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Medicare Managed Care

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  • The number of beneficiaries with drug coverage through Medicare managed care has risen to 17 percent. Most Medicare managed care plans offer prescription drugs. Drug coverage is one of the major attractions for beneficiaries to enroll in these plans.
  • Drug coverage under Medicare+Choice is unstable. Managed care plans are not required to offer a drug benefit, but can do so with any excess Medicare payments or by charging a premium. This results in wide variation across areas, since payments vary by area, and over time.

Value of Medicare Managed Care Drug Benefits is Declining: Bar Graph

    Limits on Medicare managed Care Drug Benefit Are Getting Lower: Bar Graph

  • The value of Medicare managed care drug benefits is declining. Nearly three-fifths of plans are reporting that they will cap prescription drug benefits below $1,000 in the year 2000. The proportion of plans with $500 or lower benefit caps will increase by over 50 percent between 1998 and 2000. This is part of a troubling trend of plans to severely limit benefits through low caps.
  • Plans dropping out of Medicare limit access to drugs. Nearly 80,000 Medicare beneficiaries will lose access to Medicare managed care next year as plans withdraw from particular areas or Medicare altogether.

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