The NPR/Kaiser Family Foundation/Kennedy School of Government National Survey on Americans and Dietary Supplements was designed by staff at National Public Radio, Kaiser Family Foundation, and the Kennedy School of Government and conducted by Princeton Survey Research Associates. The survey was conduced bytelephone with 1,200 adults (age 18 or older) nationwide between February 19 andFebruary 25, 1999. The margin of sampling error is plus or minus 3 percentagepoints.

• Toplines/Survey

A Financial Overview of the Managed Care Industry

March 1999

Part 2

Recent HMO Activity

After 6 years of steady growth, HMO profits declined in 1994, 1995, and 1996; in 1997, nearly 60 percent of HMOs lost money (Weiss Ratings). Although HMO net income plunged from 1994 through 1997, HMO enroll-ments were up 72% and total revenues rose 77% over that period (Best’s Aggregates & Averages HMO, 1998). At the same time, health services companies have grown increasingly profitable throughout the 1990s.

While underlying health care costs have continued to grow especially for prescription drugs plans competing for market share have until recently sought to hold premium levels down. HMO premium increases moderated through-out the early 1990s, and the rates charged to large employersactually declined by 0.4% in 1996. Since then, premiums charged to large firms have increased 2.0% in 1997 and 2.9% in 1998 (KPMG Peat Marwick). Most analysts now expect premiums to escalate, with one study predict-ing increases of 6-9% in 1999 (Hewitt Associates).

In part due to recent premium increases, some plans including PacifiCare, Wellpoint, and United HealthCare are now reporting positive balance sheets. However, other plans are continuing to report significant losses. For example, Kaiser Permanente, one of the nation’s largest andmost visible HMOs, lost $288 million in 1998 (or 2.8 percent of operating revenues), on top of a loss of $266 million in 1997 (3.2 percent of operating revenues). Kaiser attributes 1998 losses to increases in the cost of care from pharmacy and hospital services, and the use of non-Kaiser Permanente health facilities.

Responding in large part to financial pressures and to pay-ment reforms in the Balanced Budget Act of 1997, plans have pulled back from some markets, especially in theMedicare program. For 1999, nearly 100 HMOs either reduced their service areas or terminated their contracts with Medicare, affecting more than 400,000 beneficiaries (nearly 7% of Medicare HMO enrollees). The reasons cited by HMOs for the withdrawals were the inadequacyof Medicare s payment rates and the regulatory burden of participating in Medicare, including increased require-ments for consumer protections.

Mergers and acquisitions have beenanother feature of HMO activity in recent years. The proportion ofHMO enrollees in the 10 largest national managed care firms oneindicator of market concentration has grown rapidly recently afterremaining steady at about 55% for a number of years,rising to 67% in January 1998 (InterStudy). Major mergers in theindustry include Aetna’s purchase of U.S. Healthcare in 1996 andCIGNA’s acquisition of Healthsource in 1997. More recently, Aetnaannounced that it will buy Prudential for $1 billion. This deal has beencriticized by such organizations as the American Medical Association and is under review by fed-eraland state regulatory agencies. Mergers may put a strain on an HMO s financial results, in part because of the difficulties of integrating the businesses acquired. Concerns have also been raised about the resulting domi-nation of a small number of HMOs in certain geographic markets, the impact on providers ability to negotiate pay-ment rates and resulting impact on treat-ment time and options, and patient fears that provider networks will be disrupted. At the same time, mergers can lower coststhrough economies of scale and increased purchasing leverage by plans.

Issues

Do recent stock price declines signal a shift in prospects for the managed care industry?Many investors were drawn to managed care companies asgrowth stocks that would achieve success by meeting therapidly growing demand for lower-cost managed care prod-ucts,as well as the potential to increase efficiency. Now,over three-quarters of those with employment-based healthinsurance are enrolled in some type of managed care plan,so potential further growth in that segment of the market islimited. Overall, enrollment growth has been especially visi-blein open-access products, but there are uncertaintiesregarding the ability of these plans to control costs.

How will rising premiums affect insurance coverage?While premium increases may help to restore the finan-cial health of HMOs, such increasesalso impact the cost of health carefor employers and enrollees. Smallbusinesses (who are least likely tooffer coverage) and lower incomeindividuals (who are most likely tobe uninsured) are particularly vul-nerableto cost increases. The num-berof uninsured has continued inrecent years to rise by more than onemillion a year, even in a period ofunprecedented economic prosperityand moderate growth in healthinsurance premiums. Rising premi-umscan only increase the already large number of peopleuninsured.

Would the passage of consumer protection legislationaffect the financial viability of HMOs? Consumerprotection legislation has been introduced in Congressand in many states. What would be the impact of provi-sionssuch as mandating external reviewprograms, prudent layperson paymentrequirements for emergency care, andhealth plan liability? Some estimatessuggest that the cost of these and otherprovisions could be large,but independent analyses by theCongressional Budget Office andCoopers & Lybrand (prepared for theKaiser Family Foundation) point to amore modest cost impact.

What is the future of HMOs in Medicare? Despite planwithdrawals for 1999, HMOs are expected to cover anincreasing proportion of beneficiaries. With future pres-sureto lower federal payments to plans, will HMOs con-tinueto find this market attractive and provide expandedbenefits such as prescription drugs?

How do market pressures affect quality of care? It is notclear whether profit status matters in the quality of care thatis delivered, or whether, in the near future, we will havereliable measures to judge quality across not-for-profit andfor-profit organizations. Market incentives have been bothcredited for eliminating unnecessary care and blamed forforcing providers to skimp on quality and quantity of care.

The Kaiser Family Foundation, based in Menlo Park, California, is a nonprofit, independent national health care philanthropy and is not associated with Kaiser Permanente or Kaiser Industries.

For more information,visit the Foundation sweb site at www.kff.orgor call the publicationrequest line at(800) 656-4533.

This Fact Sheet is also available in PDF format. Return to top

A Financial Overview of the Managed Care IndustryFact Sheet Part 1 Fact Sheet Part 2

A fact sheet on the growing influence of for-profit organizations; trends in the stock prices of HMOs and health services companies compared to the overall stock market; recent HMO activity such as premium increases and mergers and acquisitions; and issues related to the financial aspects of HMOs.

