6 HMOs stay in Md. Medicaid but decry rates

Health organizations say they may have to limit participation in future

October 03, 2001|By M. William Salganik | M. William Salganik,SUN STAFF

All six HMOs in the state Medicaid program have told officials they will continue to participate, but several HMOs indicated that concerns over the rates the state pays could lead them to limit their roles in the future.

"The good news is that, at least for now, everybody's in," Deputy Health Secretary Debbie I. Chang said yesterday.

As recently as last week, the HMOs indicated they were uncertain whether, or how much, they would continue to participate in the program, which provides health coverage for more than 420,000 people -- mothers on welfare and their children, moderate-income children and the disabled. Maryland switched all Medicaid recipients to managed care in 1997.

In a letter urging Gov. Parris N. Glendening to consider increasing rates, two key legislative committee chairmen said that if the HMOs (also known as managed care organizations, or MCOs) freeze enrollment or pull out of some counties, "The effect of these potential decisions would represent a complete failure of our efforts to create a managed-care model for treatment."

Montgomery County Democrat John A. Hurson of the House Environmental Matters Committee and Thomas L. Bromwell of the Senate Finance Committee, a Baltimore County Democrat, sent the letter Friday.

Michael Morrill, Glendening's communications director, said yesterday that the rates the state plans to pay in January represent "an extraordinary increase and an extraordinarily fair rate."

Of the complaints that rates are inadequate, Morrill said, "We hear this every year. Every year, the MCOs try to negotiate rates that will give them the highest profit possible."

While some legislators want to increase spending, he said, others want to reduce it.

Because HMOs can drop counties or freeze enrollment with notice to the state, Hurson said yesterday, "they still have some leverage" in trying to increase rates.

The HMOs indicated continued concern about the rates they receive. Mark Puente, associate vice president for Americaid, one of the HMOs, said yesterday that while the state projects an increase of 8.3 percent in health costs, Americaid will receive an increase of less than 5 percent from the state.

"We sent the department notice that we are still committed to the program, and we will maintain our existing service areas," Puente said. "But we will monitor expenditures and revenue on a monthly basis."

Eric R. Wagner, president of Helix Family Choice, said his HMO, which operates in Baltimore and Baltimore and Harford counties, would continue to serve its members, but, "We will be frozen if the rates don't change."

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