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Medicare HMOs Continue To Cut Programs Across Country

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Three short years ago Congress was pushing for increased use of “managed care” plans as one way to stave off a looming financial crisis for the federal Medicare program. Today the promise of managed care continues to be unmet—largely because of Congress’ own actions.

The federal government picks up almost 40% of all health care costs in this country, with almost half of that amount (just under 19%) paid by the Medicare program. Medicare covers over 13% of all American citizens. The program offers hospitalization, out-patient care, hospice and home health care, together with a limited nursing home benefit, to most citizens over age 65, the totally disabled and a handful of other beneficiaries.

Medicare HMOs (Health Maintenance Organizations) first began to sign up significant numbers of participants in 1995, and by 1996 Tucson had more of its Medicare recipients enrolled in HMOs than nearly any other community in the country. The New York Times, in an article published in March, 1996, predicted that the Tucson experience would soon sweep the nation, and that Medicare HMOs would continue to grow as seniors learned they could save money and still get good care.

Then Congress derailed its own HMO plans. In passing the Balanced Budget Act of 1997, Congress made it much more difficult to operate a profitable Medicare HMO. The result: in the next year (1998), over 400,000 HMO members were dropped when their health plans curtailed coverage in particular areas, especially in rural communities.

HMOs did not end their flight away from Medicare programs in that year, either. In 1999 another 327,000 enrollees were dropped by their HMOs, and almost a million more will lose coverage in the year 2000.

None of those HMO participants will actually lose Medicare coverage, of course. As HMOs pull out of the Medicare market, individual plan members are free to switch to another HMO (assuming another HMO offers coverage in their area) or return to “traditional” Medicare. They may find the choice of doctors or the extent of coverage sharply curtailed, however.

The 1996 New York Times article cited strong HMO competition in Tucson, with four companies offering different programs. That competition has now shrunk to just two HMOs in the Tucson area: Intergroup of Arizona, Inc., and PacifiCare of Arizona, Inc. (PacifiCare actually offers three slightly different programs under its Secure Horizons name). One HMO (Intergroup) offers coverage in Nogales, and four are active in parts of Pinal County, but the rest of Southern Arizona has no Medicare HMO coverage available. That experience is mirrored across the country as HMOs pull out of Medicare, particularly in rural areas.

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Robert B. Fleming


Robert Fleming is a Fellow of both the American College of Trust and Estate Counsel and the National Academy of Elder Law Attorneys. He has been certified as a Specialist in Estate and Trust Law by the State Bar of Arizona‘s Board of Legal Specialization, and he is also a Certified Elder Law Attorney by the National Elder Law Foundation. Robert has a long history of involvement in local, state and national organizations. He is most proud of his instrumental involvement in the Special Needs Alliance, the premier national organization for lawyers dealing with special needs trusts and planning.

Robert has two adult children, two young grandchildren and a wife of over fifty years. He is devoted to all of them. He is also very fond of Rosalind Franklin (his office companion corgi), and his homebound cat Muninn. He just likes people, their pets and their stories.

Elizabeth N.R. Friman


Elizabeth Noble Rollings Friman is a principal and licensed fiduciary at Fleming & Curti, PLC. Elizabeth enjoys estate planning and helping families navigate trust and probate administrations. She is passionate about the fiduciary work that she performs as a trustee, personal representative, guardian, and conservator. Elizabeth works with CPAs, financial professionals, case managers, and medical providers to tailor solutions to complex family challenges. Elizabeth is often called upon to serve as a neutral party so that families can avoid protracted legal conflict. Elizabeth relies on the expertise of her team at Fleming & Curti, and as the Firm approaches its third decade, she is proud of the culture of care and consideration that the Firm embodies. Finding workable solutions to sensitive and complex family challenges is something that Elizabeth and the Fleming & Curti team do well.

Amy F. Matheson


Amy Farrell Matheson has worked as an attorney at Fleming & Curti since 2006. A member of the Southern Arizona Estate Planning Council, she is primarily responsible for estate planning and probate matters.

Amy graduated from Wellesley College with a double major in political science and English. She is an honors graduate of Suffolk University Law School and has been admitted to practice in Arizona, Massachusetts, New York, and the District of Columbia.

Prior to joining Fleming & Curti, Amy worked for American Public Television in Boston, and with the international trade group at White & Case, LLP, in Washington, D.C.

Amy’s husband, Tom, is an astronomer at NOIRLab and the Head of Time Domain Services, whose main project is ANTARES. Sadly, this does not involve actual time travel. Amy’s twin daughters are high school students; Finn, her Irish Red and White Setter, remains a puppy at heart.

Famous people's wills

Matthew M. Mansour


Matthew is a law clerk who recently earned his law degree from the University of Arizona James E. Rogers College of Law. His undergraduate degree is in psychology from the University of California, Santa Barbara. Matthew has had a passion for advocacy in the Tucson community since his time as a law student representative in the Workers’ Rights Clinic. He also has worked in both the Pima County Attorney’s Office and the Pima County Public Defender’s Office. He enjoys playing basketball, caring for his cat, and listening to audiobooks narrated by the authors.