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Field Work

Medicare Advantage Shopping: 10 Rules

Janet Mills is a veteran in the Medicare Advantage marketplace.

At Florida’s SHINE program for 13 years, Mills has provided unbiased counseling to thousands of seniors trying to make difficult choices about their Medicare coverage.  Now an area coordinator, she also fields questions from volunteer counselors at SHINE – the Serving the Health Insurance Needs of Elders program – in Pinellas and Pasco counties, which include St. Petersburg and Clearwater.

It can be difficult for retirees with multiple Medicare Advantage options to distinguish one plan’s benefits from another plan’s and pull the right one off the shelf. But based on her experience, Mills said, the decision retirees make during open enrollment for Medicare Advantage plans is crucial to controlling their health care costs. One in three Medicare beneficiaries is now enrolled in an Advantage plan, according to the Henry J. Kaiser Family Foundation. Their growing appeal centers on premiums that are lower than Medigap premiums.  But retirees in Advantage plans also face the potential for up to $6,700 in out-of-pocket costs annually, the legal maximum allowed in the plans.  The out-of-pocket U.S. average is $5,219, according to Kaiser.

“You really don’t want to sleep through the annual enrollment period,” Mills said.

Here are her pearls of wisdom for those preparing to launch into their comparison shopping for Medicare Advantage plans, which go on sale Oct. 15: …
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Field Work

Medicare Advantage: Know the Pitfalls

Baby boomers on Medicare are streaming into Medicare Advantage plans, with nearly 18 million people currently enrolled in them.

But a new study identifies pitfalls that might not be obvious to those signing up.

Advantage plans are HMOs or PPOs that provide both basic Medicare Part B coverage and many of the benefits offered by supplementary Medigap insurance policies.  But Medicare beneficiaries’ premiums for an Advantage plan plus Medicare Part B coverage are roughly half, on average, of the premiums for a Medigap policy plus Part B.

One reason is that Medigap policies typically cover more out-of-pocket costs. Another is that insurers offering Advantage plans assemble networks of hospitals and physicians to control their costs and reduce customers’ premiums.

But, the researchers point out, Advantage plans frequently limit “access to certain providers and increase the cost for care obtained out-of-network.”

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In nearly half of the 20 U.S. counties examined in a new study by the Kaiser Family Foundation, Advantage plans had limited networks of hospitals, potentially increasing consumers’ costs. Further, a large majority of Advantage plans did not include their county’s top-quality, high-cost cancer treatment center in the networks of approved health care providers.

And it can be very difficult to compare access to care and the future out-of-pocket medical costs that will result from a decision to go with an Advantage plan. Costs vary greatly among Advantage plan networks, with coverage often described in complex, incomplete, or confusing insurance plan documents, Kaiser said.

Consumers also face a dizzying array of choices.  One example: In Cook County, which includes Chicago, eight difference insurance companies are selling 19 Advantage plans with 10 different provider networks.

Many retirees learn the ins and outs of the network only after they try to access medical care under the plan.  The Kaiser report’s key findings provide a roadmap of things consumer should watch for: …
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Behavior

Medicare Advantage Enrollment Doubles

Enrollment in the Medicare Advantage plans that private insurers offer as an alternative to traditional Medicare coverage has more than doubled over the past decade, the Kaiser Foundation reports.

The share of the Medicare population enrolled in these private plans is 30 percent, up from 13 percent in 2005, the non-profit foundation said.

The reason for this dramatic growth: Medicare Advantage became a better deal for older Americans in the wake of a 2003 increase in federal subsidies to insurance companies offering the plans.

The federal government subsidizes insurers through its reimbursements for the care they cover for older Americans enrolled in Medicare Advantage. Those payments were increased in 2003. Insurers responded by reducing beneficiaries’ copayments and cost-sharing in the plans and by providing medical services not always available to people who enroll directly in Medicare and purchase Medigap policies, said Gretchen Jacobson, an associate director of Kaiser’s Medicare policy program.

The extra services include gym memberships, eye glasses, dental care, and preventive medical care. To rein in their overall medical costs, Medicare Advantage plans restrict the hospitals and doctors that patients can use. …Learn More

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Field Work

Medicare Primer: Advantage or Medigap?

Traditional Medicare with a Medigap plan or Medicare Advantage? My Aunt Carol in Orlando wrestled with this decision for some five hours in sessions with her Medicare adviser, which she followed up with multiple phone calls – and a raft of additional questions.

“You have to ask these questions. You really have to think about it,” she said. “It’s confusing.”

Essentially every 65-year-old American enrolls in Medicare, and many get additional coverage. One form of additional coverage is through supplements to traditional Medicare, which include a Part D prescription drug plan and/or a Medigap private insurance plan to cover some or all of Medicare’s co-payments, deductibles, and other out-of-pocket costs. The other is through Medicare Advantage, a managed care option that typically provides prescription drug coverage and other services not included in the basic Medicare program.

So which to choose? Consumer choices have proliferated since private plans were added to Medicare 40 years ago. The typical beneficiary today has about 18 Medicare Advantage options, a multitude of Medigap plans for people who choose the traditional route, and 31 prescription drug programs, according to the Kaiser Family Foundation.

This primer is for new enrollees like my aunt. A future blog will provide suggestions from leading Medicare experts about ways to think about this important decision and the financial issues at stake.