• Fact Sheet
• Fact Sheet

A Financial Overview of the Managed Care Industry

March 1999

Part 1

The rapid growth of managed care has brought with it a growing connection between the stock market andhealth care organizations. Health care services have evolved from being delivered by physicians and tax-exempt institutions to a market-driven industry attracting investment capital from numerous sources. The market capitalization, or total stock value, of the relatively young HMO industry grew from a little over $3 billion in 1987 to almost $39 billion in 1997 an almost twelve-fold increase while the stock mar-ket as a whole grew about four-fold to a total of $10.5 trillion. However, recent health plan earnings and premium announcements indicating companies difficulties in managing medical costs have led some equity analysts and investors to question whether these health sector stocks will offer growth potential in the future. And, financial difficulties in the HMO industry may have important implications for health policy debates that are increasingly connected to the practices and potential of private health plans.

The Growing Influence of For-Profit Organizations

The increased corporate influence in health care is espe-cially evident in the growing prevalence of for-profit companies within the HMO sector. Between 1981 and January 1998, for-profit HMOs grew from representing 12% to 63% of total HMO enrollees, and from 18% to 74% of plans (InterStudy). Among hospitals, on the other hand, for-profit companies have increased their role, but nonprofit organizations continue to dominate the industry. Between 1980 and 1996, for-profit companiesgrew from representing 9% to 13% of community hospi-tal beds (American Hospital Association).

The growing role of for-profit companies in the HMO and hospital sectors has resulted from a combination of the emergence and growth of for-profit companies, as well as conversion of not-for-profit companies to for-profit status. One outcome of these conversions is the estab-lishmentof charitable foundations designed to preserve the charitable missions and assets of the formerly not-for-profit organizations. As of February 1999, there were at least 109 conversion foundations in the U.S., with assets totaling about $13 billion. Health plan con-versions represented the source of only 11 of the founda-tions, but these foundations hold almost half of the total assets (Grantmakers in Health).

Stock Trends

Many for-profit health care compa-nies have tapped the stock marketfor financing. According to an analysis prepared for the KaiserFamily Foundation by Securities Data Company, there were 233 ini-tialpublic offerings (IPOs) of stock of health companies between 1987 and 1997.

The total stock value (or market cap-italization) of publicly traded healthservices and HMO companies has increased dramatically over the pastdecade. Total market capitalization of HMOs grew from $3.3 billion inJanuary 1987 to $38.9 billion as of the end of November 1997, an almost twelve-foldincrease. For companies classifying themselves as health services (including hospitals and nursing homes), capital-ization grew from $16.3 billion to $112.7 billion over thesame time frame. In comparison, the overall stock market grew a little over four-fold during this time period. Wall Street’s growing interest and role in health care companiesis also evidenced by the increased number of investment analysts following health care stocks from 152 in 1987 to 559 in 1997, according to Nelson’s Directory of Investment Research.

Over the last decade, HMO stocks generally out-per-formed the market as a whole, although they experienced periods of significant price declines, most recently betweenJuly and September 1998. In contrast, health services companies tracked just somewhat above the marketthrough much of the decade until 1998, when health ser-vices fell below the market. Recently, average annual returns for health services and HMO companies have suf-fered relative to the overall market. Using a University of Chicago index developed for the Kaiser Family Foundationthat measures the market-weighted return of stocks, a 1987 investment of $100 in the market as a whole would have grown to $610 by the end of 1998. In comparison, an investment of $100 in HMOs would have grown to $807, while a similar investment in helath services compa-nies would have increased to only $393. In 1998, HMOs performed a bit better than in the previous couple of years with average stock prices rising 7% over the course of the year compared to a drop of 11% from 1995 to 1997 but health services companies did quite a bit worse in 1998 and saw stock values fall by 19%. Many anticipate that slow recovery will continue for HMOs in 1999, but not to historic levels of stock price growth.

Part 2

This Fact Sheet is also available in PDF format.Return to top

A Financial Overview of the Managed Care IndustryFact Sheet Part 1 Fact Sheet Part 2

A new survey of parents and kids ages 10-15 on topics such as sex, AIDS, violence, alcohol and drugs. The survey was conducted for the Kaiser Family Foundation and ChildrenNow, as part of a national initiative called Talking With Kids About Tough Issues. More information on the campaign is available at www.talkingwithkids.org.

This parent guide offers practical, concrete tips and techniques for talking easily and openly with young children ages 8 to 12 about tough issues:sex, HIV/AIDS, violence, drugs and alcohol.

• Talk With Your Kids…before everyone else does.

This report provides a comprehensive description of the Federal Employees Health Benefits Program (FEHBP) and compares the FEHBP and Medicare programs as they are currently structured. It reviews evidence on the performance of FEHBP and examines the implications of restructuring Medicare to conform to a FEHBP-based plan. Overall, the report suggests that FEHBP offers some promise as an approach for reforming Medicare, but important issues would have to be addressed to adapt the model to Medicare.

Medicare Restructuring: The FEHBP Model

Executive Summary

Part 2

How Well Does FEHBP work?

FEHBP has been somewhat more successful than Medicare in controlling costs. However, recent trends indicate that FEHBP’s competitive structure alone cannot guarantee cost control over the long term.

Until recently, FEHBP experienced slightly lower growth in spending per enrollee than Medicare. Over the period 1987 to 1997, Medicare spending per beneficiary grew at an annual rate of 8.1 percent. FEHBP spending per enrollee grew at 7.1 percent a year over the same period, and at much lower rates in the mid-1990s. In the last two years, FEHBP premiums have increased sharply, by 8.5 percent in 1998 and 10.2 percent in 1999. (At the same time, growth in Medicare per capita spending slowed to almost zero in 1998, and may actually decline in 1999.)

The experience under FEHBP thus parallels that recently reported for private employers, sizable premium increases after a brief period of rate stability. Various causes have been suggested for these increases in the private sector, including the growth of less tightly structured managed care plans or an inability on the part of such plans to control the use of new pharmaceuticals and other medical technologies. An additional factor that may have affected spending growth under FEHBP is that, during the early 1990s, there was a significant shift from the employee organization fee-for-service plans to HMOs. This trend ended by 1995. While enrollment in the employee organization plans has continued to drop, the enrollees have been moving to Blue Cross/Blue Shield rather than to HMOs.

Whatever the reason for the recent increases, it is clear that FEHBP’s favorable experience in the mid-1990s is not necessarily an indicator of its likely success in controlling costs in the future. Nothing in the FEHBP structure guarantees control over costs in the long term. While FEHBP might be described as a “premium support” system, it is not a defined contribution program. There is no budgetary limit on the growth in government contributions to FEHBP plans; instead these contributions are tied to the rates established for different plans and the choices made by participants. OPM has some degree of flexibility in negotiating benefits and rates with the plans, but it does so under political constraints.

