While some regional offices may review materials that certain organizations distribute nationwide, generally each regional office is responsible for reviewing the materials to be distributed within its geographic jurisdiction. 1.) 2.) Another MCO provided conflicting information about its prescription drug benefit. To help beneficiaries make informed choices, BBA requires HCFA to provide beneficiaries with summary plan information before the annual November enrollment period. However, other MCOs did not disclose important restrictions in any member literature. By establishing an MCO’s Medicare contract—a document that is not usually available to beneficiaries—as the only document required to fully explain the plan’s benefit coverage, HCFA cannot ensure that beneficiaries are aware of the benefits to which they are entitled. 4). For example, it was difficult to determine whether the three plans offered by one MCO covered nonemergency ambulance transportation, because each plan’s materials used different terms to describe the benefit. Weaknesses in HCFA’s Review Process Allowed Problems in Plan Materials to Go Uncorrected

Although HCFA approved all the member literature we reviewed, weaknesses in three critical elements of the agency’s review process allowed errors to go uncorrected and important information to be omitted. Additionally, HCFA’s lack of consistent standards has contributed to inconsistent reviews and extra work and may have increased the chance of errors slipping through the review process undetected. HCFA reviewers are instructed to use the BIF to check that plan member literature accurately reflects the contracted benefits and member fees. Because BIFs are often incomplete, reviewers sometimes rely on benefit summary sheets provided by MCOs to verify the accuracy of plan materials. The lack of mandatory format and terminology standards for key member literature, such as benefit summary brochures and member policy booklets, increases the amount of time and effort needed to review and approve plans’ member literature. However, MCOs did not always correct the errors HCFA identified during the review process. We reviewed one plan’s summary of benefits that incorrectly commingled 1997 and 1998 benefit information. Some plans distributed inaccurate or incomplete information or provided the information after beneficiaries had made their enrollment decisions, when it was less useful. In contrast, each FEHBP plan must provide prospective enrollees with a single, comprehensive brochure to facilitate comparisons and informed enrollment choices. Recommendations to the Administrator of the Health Care Financing Administration

In October 1996, we recommended that the Secretary of Health and Human Services direct the HCFA Administrator to (1) require standard formats and terminology for important aspects of MCOs’ marketing materials, including benefits descriptions, and (2) require that all literature distributed by organizations follow these standards. Fully implement HCFA’s new contract form for describing plans’ benefit coverage, the PBP, for the 2001 contract submissions to facilitate the collection of comparable benefit information and help ensure full disclosure of plans’ benefits. However, requiring MCOs to provide an FEHBP-like brochure, in addition to other plan materials, would preserve the MCOs’ flexibility and provide Medicare beneficiaries with more complete and comparable information than they may currently receive. Finally, we compared the Federal Employees Health Benefits Program and Medicare’s standards for plans’ member literature.
Why GAO Did This Study

Pursuant to a congressional request, GAO provided information on the Medicare Choice program, focusing on: (1) the extent to which managed care organizations' (MCO) member literature provides beneficiaries with accurate and useful plan information; and (2) whether the Health Care Financing Administration's (HCFA) review process ensures that beneficiaries can rely on MCOs' member literature to make informed enrollment decisions.

What GAO Found

GAO noted that: (1) although HCFA had reviewed and approved the materials GAO examined, all 16 MCOs in GAO's sample from four HCFA regions had distributed materials containing inaccurate or incomplete benefit information; (2) almost half of the organizations distributed materials that incorrectly described benefit coverage and the need for provider referrals; (3) one MCO marketed (and provided) a prescription drug benefit that was substantially less generous than the plan had agreed to provide in its Medicare contract; (4) moreover, some MCOs did not furnish complete information on plan benefits and restrictions until after a beneficiary had enrolled; (5) other MCOs never provided full descriptions of plan benefits and restrictions; (6) although not fully disclosing benefit coverage may hamper beneficiaries' decisionmaking, neither practice violates HCFA policy; (7) as GAO has reported previously, it was difficult to compare available options using member literature because each MCO independently chose the format and terms it used to describe its plan's benefit package; (8) in contrast, the Federal Employees Health Benefits Program's (FEHBP) plans are required to provide prospective enrollees with a single comprehensive and comparable brochure to facilitate informed enrollment choices; (9) the errors GAO identified in MCO's member literature went uncorrected because of weaknesses in three major elements of HCFA's review process; (10) limitations in the benefit information form (BIF), the contract form that HCFA reviewers use to determine whether plan materials are accurate, led some reviewers to rely on the MCOs themselves to help verify the accuracy of plan materials; (11) additionally, HCFA's lack of required format, terminology, and content standards for member literature created opportunities for inconsistent review practices; (12) according to some regional office staff, the lack of standards also increased the amount of time needed to review materials, which contributed to the likelihood that errors could slip through undetected; (13) HCFA's failure to ensure that MCOs corrected errors identified during the review process caused some beneficiaries to receive inaccurate information; and (14) HCFA is working to revise the BIF and develop a standard summary of benefits for plans to use--steps that will likely improve the agency's ability to review member literature and other marketing materials--but other steps could be taken to improve the usefulness and accuracy of plan information.