Before Rushing To Criticize Medicare Advantage Lets Take A Close Look At The Alternative
Medicare Advantage is increasingly under attack. Before throwing the baby out with the bathwater, … let’s take a look at some of the issues with fee-for-service Medicare.
getty
Over the last year, Medicare Advantage the publicly funded program that enables private insurers to manage health benefits for older adults and people with disabilitieshas come under the microscope. Policymakers, journalists, and health industry analysts are assessing the effect of the growing program on federal expenditure and quality of care.
As the CEO of not-for-profit Medicare Advantage plan, these are welcome assessments as the imperfect program has a host of shortcomings that are worthy of evaluation. Among these shortcomings are the system of risk adjustment that may be over-paying for the care of some patients the insidious use of utilization management practices to deny care to patients who need it and the use of dubious direct-to-consumer advertising that sometimes confuse and misdirect older adults.
Lost in some of the criticism of MA is an honest evaluation of the alternative: traditional Medicare, also known as Fee-For-Service Medicare. While FFS Medicare has served several generations of Americans well by providing them with broad access to a wide array of doctors offices and facilities, it is increasingly failing to meet its original mandate: to provide a cost-efficient safety net insurance system for older adults.
How FFS Medicare Works
What is the Alternative?
Fact : Medicare And Medigap Do Not Have Specific Networks
Neither Medicare nor Medigap plans have any specific networks that you must use. Medicare is a fee-for-service plan in other words, it is not a PPO or an HMO which requires adherence to a certain, predetermined network of doctors/hospitals.
Most doctors and medical facilities do, of course, accept Medicare. Most importantly, anywhere that Medicare is accepted, your Medigap plan will also be accepted. As the primary coverage, Medicare determines where you can use your plans. In other words, if you go to a doctor who does not accept Medicare, or file to Medicare, your Medigap plan will be useless.
The key, as a Medicare beneficiary, is seeing if your doctor/hospital, or any doctor/hospital you wish to use, accepts Medicare. If it accepts Medicare, then it is required to accept any Medigap company you choose .
Many people that we work with make the mistake of choosing a Medigap company based on what they perceive to be a broader name recognition or acceptance. And, that is just not a good variable to consider when it comes to Medigap companies. On the contrary, often the higher name recognition companies charge a higher premium for the exact same coverage. Doctor acceptance with Medicare and Medigap is identical from company to company.
What Are The Limitations Of Medicare Coverage For Polycystic Kidney Disease
You may end up with kidney failure due to PKD depending on your health. Medicare will cover kidney dialysis or a transplant, but you must be diagnosed with ESRD to receive this form of Medicare coverage. Your healthcare provider must refer you for treatment, and you must seek medical care from a Medicare-approved transplant or dialysis facility. With Medicares coverage of ESRD, age still doesnt matter in receiving coverage. You can get Medicare coverage if you meet Medicares specific requirements to qualify for health insurance.
Recommended Reading: How Do You Know If You Are Medicare Eligible
When Is The Best Time To Enroll In Medigap
Open enrollment is typically the best time to get a plan. This six-month period automatically starts the first month you have Medicare Part B and are 65 or older. During this period, you get what insurers call the preferred rate regardless of any pre-existing conditions you may have. Enroll outside this period and you may have to pay standard rates. Its also possible for your application to be rejected if you seek Medigap outside the open-enrollment period.
There are, however, special enrollment exceptions, and you may still qualify for Medigap without incurring hefty penalties. In these situations, an insurance company cant deny you a Medigap policy, place conditions or exclusions for pre-existing conditions, or charge you more for a Medigap policy because of a past or present health problem.5
Did You Know: If you live in Connecticut, Maine, Massachusetts, or New York, your Medigap options come with an extra level of security. These states must offer all Medicare beneficiaries ages 65 and older either continuous or annual guaranteed open enrollment. That means you cant be denied coverage due to your medical history.6
Suppose youre waiting to enroll in Medicare Part B and Medigap because you are currently working and have group health insurance coverage. In that case, you still have a penalty-free Medigap open-enrollment period past your 65th birthday, since open enrollment begins when the employers coverage ends when you retire, for example.