For example, OPM did not respond to the prospect of an 11.6 percent increase in Blue Cross/Blue Shield rates for 1999 by requiring a significant reduction in benefits. If OPM had sought to restrain growth to, say, 5 percent, the necessary benefit changes would presumably have led to an outcry from employees, unions, and retiree groups. It is likely that HCFA (or any alternative administrative entity) would face even greater resistance if it attempted to meet a vague goal of fiscal restraint by negotiating benefit reductions: benefit changes would affect not only millions of beneficiaries but a health care industry heavily dependent on Medicare payment. As a result, substantive benefit changes would probably continue to be made through the political process.

The FEHBP program is heavily affected by biased selection, the concentration of more costly enrollees in certain plans. This has distorted price competition and penalized higher-risk enrollees, and may have increased government costs.

The 1998 biweekly premiums charged by FEHBP plans to single enrollees range from $41 to $174, a difference of 321 percent. Part of this variation is geographic: the lowest-cost plan is a local HMO in Florida, the highest cost plan a national employee association plan. Even within a geographic area, however, rates vary enormously: in the Washington, D.C. area, the most costly plan charged 2.6 times as much as the least costly. This difference is not related to the benefits offered by the plans-on the contrary, the least generous plans have the highest premiums. Instead, FEHBP premiums appear to be determined largely by the characteristics of the populations they enroll, rather than by their benefits, reimbursement rates, or efficiency in delivering services. Older and sicker participants are heavily concentrated in certain plans. These plans must charge more than the plans with lower-risk enrollees, and the excess cost is passed on directly to the participants.

Why is selection a problem? First, the government may be overpaying the HMOs. The HMO premiums are based on their charges to commercial enrollees and are not necessarily adjusted for characteristics of the FEHBP participants. If the plans are enrolling healthier FEHBP participants, they-or their capitated subcontractors-may be profiting disproportionately from the FEHBP group. This is especially likely because other participating employers may no longer offer a choice of HMO and fee-for-service options, a practice which has long been thought to encourage favorable selection in HMOs. If other groups are now more heterogeneous, including both healthy and sick enrollees, their rates may be inappropriately high for an FEHBP group biased toward healthier enrollees.

Second, and more important, the price differences that FEHBP enrollees see when they are selecting a plan may not reflect differences in benefits, quality, or efficiency-the factors on which plans should ideally be competing. Instead, some plans appear more costly than others because of the populations they have attracted.

Would an FEHBP-Like System Be Better for Medicare?

Proponents of an FEHBP-like system contend that it would make beneficiaries more sensitive to the costs of the different health plan options available to them. would induce them to choose more efficient plans, and would thus reduce the rate of growth in Medicare spending.

Under the current Medicare+CHOICE system, the government pays the full cost for original Medicare; for enrollees in competing health plans the government contributes an amount roughly equal to the cost of original Medicare for comparable beneficiaries. Beneficiaries who choose original Medicare pay the part B premium. Those who choose less costly plans may receive some free or low-cost supplemental benefits, but never pay less than they would for original Medicare; they still pay at least the part B premium.

Under an FEHBP model, the government contribution would be based on the average price of competing plans, including original Medicare. Enrollees who choose less costly plans would share in the savings. Depending on how the program was structured, this could mean that enrollees who remained in original Medicare would pay more than they do now, while enrollees who shifted to less costly plans would pay less.

Potential for Savings

Would adoption of a premium support program actually save money for Medicare over the long term? There is no way of knowing. The real-life models for such a program-including FEHBP and the California Public Employees’ Retirement System (CalPERS)-appeared successful in controlling spending growth earlier in this decade. But per capita spending under these systems is now rising more rapidly than under Medicare.

Competition in itself can produce savings for Medicare only if competing plans can really operate more efficiently than original Medicare does, and only if a representative cross-section of the Medicare population chooses to enroll in those plans. It is by no means certain that private plans can actually provide benefits equivalent to Medicare’s to a comparable population at lower cost.

Original Medicare is a more or less uncontrolled fee-for-service program, and it is likely that improved care management could produce some savings. But managed care plans often achieve much of their savings from provider discounts. Original Medicare already obtains steep discounts from providers. For hospitals, for example, Medicare paid 2 percent above cost in 1996, compared to 21 percent for private payers. In addition, original Medicare’s administrative costs are well below those of any private health plan, because of economies of scale, the absence of certain expenses such as marketing, and the lack of any need to build reserves or show a profit.

This does not mean that measures to promote greater competition under Medicare should not be considered, but only that there is no empirical basis for supposing that these measures will guarantee any particular level of savings. The only way to assure savings under a competitive structure would be for the government to arbitrarily limit growth in its contributions–as FEHBP has not done-leaving beneficiaries at risk of steadily eroding benefits or rising costs.

The Risk Selection Problem

Under both Medicare and FEHBP, there are concerns that competition is based largely on the plans’ ability to attract lower-cost participants, rather than on their relative efficiency. As noted earlier, there is evidence that, under FEHBP, the fee-for-service plans charge higher rates than the HMOs because they have enrolled higher-risk participants. A similar selection problem has occurred under Medicare: most available evidence suggests that sicker beneficiaries have remained in original Medicare and healthier ones have shifted to competing plans.

Under the current payment system, biased selection has raised costs to the government. HMOs have been overpaid, while average fee-for-service costs have grown because the sickest beneficiaries have remained in original Medicare. Under an FEHBP-like system, enrollees in original Medicare (or any other plan with a higher-risk population) would pay the entire excess cost resulting from selection. To avoid this result, the program would need to provide for adequate risk adjustment: steps to correct government contributions and enrollee shares so that high-risk beneficiaries and the plans that enroll them are not penalized. (Medicare has announced an adjustment method to be used beginning in 2000; the proposal has been heavily criticized by health plans.)

Unfortunately, despite recent advances in the measurement of risk, no available system can accurately predict the level of risk presented by a plans’ enrollees. The best available measures at this time overestimate costs for low-risk beneficiaries and underestimate costs for high-risk ones. If high-risk beneficiaries are concentrated in certain plans (such as original Medicare), they will pay inappropriately high premiums because the level of risk assumed by those plans has been understated. This could lead over time to a selection spiral, a steadily widening gap between the apparent prices to enrollees of favorably and adversely selected plans. Moreover, there would be no incentive for a plan to provide high-quality care to the chronically ill or other vulnerable beneficiaries; a plan that did so would merely attract more of these beneficiaries.

