JustCare

Tag: Medicare supplemental insurance

  • Medicare Part D drug costs rising

    Medicare Part D drug costs rising

    The private Medicare plan bait and switch continues. It wasn’t that long ago that copays in private plans were reasonable, affordable even, without Medicare supplemental insurance to pick up the cost. This year, Medicare Part D drug plans have moved from fixed copays to coinsurance, a percentage of the cost, for the majority of drugs they cover.  Consequently, out-of-pocket prescription drug costs are projected to rise again for people with Medicare.

    The advantage of traditional Medicare, beyond the wide choice of doctors and hospitals it offers anywhere in the country and easy access to care, has always been that it allows people to budget for their health care.  With supplemental insurance, there are few if any out-of-pocket costs. And, while supplemental coverage can be costly, knowing health care costs for the year gives people peace of mind.

    But, until Congress allows CMS to negotiate drug prices instead of permitting drug companies to charge astronomical prices, drug costs will continue to escalate for everyone.  For now, Congress has chosen to penalize the public and reward the drug industry since insurers have limited if any ability to rein in drug prices. To keep premiums down, they simply shift more costs to their members.

    The share of Medicare Part D drugs with coinsurance payments has been growing steadily in the last few years. According to Avalere Health, 58 percent of covered drugs in Part D plans now have a coinsurance payment. In 2014, about one in three drugs in Part D plans (35 percent) had coinsurance payments. Last year it was 45 percent.

    The Medicare Advantage plans are also shifting increasingly to coinsurance payments for certain drugs. This year 26 percent of their drugs have coinsurance payments.  You can expect that to increase.

    Here’s more from Just Care on prescription drugs:

  • Three big differences between a private Medicare fee-for-service plan and traditional Medicare

    Three big differences between a private Medicare fee-for-service plan and traditional Medicare

    Today, just as 50 years ago, when President Johnson signed Medicare into law, traditional Medicare is a fee-for-service program that allows older adults and people with disabilities to use almost any doctor or hospital in America knowing that Medicare will cover their care. Medicare Advantage Plans, including private Medicare fee-for-service plans, are newer Medicare health insurance options. All of these private Medicare Advantage plans are required to offer all the benefits that traditional Medicare offers. But, even the private fee-for-service plans work very differently from traditional Medicare.

    Of note, people with complex and costly conditions rate traditional Medicare substantially higher than the private Medicare plans on access and quality.  Not surprisingly, the overwhelming majority of people newly eligible for Medicare enroll in traditional Medicare. Here are three big differences between traditional Medicare and private Medicare fee-for-service plans that help explain the higher ratings and overwhelming preference for traditional Medicare:

    1. Many doctors and hospitals, which take traditional Medicare, may refuse to accept your private fee-for-service coverage. So, while private fee-for-service plans must pay for care from any doctor or hospital you choose to see, you may find that your doctors and hospitals do not accept the private fee-for-service plan’s rates. To make sure your providers will accept the plan’s rates and to avoid huge doctor bills, you should either use network providers or ask your plan for an “advance coverage determination” before seeing the doctor.
    2. Each Medicare private fee-for-service plan may have different approved doctor and hospital rates. Whereas traditional Medicare’s rates are transparent and identical within a geographic area, private fee-for-service plans are not. It is therefore near impossible to know what your out-of-pocket costs will be or to budget for your health care if you’re in a private fee-for-service plan and need to use out-of-network providers.
    3. Unlike traditional Medicare, you cannot buy supplemental coverage to fill gaps in a private fee-for-service plan. Private Medicare fee-for-service plans require you to pay annual deductibles and coinsurance (or copays) out-of-pocket, exposing you to financial risk if you need a lot of costly services. The plan must have a yearly limit on out-of-pocket costs, but it can be very high.

    Note that just because private fee-for-service plans must cover the same benefits as traditional Medicare does not mean that they will always cover the same services.  Private fee-for-service plans will apply their own rules for deciding whether a service is medically reasonable and necessary from traditional Medicare. For example, they might decide that a different number of trips to the doctor for a particular service is appropriate. That said, private fee-for-service plans might offer additional benefits such as eyeglasses or a vision test, benefits that traditional Medicare does not cover.

    For more information on the differences between traditional Medicare and private Medicare Advantage plans more generally, click here.