Just a little over a year ago I became a Medicare recipient. Until that time both Mr. Nappe and myself benefited from a pretty good insurance program through my employer; although every few years it went through some changes that increased or reduced some coverage; altered co-pays; limited or changed providers, etc. Even so, overall, it was pretty seamless, and mindless. Consequently, when the time came to deal with the transition to Medicare a lot of time and effort and stress and head scratching went into deciding what path to take.
Now, anybody who has a TV has probably seen the endless year round commercials featuring Joe Namath or Jimmy Walker. However, at this time of year, everybody else with a possible profit to make gets on the bandwagon — insurance brokers, health insurance companies, etc. And man, those plans have it all — regular medical care, and vision, hearing, and dental care, free meals and transportation — you name it! And even extra money in your Social Security check — oh, my!
For those of us in in the Medicare age bracket, or on Medicare rolls, besides the TV ads there are endless mailings, phone calls, and other efforts to “reach out” with similar pitches. This marketing onslaught will continue until Pearl Harbor Day — 12/7/21. All of those pitches are pretty enticing. All of them also smack of the very finest snake oil.
Advertisements for Medicare Advantage plans are pervasive during the Annual Enrollment Period. They can also make these plans seem tempting, with their myriad benefits and low premiums.
An Advantage plan could be the right plan for you, but it’s important to do your research and speak to a Medicare agent about your needs rather than hastily enrolling in a plan that sounds great in its TV commercial. Out-of-pocket costs for doctors outside your network could add up to more than what a Medigap premium would cost each month.
Advantage plans are heavily advertised because of how they are funded. These plans’ premiums are low or nonexistent because Medicare pays the carrier whenever someone enrolls. It benefits insurance companies to encourage enrollment in Advantage plans because of the money they receive from Medicare.
This is why our time, effort, and head scratching led us to eschew Medicare Advantage plans, which charge the government more to provide us with less. So, a year later, we have an opportunity to revisit our decisions. At this time we see no particular reason to change. In addition there is reinforcement for staying the course. I reference the email received from the broker who connected us with Mr. Nappes plan G Aetna provider and my plan G BCBS provider. Following that is an excerpt from a local lawyer specializing in estate and elder law who promotes a weekly column in our paper.
The first day of the Medicare open enrollment period starts October 15th. You will want to review your Part D during this period. But over the next three months, you will also see many advertisements for Medicare Advantage Plans. Here is what you need to know when you are considering whether or not to enroll in one.
- You are enrolling into managed care. You are agreeing to have your healthcare contracted out to the Medicare Advantage plan. Medicare will now pay the Medicare Advantage plan to take care of your health care. Claims are no longer paid by Medicare A+B. Instead, all claims are paid by a private insurance company.
- Medicare Advantage plans are more limited in terms of providers. They usually come in the form of either an HMO or PPO. So if you go outside the network, you either are not covered or you have less coverage. In addition, providers can leave the network at any time.
- Your out of pocket is higher. If you have a Medicare supplement Plan G, right now you are only responsible for the $203 Part B deductible. On Medicare Advantage plans in 2022, there are copays, coinsurance and deductibles with an out of pocket maximum of up to $4,000-$7,500/year if you stay in network.
- Right now you don’t need referrals or pre-authorization. Medicare Advantage plans require them since you are in managed care. The Medicare Advantage plan decides what is necessary and what is approved. My mom’s doctor does not like them because he says they seem to restrict care at the end of the year because they are trying to make a profit.
- Medicare Advantage plan agents often don’t explain the health insurance portion. They focus on the bells and whistles like dental and vision rather than explaining the above information to the policyholder.
- Some of the plans advertise that everything is free “if you qualify”. To qualify for everything being free probably means you would have to be on both Medicare and Medicaid (low income).
“Studies show the main reason Medicare Advantage enrollees return to traditional Medicare is how badly the corporate insurers treated them when they become sick. All of this anxiety, dread, and fear, all of these arbitrary denials of care under a Medicare Advantage plan are prompted by a pay-or-die commercial profit motive.”
Indecision Time – You, Medicare and the Insurance Companies
A quick comparison is in order. Medicare Advantage is a bundled plan that includes Parts A, B and, usually, Part D. If you purchase a Medicare Advantage plan, then you would only be dealing with one company for most of your health care insurance, which is convenient. What is not convenient is that Medicare Advantage is a managed care plan, with limited provider networks. There are different kinds of Medicare Advantage plans. If your plan is a PPO, you may be able to go to an out-of-network provider but will likely have to pay a higher share of the cost. If your plan is an HMO, then you may be limited to in-network providers, except for emergency services. As of July 2020, 24% of Medicare beneficiaries were in Medical Advantage HMOs, while 15% were in PPOs.
Some Medicare Advantage plans market that they include extra benefits not covered by Original Medicare, such as vision, hearing and dental. This may sound attractive, but before you decide you need to look further into the coverage description because most plans are very limited.
A Medicare Advantage plan has the discretion to alter its “cost-sharing,” which is a genteel description of your out-of-pocket costs. Unlike Original Medicare, an MA plan can charge cost-sharing for the first 20 days. These cost-sharing expenses can be more than what you would pay with Original Medicare.
Then there is that pesky prior authorization. Under an MA plan, you will usually be required to receive prior authorization before a service will be covered. This can lead to problems accessing care. Original Medicare, in contrast, does not generally require prior authorization for services.
I know many here have enrolled in Advantage plans and are very happy with their decision. There are certainly a few benefits to them if you are willing to accept the trade offs. This post just outlines some of the thinking that went into our decision to take another route.
This is a Creative Commons article. The original version of this article appeared here.