Unless this problem can be addressed, the effect of an FEHBP-like system would be to achieve budget savings by shifting the costs of care to beneficiaries, rather than by improving efficiency.

Design Issues for an FEHBP-Like System

If Medicare were to adopt the FEHBP model, the system might work roughly as follows:

1. Medicare would make available a single national fee-for-service plan. The plan would establish a premium sufficient to cover its anticipated costs.2. Other plans, including alternate fee-for-service or PPO plans (like the FEHBP employee organizations) and HMO plans could participate if they met minimum standards. Each of these plans would offer its own benefit package and set its own premium.3. The maximum government contribution would be a fixed percentage of the average premium for participating plans, weighted by enrollment.

This framework leaves open many important design questions. The following is a brief summary of some of the key issues; a fuller discussion is provided in the report.

Should the premium for original Medicare be established locally or nationally? Local variations in medical spending stem in part from real differences in operating cost and in part from unexplained differences in medical practice patterns. To encourage greater uniformity, some have suggested that a national price for original Medicare be established, with adjustments only for local input prices. However, because HMOs and other private plans do not operate nationally, they will inevitably quote local prices. A system that, like FEHBP, allowed competition between nationally and locally priced plans would distort price comparisons and could make beneficiaries in low-cost areas cross-subsidize those in high-cost areas.

Should plans be able to offer benefits less comprehensive than those of original Medicare? A system whose goal was to accommodate consumer preferences might allow beneficiaries who do not feel that they need all the benefits of original Medicare to select a less comprehensive plan. However, if plans are allowed to underbid Medicare by offering less generous benefits, lower-income beneficiaries would face financial pressure to accept substandard coverage. In addition there would be a greater likelihood of biased selection, with the less generous plans attracting the healthiest beneficiaries. If government contributions were based, as under FEHBP, on weighted average premiums for participating plans, the shift of beneficiaries to sub-Medicare options would reduce the contribution, further pressing lower-income beneficiaries to shift. The result could be a sort of race to the bottom, which might stabilize at a level well below current benefits.

To what extent should supplemental benefits be standardized? Unlimited benefit variation would allow consumers to select a plan that is tailored to their needs. At the same time, such variation can make value comparisons difficult for beneficiaries and may promote biased selection. (Similar concerns would arise if plans could substitute some “equivalent” benefits for the basic package.) Plans might be required to offer only one or more defined supplemental packages from a limited menu of possible packages, as is the case for Medigap coverage. Or they might be required to standardize individual benefits rather than entire packages; for example, a plan might or might not include prescription drug coverage, but a plan that included such coverage would have to provide a defined benefit. A third option would be to define a set of permissible supplemental packages and require every carrier to offer every authorized package. There might then be self-selection of enrollees in each type of package, but each carrier would be equally likely to attract enrollees interested in particular benefits.

Should plans be allowed to set a premium lower than the premium for original Medicare? Even if all plans were required to cover the minimum Medicare benefits, some might be more efficient than fee-for-service Medicare. Should they be allowed to share savings with beneficiaries in the form of money– instead of, as now, in the form of supplemental benefits? This approach would obviously lead larger numbers of lower-income beneficiaries to prefer HMOs to Medicare. However, this already occurs under the current system, because the HMOs offer supplemental benefits at a lower cost than Medigap plans do. The existence of plans with a price below that for original Medicare would, again, gradually affect the government contribution if this contribution were set under an FEHBP-like average-price system. However, this is the entire point of considering a premium competition system. If all plans are priced at or above the cost of original Medicare, the government can achieve savings only if it arbitrarily sets its contribution percentage somewhere below the current level. If some plans are allowed to offer lower prices for the same coverage, the government could gradually share in the savings resulting from beneficiary choices. As was suggested earlier, the critical question is whether risk measures are sufficient to assure that these savings do not simply amount to a cost-shift to sicker beneficiaries.

Should the plan premium quotations used in developing the government contribution reflect the cost of providing the minimum benefit package, with supplements priced separately, or should they reflect the cost of the plan’s total benefit package? Under FEHBP, a plan with more generous benefits will quote a higher price than one with less generous benefits. There are several reasons for requiring instead that plans quote prices for the core benefits. First, if the aim of adopting a competitive system is to restrain the growth in Medicare spending, the government presumably does not want its contribution to increase if beneficiaries choose plans with more generous benefits. Second, the requirement would facilitate risk adjustment: if one wishes to index in some way the overall risk presented by different individuals, that index must reflect their likely costs for a uniform package of services.

What is the aim of a risk adjustment system? Even assuming that satisfactory measures of risk can be developed, how these measures are actually used in the payment system will determine whether real competition occurs. Beneficiaries who choose less efficient plans or ones with more “amenities” should pay the excess cost themselves, but beneficiaries should not be penalized because a given plan has attracted sicker enrollees. The focus of the system must therefore be on correcting the prices that enrollees confront when choosing among plans: the price differences among plans visible to beneficiaries should be related to efficiency and not to characteristics of plans’ enrollees. At the same time, the system must neither increase government costs nor deprive any plan of the revenue it requires to operate. Risk adjustment is about fairly allocating premium costs between the government and beneficiaries, not about putting “inefficient” plans out of business.

What should be done about areas in which a competitive approach may not be feasible? In rural or other low-cost areas, private plans may not be able to offer coverage at a cost lower than original Medicare. In order to encourage development of competing plans, Medicare now deliberately overpays private plans in areas with low fee-for-service costs. Over the long term, however, this strategy is fundamentally incompatible with a competitive purchasing policy. Probably there are areas in which it will never be practical or fair to adopt a full competitive model, and the current system will need to be retained more or less unchanged. Criteria may need to be developed for identifying these areas; this will obviously be a difficult technical-and political-problem.