How Does Medicaid Provide Financial Assistance To Medicare Beneficiaries In Massachusetts
Many Medicare beneficiaries receive financial assistance through Medicaid with the cost of Medicare premiums, prescription drug expenses, and services Medicare doesnt cover such as long-term care.
Our guide to financial assistance for Medicare enrollees in Massachusetts includes overviews of these benefits, including long-term care coverage, Medicare Savings Programs, and eligibility guidelines for assistance.
You May Like: Does Medicare Cover Chiropractic X Rays
Medigap Statistics Compiled By The American Association For Medicare Supplement Insurance
Information shared here may be used with credit or acknowledgement to the American Association for Medicare Supplement Insurance. Links to our website are appreciated. Articles that link to our website will be promoted by the organization.
Reprinted from the 2019 Medicare Supplement Insurance industry conference program, published June 2019.
to access a PDF that you can download to your computer.
Sales of Medigap policies continue to increase year over year.
In 2018, some 14.1 million Americans owned a Medicare Supplement insurance policy.
That number represents an increase compared to the 9.7 million who owned a Medigap policy in 2010.
About Our Analysis And Methodology
For this analysis we used data licensed from the National Association of Insurance Commissioners . Specifically, we used the Medicare Supplement Exhibits for years 20162020. Per NAIC, innovative benefits are defined as those not available as part of the standardized Medicare supplement benefit design. Examples of new or innovative benefits may include, but are not limited to, the following services not already covered by Medicare and excluding prescription drug coverage:
Don’t Miss: Do I Need An Appointment To Sign Up For Medicare
Keeping Your Coverage If You Move
If you are moving to another county or state, make sure your Medicare plan will still be in effect after you move.
If you have original Medicare, federal rules usually allow you to keep your Medicare supplement policy. There are exceptions to this if you have a Medicare Select plan or if you have a plan that includes added benefits, such as vision coverage or discounts that were available only where you bought the plan.
If you have a Medicare Advantage plan, ask the plan whether its available in your new ZIP code. If the plan isnt available, youll have to get a new one. You can switch to another Medicare Advantage plan in your new area or to original Medicare.
A Snapshot Of Sources Of Coverage Among Medicare Beneficiaries In 2018
More than 62 million people, including 54 million older adults and 8 million younger adults with disabilities, rely on Medicare for their health insurance coverage. Medicare beneficiaries can choose to get their Medicare benefits through the traditional Medicare program, or they can enroll in a Medicare Advantage plan, such as a Medicare HMO or PPO. Medicare Advantage plans provide all benefits covered by Medicare Parts A and B, often provide supplemental benefits, such as dental and vision, and typically provide the Part D prescription drug benefit. Many traditional Medicare beneficiaries also rely on other sources of coverage to supplement their Medicare benefits. Supplemental insurance coverage typically covers some or all of Medicare Part A and Part B cost-sharing requirements and, in some instances, provides benefits not otherwise covered by Medicare. Beneficiaries can also enroll in a Part D plan for prescription drug coverage, either a stand-alone plan to supplement traditional Medicare or a Medicare Advantage plan that covers drugs.
Figure 1: In 2018, 9 In 10 Medicare Beneficiaries Either Had Traditional Medicare With Supplemental Coverage Or Were Enrolled In Medicare Advantage
Read Also: Where Do I Apply For Medicare Benefits
What Are The Costs Of Treating Polycystic Kidney Disease
Treating polycystic kidney disease can be pretty expensive. And when factoring in essential health care treatments, youll need to also factor in the expensive care costs. The typical cost to treat PKD for just four short months can range from around $7,800 $12,000 before any dialysis treatments or transplant costs! Thankfully, Medicare picks up a hefty chunk of change for those with kidney failure. Part A typically doesnt carry a monthly premium, but you will pay one with Part B coverage.
The monthly Part B premium is $164.90 each month. If your income is significantly higher, your premium may increase. Part B benefits also carry a deductible of $226 for the year and possibly any applicable co-pays. Youll also have a 20 percent coinsurance , while Medicare covers 80 percent. Medicare covers all services received in the hospital and doctors offices, labs, IV fluids, home dialysis training, and additional dialysis services.
