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GOP Pushing HMOs as Key to Curbing Medicare Costs : Reform: Proposal to get elderly to join health care networks is a central part of the drive to balance budget.


Last month, Davis' 77-year-old wife underwent triple-bypass surgery. Kaiser Permanente's cardiologist conducted all the necessary tests and sent her to an outside team of heart surgeons--among the best-known in the state--for the surgery. She was transferred back to a Kaiser hospital four days after the operation and was later discharged. She paid nothing.

"You can imagine, that would have been thousands and thousands of dollars if we would've had to pay it," Davis said.

Taylor of Secure Horizons said that any system would have perverse incentives--to spend either too much or too little. "The solution is to have a system to monitor good care and make sure it happens," he said.

"Medicare HMOs can and do provide high-quality care," said Dallek of the patient-rights group in Los Angeles. But she said she wants reforms to require an easier and speedier appeals process if HMOs reject treatment or refuse referrals to a specialist. And she warns of widespread abuses by some commission salespeople who enroll new HMO members without explaining that the customers must stay within the HMO medical network for their care.

For such markets as California and Oregon, with long histories of HMOs, the revolution promoted by the GOP has been under way since World War II, when Henry J. Kaiser provided prepaid health plans for his shipyard workers.

Kaiser Permanente's long history in Portland and the large proportion of Oregon residents who live near the metropolitan area made the state ripe for managed care. Many workers who enrolled in HMOs as part of their company health plans simply aged into the new Medicare HMOs.

"Managed care is not as frightening a prospect to patients and providers here as it is in the rest of the country," said Oregon Gov. John Kitzhaber, a physician and one of the key architects of the state's health plans. "I would defy anybody to show that our elderly population suffers any less quality of care than anywhere else in the country."

Murphy reported from Portland and Rosenblatt from Washington, D.C. Times researcher Doug Conner in Seattle also contributed to this story.

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