Protections for low-income beneficiaries must be designed, not just to assure that they will retain minimal access to care, but also to limit the likely evolution of a two-tiered care system. Under current law, Medicare premiums for many low-income beneficiaries are paid by Medicaid; many beneficiaries also receive assistance with cost-sharing and supplemental benefits such as prescription drugs. To provide equivalent protection under an FEHBP-like system, subsidies would have to be sufficient to assure that Medicaid-eligible beneficiaries would have some plan available at no cost. This will mean higher subsidies where low-cost plans have limited capacity or are inaccessible to low-income beneficiaries. Even if every beneficiary can join at least some plan, there are quality concerns if low-income beneficiaries-including both those now eligible for Medicaid and the near-poor-do not have a real choice of plans, or if some plans are so costly that they enroll only higher-income participants. Possible solutions include: requiring every plan to accept some beneficiaries at the subsidized price, limiting the maximum price variation of plans, or setting subsidies at a level sufficient to assure that multiple plans in each area are available at no cost. (Consideration should also be given to assisting modest-income individuals above the current Medicaid limits.)

Conclusions

Adoption of an FEHBP-like model for Medicare would require solutions to formidable policy and technical questions that FEHBP itself has never addressed. Some of these have already been discussed: risk adjustment of premiums and government contributions, managing the competition of national and local plans in local markets, and protecting low-income beneficiaries.

Even if all these issues can be resolved, there is no certainty that adoption of an FEHBP-like approach would necessarily save money over the long term. The price increases under FEHBP in the last two years, and similar experiences under other competitive models such as CalPERS, ¹ suggest that the competitive approach is not a formula for meeting a particular budget target. The only way to guarantee savings under a competitive structure would be for the government to arbitrarily limit growth in its contributions–as FEHBP has not done-leaving beneficiaries at risk of steadily eroding benefits or rising costs.

As the nation considers improvements in Medicare, there will undoubtedly be lessons to be learned from FEHBP, as well as from other public and private efforts to develop competitive systems. But Medicare is unique, in the huge and highly vulnerable population it serves and in its impact on the national health care system. There can be no single off-the-shelf model for Medicare restructuring. Instead FEHBP should be regarded as one of many models-successful in some respects, unsuccessful in others-from which policymakers may draw as they work to assure that promise of Medicare is kept for future generations.

The full report is available in PDF.

Additional free copies of this summary (#1462) and the full report on which it is based (#1461) are also available by calling our publications request line at 800-656-4533.

¹Average CalPERS premium increases for 1999 are 7.3 percent. “Employees Facing Steep Increases in Health Costs,” New York Times, Nov. 27, 1998, p. 1 and 26. Return to top

Medicare Restructuring: The FEHBP ModelSummary Part 1 Summary Part 2 Full ReportLibrary Index

Executive Summary

Part 2

How Well Does FEHBP work?

FEHBP has been somewhat more successful than Medicare in controlling costs. However, recent trends indicate that FEHBP’s competitive structure alone cannot guarantee cost control over the long term.

Until recently, FEHBP experienced slightly lower growth in spending per enrollee than Medicare. Over the period 1987 to 1997, Medicare spending per beneficiary grew at an annual rate of 8.1 percent. FEHBP spending per enrollee grew at 7.1 percent a year over the same period, and at much lower rates in the mid-1990s. In the last two years, FEHBP premiums have increased sharply, by 8.5 percent in 1998 and 10.2 percent in 1999. (At the same time, growth in Medicare per capita spending slowed to almost zero in 1998, and may actually decline in 1999.)

The experience under FEHBP thus parallels that recently reported for private employers, sizable premium increases after a brief period of rate stability. Various causes have been suggested for these increases in the private sector, including the growth of less tightly structured managed care plans or an inability on the part of such plans to control the use of new pharmaceuticals and other medical technologies. An additional factor that may have affected spending growth under FEHBP is that, during the early 1990s, there was a significant shift from the employee organization fee-for-service plans to HMOs. This trend ended by 1995. While enrollment in the employee organization plans has continued to drop, the enrollees have been moving to Blue Cross/Blue Shield rather than to HMOs.

Whatever the reason for the recent increases, it is clear that FEHBP’s favorable experience in the mid-1990s is not necessarily an indicator of its likely success in controlling costs in the future. Nothing in the FEHBP structure guarantees control over costs in the long term. While FEHBP might be described as a “premium support” system, it is not a defined contribution program. There is no budgetary limit on the growth in government contributions to FEHBP plans; instead these contributions are tied to the rates established for different plans and the choices made by participants. OPM has some degree of flexibility in negotiating benefits and rates with the plans, but it does so under political constraints.

For example, OPM did not respond to the prospect of an 11.6 percent increase in Blue Cross/Blue Shield rates for 1999 by requiring a significant reduction in benefits. If OPM had sought to restrain growth to, say, 5 percent, the necessary benefit changes would presumably have led to an outcry from employees, unions, and retiree groups. It is likely that HCFA (or any alternative administrative entity) would face even greater resistance if it attempted to meet a vague goal of fiscal restraint by negotiating benefit reductions: benefit changes would affect not only millions of beneficiaries but a health care industry heavily dependent on Medicare payment. As a result, substantive benefit changes would probably continue to be made through the political process.

The FEHBP program is heavily affected by biased selection, the concentration of more costly enrollees in certain plans. This has distorted price competition and penalized higher-risk enrollees, and may have increased government costs.

The 1998 biweekly premiums charged by FEHBP plans to single enrollees range from $41 to $174, a difference of 321 percent. Part of this variation is geographic: the lowest-cost plan is a local HMO in Florida, the highest cost plan a national employee association plan. Even within a geographic area, however, rates vary enormously: in the Washington, D.C. area, the most costly plan charged 2.6 times as much as the least costly. This difference is not related to the benefits offered by the plans-on the contrary, the least generous plans have the highest premiums. Instead, FEHBP premiums appear to be determined largely by the characteristics of the populations they enroll, rather than by their benefits, reimbursement rates, or efficiency in delivering services. Older and sicker participants are heavily concentrated in certain plans. These plans must charge more than the plans with lower-risk enrollees, and the excess cost is passed on directly to the participants.

Why is selection a problem? First, the government may be overpaying the HMOs. The HMO premiums are based on their charges to commercial enrollees and are not necessarily adjusted for characteristics of the FEHBP participants. If the plans are enrolling healthier FEHBP participants, they-or their capitated subcontractors-may be profiting disproportionately from the FEHBP group. This is especially likely because other participating employers may no longer offer a choice of HMO and fee-for-service options, a practice which has long been thought to encourage favorable selection in HMOs. If other groups are now more heterogeneous, including both healthy and sick enrollees, their rates may be inappropriately high for an FEHBP group biased toward healthier enrollees.