Original Medicare: Key Takeaways
- Supplemental coverage can help prevent major expenses.
If youre approaching Medicare eligibility, youve probably heard about the various private-coverage options that are available to replace or supplement Medicare. These plans are popular, but are they necessary?
If you shun private coverage, can you get by on Original Medicare without purchasing supplemental coverage or using a Medicare Advantage plan?
The answer is: It depends.
Read Also: Can You Have A Health Savings Account With Medicare
Are Medigap And Medicare Advantage The Same
Although the names sound similar, Medicare Supplemental plans are not Medicare Advantage plans. Medicare Advantage plans are ways to get Medicare benefits, while a Medigap policy only supplements Original Medicare. If you have a Medicare Advantage Plan, its illegal for anyone to sell you a Medigap policy unless youre switching back to Original Medicare.3
From the Pros: Some Medicare Advantage plans cover extras, such as dental, vision, and prescriptions. If youre deciding between Medigap and Medicare Advantage, visit our Medigap and Medicare Advantage comparison guide.
Medigap Enrollment Among New Medicare Beneficiaries: How Many 65
Gretchen Jacobson,Tricia Neuman, andAnthony DamicoPublished: Apr 13, 2015
Over the past several years, policymakers have considered a variety of proposals to discourage or prohibit people on Medicare from purchasing first-dollar supplemental insurance, often in the context of deficit and debt reduction efforts. 1 On March 26, 2015, the House of Representatives passed H.R. 2, the Medicare Access and CHIP Reauthorization Act of 2015, which would replace the Sustainable Growth Rate formula, among other changes the bill is currently pending in the U.S. Senate. H.R. 2 includes a provision that would prohibit Medicare supplemental insurance policies from covering the Part B deductible for people who become eligible for Medicare on or after January 1, 2020.2 This provision is designed to make future Medigap purchasers more price-sensitive when it comes to medical care, which could lead to a reduction in the use of health services and Medicare spending. The Congressional Budget Office has estimated that the Medigap provision in H.R.2 would reduce federal spending by about $400 million between 2020 and 2025.3
This data note looks at the number and share of new Medicare beneficiaries who would be affected by the Medigap provision in H.R. 2, if it had been implemented in 2010, using the most current data sources available, and examines trends in Medigap enrollment among new beneficiaries since 2000.5
Key Findings
Discussion
Endnotes
Don’t Miss: When Do You Start Medicare Coverage
Helpful Resources For Texas Medicare Beneficiaries And Their Caregivers
Need help with your Medicare application in Texas, or have questions about Medicare eligibility in Texas? These resources provide free assistance and information.
- The Health Information, Counseling, and Advocacy Program , with any questions related to Medicare coverage in Texas. Visit the website or call 1-800-252-9240.The Texas Department of Insurance has a resources page for Texas residents with Medicare coverage.
Louise Norris is an individual health insurance broker who has been writing about health insurance and health reform since 2006. She has written dozens of opinions and educational pieces about the Affordable Care Act for healthinsurance.org. Her state health exchange updates are regularly cited by media who cover health reform and by other health insurance experts.
About our health insurance quote forms and phone lines
We do not sell insurance products, but this form will connect you with partners of healthinsurance.org who do sell insurance products. You may submit your information through this form, or call to speak directly with licensed enrollers who will provide advice specific to your situation. Read about your data and privacy.
With respect to Medicare: We do not offer every plan available in your area. Any information we provide is limited to those plans we do offer in your area. Please contact Medicare.gov or 1800 MEDICARE to get information on all of your options.
If you have questions or comments on this service, please contact us.
Fact : Medicare Is Primary To Medigap Coverage
Once you hit 65 or start on Medicare, Medicare will be your primary coverage. With Medicare as primary, the Medigap plan backs it up as a secondary payer. Medicare pays, in most cases, 80% of the Medicare-approved costs , and the Medigap plan pays, with most plans, the other 20% and some combination of the deductibles.
Medigap Plan F pays both of the Medicare deductibles and the remaining 20%, thereby filling in all the gaps in Medicare and being full coverage. Plan G which is the next step down, and usually is the best deal, pays all but the Medicare Part B deductible, which is $198/year . NOTE: For people who were first eligible for Medicare after 1/1/2020, Plan F is no longer available.
