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The Kaiser Family Foundation has released two new issue briefs that describe the current landscape of private plans participating in Medicare.


The Growth of Private Plans in Medicare, 2006 details the different types of private plan options available to people on Medicare. These include Medicare Advantage plans (such as Medicare HMOs, PPOs, and private fee-for-service plans) and new stand-alone prescription drug plans.


* In 2006, all Medicare beneficiaries have access to at least one type of private Medicare Advantage plan, up from 77% in 2004. The increase in access stems largely from the creation of new Medicare regional PPOs and the expansion of private Medicare fee-for-service plans. About 13% of Medicare beneficiaries (5 million) are enrolled in private Medicare Advantage plans.


* The introduction of regional PPOs in 2006 and the growth in private fee-for-service plans have expanded access to private plans in rural areas in particular, but HMOs continue to be more common in urban areas. Medicare HMOs are not offered in eight states: Alaska, Delaware, Maine, Montana, North Dakota, South Dakota, Vermont, and Wyoming.


* Special needs plans are available in all but nine states. These plans serve beneficiaries who are eligible for Medicare and Medicaid, institutionalized beneficiaries, and those with severe chronic or disabling conditions, or both.



The second issue brief, The Landscape of Private Firms Offering Medicare Prescription Drug Coverage in 2006, describes the key characteristics of the organizations that offer the new Medicare drug benefit and analyzes how companies are positioning themselves to attract Medicare enrollees.


* Seven of the 10 organizations that sponsor stand-alone prescription drug plans nationwide are based in commercial insurance firms with substantial Medicare Advantage experience, and three of the 10 firms are in the pharmacy benefit management and service sector.


* Nine of the 10 organizations that sponsor stand-alone prescription drug plans nationwide offered a Medicare-endorsed discount card in 2004 and 2005 or partnered with a firm that did.


* Most of the major firms that dominated the Medicare Advantage program before 2006 have expanded their options and offer stand-alone prescription drug plans to appeal to a broader range of beneficiaries.



Both issue briefs are authored by Marsha Gold, ScD, of Mathematica Policy Research, Inc, and are available online at