Second, and more important, the price differences that FEHBP enrollees see when they are selecting a plan may not reflect differences in benefits, quality, or efficiency-the factors on which plans should ideally be competing. Instead, some plans appear more costly than others because of the populations they have attracted.

Would an FEHBP-Like System Be Better for Medicare?

Proponents of an FEHBP-like system contend that it would make beneficiaries more sensitive to the costs of the different health plan options available to them. would induce them to choose more efficient plans, and would thus reduce the rate of growth in Medicare spending.

Under the current Medicare+CHOICE system, the government pays the full cost for original Medicare; for enrollees in competing health plans the government contributes an amount roughly equal to the cost of original Medicare for comparable beneficiaries. Beneficiaries who choose original Medicare pay the part B premium. Those who choose less costly plans may receive some free or low-cost supplemental benefits, but never pay less than they would for original Medicare; they still pay at least the part B premium.

Under an FEHBP model, the government contribution would be based on the average price of competing plans, including original Medicare. Enrollees who choose less costly plans would share in the savings. Depending on how the program was structured, this could mean that enrollees who remained in original Medicare would pay more than they do now, while enrollees who shifted to less costly plans would pay less.

Potential for Savings

Would adoption of a premium support program actually save money for Medicare over the long term? There is no way of knowing. The real-life models for such a program-including FEHBP and the California Public Employees’ Retirement System (CalPERS)-appeared successful in controlling spending growth earlier in this decade. But per capita spending under these systems is now rising more rapidly than under Medicare.

Competition in itself can produce savings for Medicare only if competing plans can really operate more efficiently than original Medicare does, and only if a representative cross-section of the Medicare population chooses to enroll in those plans. It is by no means certain that private plans can actually provide benefits equivalent to Medicare’s to a comparable population at lower cost.

Original Medicare is a more or less uncontrolled fee-for-service program, and it is likely that improved care management could produce some savings. But managed care plans often achieve much of their savings from provider discounts. Original Medicare already obtains steep discounts from providers. For hospitals, for example, Medicare paid 2 percent above cost in 1996, compared to 21 percent for private payers. In addition, original Medicare’s administrative costs are well below those of any private health plan, because of economies of scale, the absence of certain expenses such as marketing, and the lack of any need to build reserves or show a profit.

This does not mean that measures to promote greater competition under Medicare should not be considered, but only that there is no empirical basis for supposing that these measures will guarantee any particular level of savings. The only way to assure savings under a competitive structure would be for the government to arbitrarily limit growth in its contributions–as FEHBP has not done-leaving beneficiaries at risk of steadily eroding benefits or rising costs.

The Risk Selection Problem

Under both Medicare and FEHBP, there are concerns that competition is based largely on the plans’ ability to attract lower-cost participants, rather than on their relative efficiency. As noted earlier, there is evidence that, under FEHBP, the fee-for-service plans charge higher rates than the HMOs because they have enrolled higher-risk participants. A similar selection problem has occurred under Medicare: most available evidence suggests that sicker beneficiaries have remained in original Medicare and healthier ones have shifted to competing plans.

Under the current payment system, biased selection has raised costs to the government. HMOs have been overpaid, while average fee-for-service costs have grown because the sickest beneficiaries have remained in original Medicare. Under an FEHBP-like system, enrollees in original Medicare (or any other plan with a higher-risk population) would pay the entire excess cost resulting from selection. To avoid this result, the program would need to provide for adequate risk adjustment: steps to correct government contributions and enrollee shares so that high-risk beneficiaries and the plans that enroll them are not penalized. (Medicare has announced an adjustment method to be used beginning in 2000; the proposal has been heavily criticized by health plans.)

Unfortunately, despite recent advances in the measurement of risk, no available system can accurately predict the level of risk presented by a plans’ enrollees. The best available measures at this time overestimate costs for low-risk beneficiaries and underestimate costs for high-risk ones. If high-risk beneficiaries are concentrated in certain plans (such as original Medicare), they will pay inappropriately high premiums because the level of risk assumed by those plans has been understated. This could lead over time to a selection spiral, a steadily widening gap between the apparent prices to enrollees of favorably and adversely selected plans. Moreover, there would be no incentive for a plan to provide high-quality care to the chronically ill or other vulnerable beneficiaries; a plan that did so would merely attract more of these beneficiaries.

Unless this problem can be addressed, the effect of an FEHBP-like system would be to achieve budget savings by shifting the costs of care to beneficiaries, rather than by improving efficiency.

Design Issues for an FEHBP-Like System

If Medicare were to adopt the FEHBP model, the system might work roughly as follows:

1. Medicare would make available a single national fee-for-service plan. The plan would establish a premium sufficient to cover its anticipated costs.2. Other plans, including alternate fee-for-service or PPO plans (like the FEHBP employee organizations) and HMO plans could participate if they met minimum standards. Each of these plans would offer its own benefit package and set its own premium.3. The maximum government contribution would be a fixed percentage of the average premium for participating plans, weighted by enrollment.

This framework leaves open many important design questions. The following is a brief summary of some of the key issues; a fuller discussion is provided in the report.

Should the premium for original Medicare be established locally or nationally? Local variations in medical spending stem in part from real differences in operating cost and in part from unexplained differences in medical practice patterns. To encourage greater uniformity, some have suggested that a national price for original Medicare be established, with adjustments only for local input prices. However, because HMOs and other private plans do not operate nationally, they will inevitably quote local prices. A system that, like FEHBP, allowed competition between nationally and locally priced plans would distort price comparisons and could make beneficiaries in low-cost areas cross-subsidize those in high-cost areas.

Should plans be able to offer benefits less comprehensive than those of original Medicare? A system whose goal was to accommodate consumer preferences might allow beneficiaries who do not feel that they need all the benefits of original Medicare to select a less comprehensive plan. However, if plans are allowed to underbid Medicare by offering less generous benefits, lower-income beneficiaries would face financial pressure to accept substandard coverage. In addition there would be a greater likelihood of biased selection, with the less generous plans attracting the healthiest beneficiaries. If government contributions were based, as under FEHBP, on weighted average premiums for participating plans, the shift of beneficiaries to sub-Medicare options would reduce the contribution, further pressing lower-income beneficiaries to shift. The result could be a sort of race to the bottom, which might stabilize at a level well below current benefits.

