Medicare

It’s that time of year when seniors are assaulted with all kinds of media ads for Medicare Advantage enrollment.

It is also the open enrollment period for Medicare, from October 15-December 7, when Medicare enrollees can change plans. Choosing a plan is always complicated but, if you gather good information, you can make an informed decision.

Less than half of seniors are enrolled in traditional Medicare. This plan has predictable costs and when coupled with a Medicare Supplemental policy will provide 100% coverage for hospital and outpatient care. Medicare coverage is comprehensive and traditional Medicare allows you to go to any health care provider in the country who is a Medicare provider. Almost all providers accept Medicare.

The annual fall Medicare Advantage media blitz is in full swing. Private insurance companies are raking in billions of dollars on the backs of unwitting seniors who think they are getting a good deal but in fact are being robbed of not only benefits but money.

Here’s the quick rundown. In 2003 it was decided that the private insurance industry should share in the profits of the government’s Medicare program. It was a calculated political move to privatize Medicare and eventually turn it into an entirely private insurance product.

Keep in mind that Medicare’s administrative expenses run at about 2 percent while private insurance company administrative costs run as high as 20 percent or more.

Americans who rely on Medicare for comprehensive health insurance are being assaulted by the forces of the American insurance industry. It’s nothing new. In 2003 the Medicare program was revamped and a new product, Medicare Advantage (MA), was created.

MA was created to privatize the Medicare insurance program and it is succeeding. People are lured in by low premiums and add-ons such as gym memberships and other lifestyle benefits. But MA is not the kind of insurance you want when you get sick. It works a lot like a managed care plan, meaning it is not portable from state to state and a lot of claims end up being denied that would have been easily accepted by traditional Medicare (TA).

Seniors continue to flock to enroll in Medicare Advantage plans. Most don’t know that they are helping to convert the program into just another private insurance plan. The insurance companies have been able to lure people in with low cost or no premiums and enticements that seem to good to be true.

There is a reason that the insurance industry advertising blitz has been so pervasive and relentless this year. Insurance companies are reaping higher profits from Medicare Advantage and, even though there is a high level of fraud and abuse, the companies committing these crimes simply pay fines and make it part of “just doing business”.

The Physicians for a National Health Program (PNHP) has been one of the few activist organizations working hard to educate the public about the threat to Medicare and to provide factual information about what is going on. They have launched a new effort to get the word out and I am extracting some of the more important points.

It’s bad enough that we are being subjected to a barrage of political ads as the mid-term election approaches. Those of us in the Medicare eligibility pool are also experiencing the yearly lust to enroll by private insurance companies hoping you will switch to a Medicare Advantage plan. Medicare pays them extremely well when people sign up for Advantage plans.

My simple advice is that if you are enrolled in traditional Medicare stay there. Consider switching back to traditional Medicare if you are in an Advantage plan. From October 15 until January 15, 2023 Medicare beneficiaries can switch Medicare plans.

Understanding all of the implications of types of Medicare plans can be difficult. If you look at some of the most important issues, such as cost, then decisions can be easier. Medicare Part A has no cost for most people. In 2023 the standard monthly premium for Medicare Part B will be $164.90 and the annual deductible will be $226.

The February 19 edition of the Vermont Business Magazine carried a piece written by Dawn Schneiderman, Vice President and Chief Operating Officer for Blue Cross and Blue Shield of Vermont, claiming that if Vermonters are allowed to enroll in Medicare supplemental plans after their initial six month eligibility period costs will rise for everyone else. She does a poor job of defending her position.

To make this issue real look at the current cost of a Vermont Medigap Blue Plan G policy for someone initially enrolling during the initial six month window. It will cost that person $152.33 a month. If that person wants to enroll in that same plan after the six month window it will cost them $268.91 for the same coverage under Vermont Blue 65 Plan G.

A few months ago I talked about a threat to the traditional Medicare program beyond the threat that Medicare Advantage poses to the public nature of the program. That threat is called Direct Contracting Entities (DCEs).

The Trump administration initiated the DCE change to push Medicare in the direction of privatization. That kind of move is going to chip away at the equality and near-universal access that Medicare offers because private insurance companies will be more in control of how health care is delivered and paid for.

Seniors are being bombarded with advertising for Medicare Advantage plans because the open enrollment period for Medicare is from October 15 to December 7. Insurance companies make piles of money if people switch from traditional Medicare to an Advantage plan.

The Advantage plans were created to move Medicare into the private marketplace and provide a financial windfall for the insurance companies.

They are good plans if you never get sick because the initial premiums are low and you get a few extra benefits not available in traditional Medicare.

But if you try to use the insurance in an Advantage plan you are subject to network restrictions and out of pocket expenses. It is not uncommon for a plan to have you pay $6000 out of pocket if you need care.

Every year during Medicare’s open enrollment period, which is from October 15 to December 7 this year, millions of Medicare beneficiaries are bombarded by private insurance companies looking for their business. The advertising makes it sound like these benevolent companies are looking to offer you a pot of gold for free. If it sounds too good to be true then it is too good to be true.

Here’s the story. In 1997 congress authorized the creation of Medicare C which has come to be known as Medicare Advantage. It was an effort by Republicans to privatize Medicare and make it less of a government-run program. It was also a gift for the private insurance industry which continues to haul in huge profits when people switch from traditional Medicare A to Medicare C.