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Medicare Plan Includes HMO, Payment Control Provisions

By Robert A. Rosenblatt and Edwin Chen
Los Angeles Times

House Republicans issued a general blueprint Thursday calling for expanded choices for beneficiaries, combined with tough government controls on payments to health providers.

The GOP outline expressed confidence that millions of Medicare beneficiaries will save government revenues by moving into health maintenance organizations and other forms of managed care.

But the 60-page document did not offer dollar figures on how much of the $270 billion goal would come from managed care savings, and how much would be provided through higher payments by the beneficiaries themselves.

In a bid to blunt Democratic criticism that the savings will hurt senior citizens, Gingrich said Medicare's total spending would rise every year under the GOP plan.

Democrats say the $270 billion in savings is far in excess of the amount needed to guarantee the solvency of the Medicare in the short-run, and they accuse Republicans of seeking money to finance tax cuts targeted heavily toward the rich.

The leading provisions of the GOP plan would:

-Offer all beneficiaries a once-a-year selection from among several government-approved plans, including HMOs, or other networks of doctors and hospitals, or special Medical Savings Accounts.

-Beneficiaries who select none of those choices would remain in the current fee-for-service system, which allows them to select any doctor or hospital.

-Increase the monthly Part B premium paid by all beneficiaries for doctor services, now $46.10, to approximately $90 in 2002.

-Impose "means testing" on seniors making more than $75,000 a year, or couples with more than $125,000, and require them to pay more their part B coverage.

-Impose a limit of $250,000 for "pain and suffering," in addition to economic damages, for those who win malpractice suits. Claims would have to be filed no more than two years after the incident.