To what extent should supplemental benefits be standardized? Unlimited benefit variation would allow consumers to select a plan that is tailored to their needs. At the same time, such variation can make value comparisons difficult for beneficiaries and may promote biased selection. (Similar concerns would arise if plans could substitute some “equivalent” benefits for the basic package.) Plans might be required to offer only one or more defined supplemental packages from a limited menu of possible packages, as is the case for Medigap coverage. Or they might be required to standardize individual benefits rather than entire packages; for example, a plan might or might not include prescription drug coverage, but a plan that included such coverage would have to provide a defined benefit. A third option would be to define a set of permissible supplemental packages and require every carrier to offer every authorized package. There might then be self-selection of enrollees in each type of package, but each carrier would be equally likely to attract enrollees interested in particular benefits.

Should plans be allowed to set a premium lower than the premium for original Medicare? Even if all plans were required to cover the minimum Medicare benefits, some might be more efficient than fee-for-service Medicare. Should they be allowed to share savings with beneficiaries in the form of money– instead of, as now, in the form of supplemental benefits? This approach would obviously lead larger numbers of lower-income beneficiaries to prefer HMOs to Medicare. However, this already occurs under the current system, because the HMOs offer supplemental benefits at a lower cost than Medigap plans do. The existence of plans with a price below that for original Medicare would, again, gradually affect the government contribution if this contribution were set under an FEHBP-like average-price system. However, this is the entire point of considering a premium competition system. If all plans are priced at or above the cost of original Medicare, the government can achieve savings only if it arbitrarily sets its contribution percentage somewhere below the current level. If some plans are allowed to offer lower prices for the same coverage, the government could gradually share in the savings resulting from beneficiary choices. As was suggested earlier, the critical question is whether risk measures are sufficient to assure that these savings do not simply amount to a cost-shift to sicker beneficiaries.

Should the plan premium quotations used in developing the government contribution reflect the cost of providing the minimum benefit package, with supplements priced separately, or should they reflect the cost of the plan’s total benefit package? Under FEHBP, a plan with more generous benefits will quote a higher price than one with less generous benefits. There are several reasons for requiring instead that plans quote prices for the core benefits. First, if the aim of adopting a competitive system is to restrain the growth in Medicare spending, the government presumably does not want its contribution to increase if beneficiaries choose plans with more generous benefits. Second, the requirement would facilitate risk adjustment: if one wishes to index in some way the overall risk presented by different individuals, that index must reflect their likely costs for a uniform package of services.

What is the aim of a risk adjustment system? Even assuming that satisfactory measures of risk can be developed, how these measures are actually used in the payment system will determine whether real competition occurs. Beneficiaries who choose less efficient plans or ones with more “amenities” should pay the excess cost themselves, but beneficiaries should not be penalized because a given plan has attracted sicker enrollees. The focus of the system must therefore be on correcting the prices that enrollees confront when choosing among plans: the price differences among plans visible to beneficiaries should be related to efficiency and not to characteristics of plans’ enrollees. At the same time, the system must neither increase government costs nor deprive any plan of the revenue it requires to operate. Risk adjustment is about fairly allocating premium costs between the government and beneficiaries, not about putting “inefficient” plans out of business.

What should be done about areas in which a competitive approach may not be feasible? In rural or other low-cost areas, private plans may not be able to offer coverage at a cost lower than original Medicare. In order to encourage development of competing plans, Medicare now deliberately overpays private plans in areas with low fee-for-service costs. Over the long term, however, this strategy is fundamentally incompatible with a competitive purchasing policy. Probably there are areas in which it will never be practical or fair to adopt a full competitive model, and the current system will need to be retained more or less unchanged. Criteria may need to be developed for identifying these areas; this will obviously be a difficult technical-and political-problem.

Protections for low-income beneficiaries must be designed, not just to assure that they will retain minimal access to care, but also to limit the likely evolution of a two-tiered care system. Under current law, Medicare premiums for many low-income beneficiaries are paid by Medicaid; many beneficiaries also receive assistance with cost-sharing and supplemental benefits such as prescription drugs. To provide equivalent protection under an FEHBP-like system, subsidies would have to be sufficient to assure that Medicaid-eligible beneficiaries would have some plan available at no cost. This will mean higher subsidies where low-cost plans have limited capacity or are inaccessible to low-income beneficiaries. Even if every beneficiary can join at least some plan, there are quality concerns if low-income beneficiaries-including both those now eligible for Medicaid and the near-poor-do not have a real choice of plans, or if some plans are so costly that they enroll only higher-income participants. Possible solutions include: requiring every plan to accept some beneficiaries at the subsidized price, limiting the maximum price variation of plans, or setting subsidies at a level sufficient to assure that multiple plans in each area are available at no cost. (Consideration should also be given to assisting modest-income individuals above the current Medicaid limits.)

Conclusions

Adoption of an FEHBP-like model for Medicare would require solutions to formidable policy and technical questions that FEHBP itself has never addressed. Some of these have already been discussed: risk adjustment of premiums and government contributions, managing the competition of national and local plans in local markets, and protecting low-income beneficiaries.

Even if all these issues can be resolved, there is no certainty that adoption of an FEHBP-like approach would necessarily save money over the long term. The price increases under FEHBP in the last two years, and similar experiences under other competitive models such as CalPERS, ¹ suggest that the competitive approach is not a formula for meeting a particular budget target. The only way to guarantee savings under a competitive structure would be for the government to arbitrarily limit growth in its contributions–as FEHBP has not done-leaving beneficiaries at risk of steadily eroding benefits or rising costs.

As the nation considers improvements in Medicare, there will undoubtedly be lessons to be learned from FEHBP, as well as from other public and private efforts to develop competitive systems. But Medicare is unique, in the huge and highly vulnerable population it serves and in its impact on the national health care system. There can be no single off-the-shelf model for Medicare restructuring. Instead FEHBP should be regarded as one of many models-successful in some respects, unsuccessful in others-from which policymakers may draw as they work to assure that promise of Medicare is kept for future generations.

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¹Average CalPERS premium increases for 1999 are 7.3 percent. “Employees Facing Steep Increases in Health Costs,” New York Times, Nov. 27, 1998, p. 1 and 26. Return to top

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Medicare Restructuring: The FEHBP Model

Executive Summary

As policymakers consider measures to assure the long-range solvency of Medicare, one option that has received increasing attention is a “premium support” system. Under such a system beneficiaries would choose between the original Medicare fee-for-service program and a variety of competing health plans. They would receive a fixed government contribution toward the plan of their choice and would pay any remaining costs themselves. Proponents of a premium support option have suggested as a model the Federal Employees Health Benefits Program (FEHBP), which offers multiple plans to federal employees and annuitants.

