Prudential to Exit Some Medicare HMO Plans

Prudential Insurance Co. of America said it will withdraw from the Medicare health maintenance organization business in California, Maryland, New York and New Jersey, affecting about 25,000 customers of its managed-care unit. Prudential is the latest large managed-care company to announce that it’s withdrawing from the Medicare HMO business in certain areas as health insurers struggle to cope with government plans to cut growth in payments by $20 billion over five years. Medicare is the government health program for the elderly. Newark, N.J.-based Prudential, which is owned by its policyholders, is the largest U.S. life insurer and offers a range of financial services. Prudential said it’s withdrawing Medicare HMOs in areas where it couldn’t offer a “competitive” product. Prudential said it will honor its obligation to all of its SeniorCare members in California and elsewhere until the end of the year and said no one will lose coverage as a result of its exit from a particular market.