As you’re thinking about your Medicare options this Fall, don’t be seduced by the bells and whistles available from some Medicare Advantage plans, the Medicare private options through which corporate health insurers contract with the federal government to deliver Medicare benefits. These corporate health plans profit from denying their members needed health care, and many of them deny care all too often. The big problem is that it is impossible to know which ones do and which ones do not.
Congress allows Medicare Advantage plans to spend money on health-related services that otherwise would be spent on medical services. Those might be valuable. But, the question is to what extent these health plans are stinting on the delivery of medical care, which could be more critical to your health and well-being if you have or develop a complex condition. And, that is hard to know.
The corporate Medicare plans do not explain how they allocate funds for the additional non-medical services they offer. They are not receiving extra money to do so. For the last several years, federal audits suggest that they have overcharged the government tens of billions a year for their services. Those overpayments may be one way they fund the non-medical services they sometimes offer, though the government is trying to get that money back.
They also may be funding these extra services by denying coverage for critical medical care inappropriately and/or by charging high copays for people who need care. There is no data on plan denial rates or copay amounts these plans charge their members for different services, so neither denial rates nor copay amounts can be a basis for choosing a plan.
Medicare private health insurance options also are not reporting accurately or completely the Medicare-covered services they are delivering their members, as they are required to do by law. That should give people who consider joining these plans pause. It’s reasonable to believe that they are stinting on the delivery of the medically necessary services they are supposed to be covering and charging high copays for costly services.
Given the data, you should be concerned that if you join a Medicare private plan, you might be denied the care or coverage your treating physicians believe you need. Unfortunately, the star-ratings are of no help in choosing a plan.
All this said, Medicare Advantage plans have lower upfront costs than traditional Medicare. Because traditional Medicare does not have an out-of-pocket cap, it can be expensive to buy supplemental coverage that fills gaps, if you don’t have wrap around coverage from a former employer or Medicaid. And, if you end up not needing a lot of care, it can be more expensive than Medicare private health insurance.
The problem is that if you have a complex condition, you are taking a gamble with Medicare private options. You’re gambling that the doctors you want to use are in the network and remain in the network. You are gambling that it will cover the care you and your doctors believe you need. You’re gambling that the copays will not be prohibitive and create a barrier to care. Your out-of-pocket costs for in-network medical care alone can be as high as $7,550 a year.
Do a lot of homework before choosing a Medicare private plan. Talk to your doctors. Find out which Medicare Advantage plan networks they are in, which Medicare Advantage plan they like most, and which, if any, they have issues with. You can get free guidance from your State Health Insurance Assistance Program or SHIP.
One thing to keep in mind. If you are switching from fee-for-service traditional Medicare, (the Medicare public option,) to a Medicare Advantage plan, you might not be able to switch back. You could be locked out of traditional Medicare if you develop a health condition and live in a state that does not require Medicare supplemental insurers to sell you coverage that fills gaps in Medicare. Only four states require insurers to sell coverage, New York, Connecticut, Massachusetts and Maine.
Here’s more from Just Care:
- Four things to think about when choosing a plan to fill gaps in Medicare
- Four things to think about when choosing between traditional Medicare and Medicare Advantage plans
- Ten ways Medicare Advantage plans differ from traditional Medicare
- The wrong choice of Medicare Advantage plan could kill you
- The Medicare Advantage scam and beyond
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