BBA permitted new types of health plans, such as PPOs, to participate in Medicare and included provisions designed to encourage a wider geographic availability of health plans. The extent to which this will occur is uncertain. Expenditures

On average, HCFA spent $107.8 million annually to run NMEP in fiscal years 1998, 1999, and 2000. Funding Sources

During NMEP’s first 3 fiscal years (1998 to 2000), approximately three- fourths of the expenditures were funded from user fees collected from M+C plans. Beneficiary and Plan Reaction to NMEP

Beneficiaries and beneficiary advocacy groups generally praised NMEP’s major activities. Industry officials representing M+C plans offered a mixed reaction to NMEP. Most of HCFA’s research and implementation efforts concentrated on improving the mandated information outlets—the Medicare handbook, telephone help line, Internet site, and local education programs—and the content of the information available through those outlets. However, HCFA-sponsored research suggests that NMEP may need to adopt new education strategies to encourage other beneficiaries to actively consider their Medicare options. BBA requirements. For example, the mailing must include information on the FFS program’s covered benefits and cost sharing; procedures for selecting an M+C plan or the FFS program; beneficiary rights and the appeals process in both M+C plans and the FFS program; and descriptions of benefits, enrollment rights, and other requirements of Medicare supplemental policies (Medigap). We also spoke with representatives from beneficiary advocacy groups (AARP, Medicare Rights Center, and the Center for Medicare Education) and health care plan associations (American Association of Health Plans and the Health Insurance Association of America). 10, 1997).
What GAO Found

The Balanced Budget Act of 1997 (BBA) established the Medicare+Choice (M+C) program to expand health plan choices. BBA permitted Medicare participation by preferred provider organizations, provider-sponsored organizations, and insurers offering private fee-for-service plans or medical savings accounts. It also encouraged the wider availability of health maintenance organizations, which have long been an option for many beneficiaries. To help beneficiaries understand and consider all of their Medicare options, the National Medicare Education Program offers a toll-free help line, informational mailings to beneficiaries, an Internet site, and educational and publicity campaigns. During fiscal years 1998 through 2000, the Health Care Financing Administration (HCFA) spent an average of $107.8 million on the program annually. Most of the money came from user fees collected from M+C plans. Reaction to the program has generally been positive among beneficiaries and beneficiary advocacy groups, but representatives of M+C plans offered a mixed assessment. Program activities have increased the information available to beneficiaries on Medicare, the M+C program, and specific health plans. However, the extent to which the program has motivated beneficiaries to actively weigh their health plan options is unknown.