A new KFF report reveals the enormous range in out-of-pocket limits for people in Medicare Advantage plans, depending upon the state they live in. New Yorkers and New Jerseyans face limits over $8,300 on average, while Californians have limits of just over $2,000. Medicare is a national program that should treat its enrollees equally, but insurers in Medicare Advantage discriminate in their offerings based on where you live.
The KFF report looks at annual out-of-pocket limits for the 21 million or so people enrolling individually in Medicare Advantage plans and finds the national average to be $5,421. It does not reveal limits for people enrolled in Medicare Advantage retiree plans through their employers. But, it shows very clearly that insurers create far larger financial barriers to care in some states than in others.
Of the 21 million individuals studied, 2.8 million have annual out-of-pocket limits under $3,000, with 1.1 million of them having caps of $1,000 or less. We don’t know from the report which insurers are offering these low out-of-pocket limits or why. Insurers maximize profits when they create high financial barriers to care, which keep people from get needed services.
More than four million people in Medicare Advantage have annual out-of-pocket limits over $7,000. Again, we don’t know who they are, but they are likely the New Yorkers and New Jerseyans who, on average, have high out-of-pocket limits. These high limits likely keep many of them from getting the care they need.
Congress should not allow insurers to create huge financial impediments to care for some individuals and not for others. Rather, it should require insurers to set the same out-of-pocket limit for all their enrollees. The government pays insurers offering Medicare Advantage plans different amounts based on the populations they serve, more in some states and communities than others and more for sicker enrollees. But, overall, insurers have hundreds of extra “rebate” dollars they could use to bring down out-of-pocket limits, if they so chose.
Here’s more from Just Care:
- OIG-finds-Medicare-Advantage-continues-to-overcharge-government
- Trump administration bolsters Medicare Advantage insurer overpayments in 2027
- Health systems are pulling out of Medicare Advantage in droves
- UnitedHealth makes it harder to see specialists in Medicare Advantage
- Warning: You’ll never understand differences among Medicare Advantage plans