How Do Medicare and FEHBP Differ?

Medicare beneficiaries in many areas already have a choice between original Medicare and Medicare-contracting HMOs. The Medicare+CHOICE program established by the Balanced Budget Act (BBA) of 1997 will broaden the health plan options available to beneficiaries and provide for more structured competition. As a result, Medicare’s operations will more closely resemble those of FEHBP.

Table E-1 compares key features of the Medicare+CHOICE and FEHBP programs. Similarities in the two programs have sometimes been obscured by differences in terminology and administrative structures:

• Under both programs, participants may choose from among competing plans during a uniform open enrollment period, and may change plans only at specified times.
• Once the BBA is fully implemented, participants in both programs will receive uniform comparative information on the health plan options available to them.
• Under both programs, the most popular plan is a national fee-for-service plan. Medicare’s plan, “original Medicare,” is operated by the government on a self-insured basis. The FEHBP national plan is operated by a private insurer, but the insurer is not really at risk and effectively functions as an contracted administrator. Under both programs, the national plan operates under an open-ended federal spending commitment.

Still, there are important differences between Medicare+CHOICE and FEHBP:

• Medicare beneficiaries are enrolled by default in original Medicare and must actively choose to shift to a different plan. All FEHBP participants must make an initial choice of health plans.
• Medicare beneficiaries have a choice of plans only when there is a managed care plan available in their area. FEHBP participants in all areas have a choice of multiple fee-for-service plans; they may or may not have an HMO available.
• Original Medicare has a guaranteed minimum defined benefit package that can be modified only by an act of Congress; other plans (except medical savings account plans) must offer at least these minimum benefits. No minimum benefits are guaranteed under FEHBP; benefit changes for any plan can be negotiated by the Office of Personnel Management (OPM).
• The government contribution for Medicare options is fixed in advance, using a formula based in part on historic local costs for original Medicare, subject to national minimums and maximums. The contribution for FEHBP reflects the weighted average cost or price of all available plans.
• Premiums and government contributions for Medicare+CHOICE plans partially reflect costs in specific localities and are adjusted for enrollee demographics (and, beginning in 2000, risk). Under FEHBP, nationally priced fee-for-service plans compete with locally priced HMOs, and there are no demographic or risk adjustments.
• A Medicare enrollee who selects a plan that costs less than the government contribution receives the savings in the form of additional benefits. An FEHBP enrollee who selects a less costly plan receives some of the savings in the form of reduced premium payments.
• OPM has greater discretion than the Health Care Financing Administration (HCFA) in determining what plans may participate and in negotiating premium rates and benefits.

Table E-1. Comparison of Medicare+CHOICE and Federal Employees Health Benefits Program Medicare + CHOICE FEHBP Choice of plans Beneficiaries are enrolled by default in original Medicare (the fee-for-service program operated by the government). They may obtain private supplemental coverage or may choose to obtain Medicare benefits (plus supplements) from a local or regional HMO, PPO, or other coordinated care plan; a private fee-for-service plan; or an MSA plan.

81 percent of beneficiaries are in original Medicare; 19 percent in HMOs or similar plans. Participants choose from among: a national Blue Cross/Blue Shield PPO plan, national fee-for-service plans operated by employee associations (also usually with PPO options), and about 300 local or regional HMOs, some of which offer point-of-service options.

70 percent of enrollees are in Blue Cross/Blue Shield or other fee-for-service plans; 30 percent in HMOs. Benefits All plans must provide at least the same benefits as original Medicare. Most provide supplemental benefits, including reduced cost-sharing and often additional services such as prescription drugs. (Plans whose expected Medicare profit margin is greater than that for commercial enrollees must share the excess profit in the form of supplemental benefits.) Each plan designs its own benefits subject to limited guidance from OPM. There is no fixed minimum, and benefits vary widely. Premium rates Each HMO or other plan quotes a premium for basic Medicare benefits plus any supplements.

The rate is based on what the plan would charge non-Medicare enrollees for the same benefits, adjusted for characteristics of Medicare enrollees. Each plan quotes a premium for its benefit package.

For most HMOs, the rate is what the plan would charge other large groups for the same benefits; it may or may not be adjusted for characteristics of FEHBP enrollees. For fee-for-service plans, the rate is based on actual expected costs for FEHBP enrollees. Government contributions For each enrollee, the government pays according to a fixed formula that does not take into account rates of competing plans. The government contribution varies by geography and demographic and risk characteristics of plan enrollees. For each enrollee, the government pays the lesser of: 75 percent of the plan’s premium, or 72 percent of the weighted average premium for all plans. The government contribution is not adjusted for enrollee demographics, risk, or geography. Enrollee contributions All beneficiaries pay a monthly part B premium. Enrollees in Medicare+CHOICE plans may pay an additional premium if the government contribution does not cover the plan’s full price for its benefits. The enrollee pays the portion of the plan premium not covered by the government contribution (never less than 25 percent of the plan’s premium). Plan risk The premium represents payment in full; each plan is at risk for costs exceeding premium revenues. Contingent reserves are established for each plan through a premium surcharge paid by the government and enrollees. The plan may draw on these reserves if costs exceed premium revenues. Budgetary treatment Entitlement: Medicare must pay for covered services defined by law at rates defined by law, without budgetary limit. Virtual entitlement: agencies must pay the government contribution defined by law for the plans chosen by their employees. OPM can affect this amount by negotiating premiums and benefits, but does so without any spending target. Enrollment and consumer information When Medicare+CHOICE is fully implemented, beneficiaries may generally change plans only during fixed periods. HCFA is making some progress toward providing comparative information on plan options. Enrollees may generally change plans only during an annual open season. OPM provides extensive comparative information on plans. Administration HCFA’s dealings with plans are governed by explicit statute and regulations. HCFA’s administrative costs (for functions equivalent to OPM’s) equal 0.2 percent of benefit payments. OPM has somewhat greater discretion to select health plans and negotiate benefits and premium rates. OPM’s administrative costs equal 0.1 percent of benefit payments.

Summary Part 2

The full report is available in PDF.

Additional free copies of this summary (#1462) and the full report on which it is based (#1461) are also available by calling our publications request line at 800-656-4533.Return to top

Medicare Restructuring: The FEHBP ModelSummary Part 1 Summary Part 2 Full Report