes who are not eligible for Medicaid.''
The myth is that Medicare pays for health care, said Clare Smith, executive director of California Health Care Advocates. ``Time and again, it shows it barely covers half'' when such big-ticket expenditures as long- term care are included.
Many Kaiser beneficiaries, however, said they can absorb the $240 a year.
Compared to the regular Medicare fee-for-service plan, which doesn't pay for costly drugs or confer other benefits, the choice to enroll in a health maintenance organization plan is inexpensive.
``I think Kaiser is a pretty good bargain,'' said George Honorof, 89, of Sherman Oaks, who like Serot was in line to receive care from the Kaiser Permanente Woodland Hills Medical Center on Friday.
``I've been with Kaiser and I've saved money in contrast with private physicians.''
Rising costs cited
Kaiser officials were apologetic enough about the proposed increase to notify an undisclosed number of Los Angeles beneficiaries by letter last July.
``We're in for the long haul,'' said Kaiser spokeswoman Lisa Kort, ``but unfortunately, we're seeing a rise in costs.
``The rate of (federal Medicare) reimbursement increases at a rate slower than the cost of health care, hospital utilization, pharmacy costs, new technology and recruiting and obtaining specialized doctors.''
Other insurance providers and analysts agree. But compared to HMO- Medicare increases for Northern California and other states, Los Angeles and Orange county (also at $20) are faring well.
Managed care markets in those regions are mature, with 10 HMO insurance providers and a medical infrastructure with hundreds of hospitals and thousands of doctors.
Such competition, along with the highest per patient Medicare reimbursement rate in the state - at $661 per patient per year, compared with Fresno's $438 - have kept patient costs down, analysts say.
``Los Angeles will fare the best,'' said Jack Christy, director of the California Medicare Project, a research arm of the California Health Foundation. Elsewhere, he added, ``there's going to be a lot of pain out there.''
In most counties outside Los Angeles, Medicare managed care plans will begin charging a hospital deductible of $100 per visit, with some imposing new limits on total drug purchases, he said.
Kaiser, which commands 34 percent of the Medicare managed care market in California, has proposed $30 premiums for Ventura, Riverside, San Bernardino and San Diego counties. Beneficiaries in Northern California counties may pay up to $50 a month.
A call to action
PacifiCare, the country's largest HMO, whose Secure Horizons plan covers about 200,000 seniors in Los Angeles, has proposed higher premiums as well - but not in the Los Angeles market, company officials say.
``It doesn't warrant a premium, not in our eyes yet,'' said PacifiCare Senior Vice President Kathy Feeny, who said premiums have cost PacifiCare market share. Instead, the company has proposed a minor increase in generic drug costs for Los Angeles.
This year, medical costs have risen 6 percent; drug costs 23 percent, while Uncle Sam has upped reimbursements only 2 percent. What's needed for Medicare, she said, is a massive infusion of federal dollars.
``There's a call to action here, and it's loud and clear,'' Feeny said. ``More money needs to be put into the system - and the federal government needs to hear that.''
Health Care Financing Administration officials could not be reached for comment Friday.
Help may - or may not - be on its way.
Insurance companies have called for an additional $70 billion a year for Medicare. Senate Republicans are pushing legislation that would offer up to $31 billion for temporary, immediate Medicare prescription drug assistance for lower-income senior citizens. Other pending bills call for less.
``Assuming that things stay the same - and there is no legislative intervention - the plans in Los Angeles are going to see continual increases,'' said Cecilia Echeverria, senior policy analyst for the California Medicare Project.
``If things stay the same, beneficiaries (in Los Angeles) will begin to see premiums just like the other counties'' across the state.
For more information about Medicare rate increases, call the Center for Health Care Rights at (800) 824-0780.