The way it works is that a doctors office files a claim to Medicare first, which pays that claim electronically. After Medicare pays, the Medigap plan pays as a secondary payer, after receiving the claim through the Medicare crossover system
You May Like: Does Medicare Pay For Entresto
Open Enrollment For People Age 65 And Older
The open enrollment period for Medicare supplement plans is a six-month period during which you may buy any Medicare supplement plan offered in Texas. During this period, companies must sell you a policy, even if you have health problems. The open enrollment period begins when you enroll in Medicare Part B. You must have both Medicare parts A and B to buy a Medicare supplement policy.
You can use your open enrollment rights more than once during this six-month period. For instance, you may change your mind about a policy you bought, cancel it, and buy any other Medicare supplement policy.
Although a company must sell you a policy during your open enrollment period, it may require a waiting period of up to six months before it starts covering your preexisting conditions.
Preexisting conditions are conditions for which you received treatment or medical advice from a doctor within the previous six months.
Tools Plans Can Use To Lower Costs
Companies that offer Medicare Part D coverage options can use a few tools to help keep prescription drug costs down for their enrollees. Tools such as prior authorization, step therapy, and quantity limits help keep costs down. They ensure that doctors arent just prescribing a more expensive brand-name drug when generic drugs will suffice.
Prior Authorization requires your healthcare provider to send a request explaining why the drug is necessary before the plan covers it.
Step Therapy requires the healthcare provider to try a less expensive prescription before a more expensive drug is covered.
Quantity Limits put a cap on how much of a specific drug you can receive between refills. Drugs affected by these tools can be found in the health plan information.
Recommended Reading: When To Sign Up For Medicare For First Time
Tell Me The Benefits Of Medigap
Medigap plans, or formerly called Medicare Supplements, sold from private corporations are available to cover some of the health care costs that Original Medicare cannot cover. Various Medicare plans also provide coverage for services the Original Medicare does not cover, including medical care for those traveling outside the US. Medicare pays the Part of the Part Medicare payment for covered benefits. The Medigap plan will pay the balance.
Summary: How Do Medicare And Medigap Work Together
Weekly, we talk to new clients who are astounded at how easy Medicare and Medigap insurance are. Most are familiar with the intricacies and hassles associated with under-65 insurance, or even group insurance. With Medicare and Medigap plans, the plans are designed to work together, do work together seamlessly and pay claims automatically through the crossover system.
_____________________ 65Medicare.org is a leading, independent Medicare insurance agency for people turning 65 and going on Medicare. We have worked with 10,000+ Medicare-eligible individuals over the last 10+ years, assisting with understanding and comparing the plans. You can get a list of Medigap quotes in your area. Or, if you have any questions about this information, you can contact us online or call us at 877.506.3378.
Don’t Miss: What Is Medicare Part B Deductible Mean
Medicare Health Insurance Options
In most areas of the country, Medicare beneficiaries can choose Original Medicare or a Medicare Advantage plan.
Original Medicare is provided directly by the federal government and includes Medicare Parts A and B. Medicare Part A, also called hospital insurance, helps to pay for inpatient stays at a hospital, skilled nursing facility, or hospice center.
Part B, also called medical insurance, helps pay for outpatient care like physician services, kidney dialysis, preventive care, durable medical equipment, etc.
Medicare Advantage plans are administered by private insurance companies that have contracts with the federal government. Medicare Advantage plans include all of the benefits of Original Medicare , and they typically have additional benefits, such coverage for prescription drugs, dental, and vision.
But provider networks are often limited with Medicare Advantage plans, and out-of-pocket costs are typically higher than a person would have if they opted for Original Medicare plus a Medigap plan. In short, there are pros and cons either way, and no one-size-fits-all solution.
Medicare beneficiaries can switch between Medicare Advantage enrollment and Original Medicare during the Medicare annual election period, which runs from October 15 to December 7 each year. Medicare Advantage enrollees also have the option to switch to a different Advantage plan or to Original Medicare during the Medicare Advantage open enrollment period, which runs from January 1 to March 31.
