Congress should level the playing field between traditional Medicare and Medicare Advantage

To protect people with Medicare and give them meaningful choice, Congress needs to level the playing field between traditional Medicare and Medicare Advantage. Unless traditional Medicare and Medicare Advantage offer the same benefits under the same terms, people cannot make a meaningful choice between them or protect themselves from Medicare Advantage plans that may threaten their health and safety.

In a previous post, I compiled information from the Office of the Inspector General (OIG), the Government Accountability Office (GAO) and the Centers for Medicare and Medicaid Services (CMS) revealing that some Medicare Advantage plans are threatening the health and safety of their members. But, we do not know specifically which Medicare Advantage plans remain a danger for people with Medicare. All we know is that CMS may award five-star ratings to ones it has found to jeopardize people’s health and safety, and MedPac currently finds these star ratings not trustworthy.

Yet, many people who want to leave their Medicare Advantage plans for traditional Medicare may not have that choice. A new Health Affairs paper by David Meyers et al., Brown University School of Public Health, reveals that people who want to leave their Medicare Advantage plan for traditional Medicare may not be able to buy supplemental coverage, Medigap, to fill coverage gaps. Because, unlike Medicare Advantage, traditional Medicare does not have an out-of-pocket cap, supplemental coverage is critical to protect people’s health and financial well-being.

The paper explains that people with higher health care needs are more likely to want to leave their Medicare Advantage plans. But, these same people are the ones least likely to be able to switch to traditional Medicare because it lacks a catastrophic cap and there is no guarantee they can buy supplemental coverage.

There are some federal protections that guarantee people the right to buy Medigap when they first enroll in Medicare and within one year of enrolling in a Medicare Advantage plan. But, other than during those times, in all but eight states, insurance companies selling Medigap coverage that fills gaps in Medicare can refuse to sell people this coverage or hike up premiums to the point that they are unaffordable.

The information from the Office of the Inspector General (OIG), the Government Accountability Office (GAO) and the Centers for Medicare and Medicaid Services (CMS) on the health and safety risk of Medicare Advantage plans is likely the tip of the iceberg. They have also found that more CMS oversight and audits of these plans is needed. Moreover, it appears that CMS has not been able to get Medicare Advantage plans to comply with federal regulations over several years.

To protect people with Medicare enrolled in Medicare Advantage, Congress should  take immediate action. It should impose a cap on out-of-pocket costs in traditional Medicare as well as ensure that Medigap plans are all community-rated and guaranteed issue.

Here’s more from Just Care:

• Ten ways Medicare Advantage plans differ from traditional Medicare
• Four things to think about when choosing between traditional Medicare and Medicare Advantage plans
• Why traditional Medicare remains so popular
• Seven things to do before you or someone you love leaves the hospital
• New study finds Medicare Advantage plan enrollees end up in lower quality nursing homes than people in traditional Medicare