Intergroup of Arizona announced Thursday that it is pulling its Medicare+Choice plan, which provides prescription drug coverage and other health benefits for thousands of seniors, from Gila, Cochise and South Pinal counties by the end of this year.
The decision affects 2,600 seniors in Gila County and 7,800 seniors throughout the three counties.
May Gilligan, Intergroup of Arizona's president and chief executive officer, said the cutback decision was "extremely difficult" but necessary due to inadequate government reimbursements.
"Because of certain consequences of revised Medicare funding under the Balanced Budget Act of 1997 and the economic realities present in these counties," he said, "we ultimately had no choice."
For every $100 of revenue in Gila County that is paid to Intergroup, he said, $110 is paid out to cover health care costs. For every $100 of revenue in Cochise County, $113 is shelled out for medical coverage.
"We sustained losses in these counties and we have no evidence that the rate of increase in reimbursement from the federal government for Medicare HMOs will match the rate of increase in healthcare costs for seniors in these counties," Gilligan said.
Medicare beneficiaries who are enrolled in the HMO's Medicare+Choice, Senior/CoCare plan will not lose health insurance coverage, but they must find another HMO, switch to Intergroup's original Medicare plan or submit medical bills directly to Medicare, losing the extra benefits many HMOs offer.
Switching HMOs may mean having to switch doctors, and reverting to Intergroup's original Medicare plan will result in the loss of some benefits.
Intergroup will continue to offer its Medicare+Choice, Senior/CoCare plan in 2001 to more than 52,000 Arizona seniors in Maricopa, Pima and Santa Cruz counties as well as the city of Apache Junction in Pinal County.
"We are currently contacting all of our senior members who are affected by these decisions to ensure a smooth transition to another Medicare+Choice plan or Medicare supplement plan or the traditional Medicare program," Gilligan said. "Our main goal over the course of the next few months is to work closely with these seniors to inform them of their health care options for 2001."
Seniors who are currently enrolled in Intergroup's SeniorCare/CoCare plans in the counties Intergroup is leaving have the option to switch to other health plans that offer Medicare+Choice products or revert to the original Medicare program before the end of 2000 if they are eligible for Medicare.
For more information, call Sally Fernandez at (520) 529-8296.