Health Insurer Probed For Enlisting Beneficiaries To Fight Reform Proposal

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September 21, 2009 8:19 a.m.

Health insurer Humana Inc. portrays itself as a guide through the treacherous waters of health-care coverage. The company’s tagline is “Guidance When You Need It Most,” and switchboard operators at its Louisville headquarters answer the phone by asking callers: “How can I guide you?”

But is Humana guiding its customers a little too much in enlisting them to oppose a key aspect of health-care reform?The Centers for Medicare and Medicaid Services is probing the company’s campaign to get its beneficiaries to lobby lawmakers against Sen. Max Baucus’s proposal to make cost-saving cuts to Medicare Advantage, reports (sub. req.) the Wall Street Journal. Humana is one of the largest providers of Medicare Advantage.

The inquiry, which was pushed by Baucus’s office, is focused on letters sent by Humana to its beneficiaries in Michigan, Florida, and other states, claiming that “millions of seniors and disabled individuals could lose many of the important benefits and services that make Medicare Advantage health plans so valuable.” A copy of the letter, obtained by TPMmuckraker, can be seen here.

It’s also looking into a Humana website which allowed users to send form emails to their members of Congress, urging them to oppose cuts to Medicare Advantage. An email generated this morning on behalf of TPMmuckraker stated, falsely, that the sender is a Medicare Advantage member. The site contains no mechanism to ensure that this is the case. (The text of the email is below.)

According to the Journal, CMS on Friday asked Humana to stop the mailings and shut down the website. On Monday morning, the website was still in operation when TPMmuckraker tested it around 9:30 a.m. But around two hours later, it appeared to have been disabled.

A CMS official told the Journal that the agency “places strict limits and oversight on how plans communicate with beneficiaries,” and that if the company violated those rules, it could be fined or suspended from marketing its plans and enrolling new beneficiaries.

In Medicare Advantage, the government pays private insurers like Humana to manage beneficiaries’ care. The plans offer additional benefits to ordinary Medicare, and on average cost the government 14% more per beneficiary than the regular program, according to the Journal.

Baucus’s recently unveiled health-care reform plan would save money by cutting payments to Advantage by $123 billion over 10 years. Democrats deny that this would threaten important benefits or services.

A Baucus spokeswoman told the Journal: “[Humana’s] tactics do a disservice to beneficiaries by spreading false claims about such an important bill in Congress. Cutting the fat from the profits of private health plans that deliver Medicare is the best way to ensure the sustainability of the program and preserve the Medicare benefits seniors depend upon.”

Humana’s campaign against cuts to Medicare Advantage hasn’t been confined to mobilizing its beneficiaries, of course. According to lobby disclosure reports examined by TPMmuckraker, the company has spent over $1.2 million lobbying both Congress and CMS itself on a range of health-care issues, including Medicare Advantage. One registered lobbyist for Humana is former Baucus chief of staff David Castagnetti, of Mehlman, Vogel, and Castagnetti. Humana has also hired Alston & Bird, which employs Tom Daschle and Robert Dole.

We’ve reported on a health-care company CEO who personally urged his own employees to similarly get involved — a tactic that seems to take advantage of the pressure an employee may feel to please the boss. But when beneficiaries are the target of the request, that pressure — potentially driven by concern that coverage could be affected if they don’t comply — may be even more acute. That’s why CMS has rules that regulate these sorts of communications.

We’ve contacted CMS, Humana, and Baucus’s office for more information, and will keep you posted.

Below is the full text of Humana’s auto-generated email to members of Congress, which appears to have been disabled this morning:

I am a constituent and a Medicare Advantage member. I am writing today to urge you to oppose large Medicare funding cuts that could mean higher costs and fewer choices for Medicare Advantage members like me.

Medicare Advantage plans provide important wellness, prevention and care coordination benefits — exactly the kind of health-focused programs that can help make American health care more affordable for everyone, not just people with Medicare. In fact, proposed health care reform bills actually include many of these features for everyone else while cutting funding for seniors and the disabled.

A drastic Medicare Advantage cut could reduce my benefits, increase my costs and leave fewer choices for me. I depend on Medicare Advantage. Please help me by opposing drastic funding cuts to this vital program.

Thank you for your time and consideration.

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