The following compares the primary advantages and disadvantages of traditional Medicare and Medicare Advantage plans. But everyone is unique, and it’s impossible to simplify a process that requires each individual to research his or her best options, based on the severity of their health issues, their preferences and financial situation, and the policies available in their state’s insurance market. …Learn More

Field Work

Advantage Premiums Reflect Networks

Chart: Medicare premiumsA new study of Medicare Advantage plans in 20 U.S. counties found that plans with higher premiums generally offer broader networks of physicians to their customers.

“There are exceptions but there does seem to be a fairly clear relationship between how much plans are charging and the size of the network,” said Tricia Neuman, a Kaiser senior vice president and one of the study’s authors.

The correlation between premiums and network size is one finding in a rare study that tries to get a handle on the quality of Advantage plans around the country amid a scarcity of data on these plans. An earlier Kaiser study looked at how many of a county’s hospitals and top cancer treatment centers are available in Advantage plans.

Advantage plans are increasingly popular for good reason: they have lower premiums or offer more extras than enrolling in the traditional fee-for-service Medicare program and purchasing a Medigap supplement and Part D prescription drug policy.

They are able to offer lower premiums based, to some extent, on their ability to keep their costs under control, whether this is how much they’re paying to their physicians or to testing labs. But because there is very little data on what Advantage plans pay for medical services, Neuman said that it’s difficult to sort out what is driving the plans’ costs – and, in turn, the premiums customers pay.

However, others argue that an insurer’s degree of control over the costs of its medical providers depends on how much market power it has over the physicians it pays for services. The federal Medicare program, for example, has tremendous clout to set prices for medical services, because it controls a large segment of the demand for health care by elderly beneficiaries relative to the supply of physicians and other medical service providers. Research suggests that Advantage plans may partly control their costs by anchoring their payments to Medicare’s payment rates. However, narrowing the networks may be another way for Advantage plan insurers to gain market clout to control costs.

There is wide variation, from county to county, in the breadth of the physician networks. For example, most of the retirees in Advantage plans in Clark County (surrounding Las Vegas) and in Harris County (Houston) are enrolled in narrow networks. …Learn More

On the Web

Medicare Enrollment Help is Plentiful

Medicare posterOpen enrollment starts Oct. 15 for people who’ve signed up for Medicare and must buy into or change their supplemental Advantage or Part D prescription drug plans.

The Medicare Rights Center in New York tells me that you can “make as many changes as you need during this period” and that “only your last coverage choice will take effect Jan. 1.”

A long list of resources appears at the end of this blog to help Medicare beneficiaries through the enrollment process. But there’s a lot of hoopla around the Oct. 15-Dec. 7 enrollment period, so it’s important to know what Oct. 15 is not about.

One’s birthday – and not a date on the calendar – determines when people should initially enroll in the Medicare program. Most people turning 65 who are not covered by their own or their spouse’s employer health insurance at work are required to enroll in Medicare Parts A and B during a seven-month period that starts three months prior to their 65th birthday. During this seven-month window, new Medicare participants must also sign up for their Part D drug plans – or risk paying a lifelong penalty. Oct. 15 is not the trigger date for selecting Medigap plans either.

Here’s what the Medicare open enrollment that starts Oct. 15 is about: figuring out the right Advantage or Part D drug plan to buy or switch to. This is a complex process that involves multiple choices, anticipating your future health care needs and expenses, and a lot of research into the plans available.

It’s an implicit recognition of Medicare’s complexity that so many resources are available to help with this process, from private and government-funded consultants to YouTube videos and detailed web pages on the Medicare website. The following resources and blogs can help answer your questions: …Learn More

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Field Work

Medicare vs Medicaid in Nursing Homes

When a spouse or parent requires long-term care, quality is the top priority. But a report last year by the US Government Accountability Office (GAO) cited concerns about the quality of the federal data essential for monitoring the quality of care.  For example, three key indicators point to improvements: better nursing staff levels and clinical quality and fewer deficiencies in care that harm residents. Yet consumer complaints jumped 21 percent between 2005 and 2014, even though the number of nursing home beds has remained roughly flat in recent years.

Anthony Chicotel, an attorney with the San Francisco non-profit California Advocates for Nursing Home Reform, said care quality is intertwined with affordability, payment sources, and dramatic changes under way in nursing home economics.  For his views on this important topic, Squared Away interviewed Chicotel, who is also part of a national coalition of attorneys advocating for patient rights.

Question: Recent Boston Globe articles have highlighted substandard care at nursing home companies that allegedly sacrificed resident care quality for profits.  Are these a few bad actors or is this a larger problem?  

Problems exist in the traditional buyer-seller marketplace for nursing homes and long-term care services. Providers all get paid pretty much the same rate regardless of whether the care they provide is good or bad. It’s usually the government who’s paying, and they’ve got an imperfect monitoring system to make sure the rules are followed.

The bottom line is that dollars can be extracted from a for-profit facility that don’t go into patient care. What you sometimes see is a nursing home affiliated with a number of other companies that provide services to the nursing home at above-market rates. The same web of companies running the nursing home might be in charge of the linen supplies, medical equipment, therapy, and the above-market rents for the facilities. If they’re paying, say, $12,000 a month for linens instead of sending it to a non-affiliated company, and it costs only $7,000 per month to supply the linens, they’re making a $5,000 profit. I don’t think the government’s going to catch that or account for that money.

Q: Long-term care is so expensive – more than $6,000 per month, on average.  What are the top three financial issues that face nursing home patients and families? … Learn More

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Field Work

Free Help Navigating the Medicare Maze

Table: the FactsHICAP, SHIP, SHINE – whatever your state calls the program, the mission is an urgent one.

With some 10,000 baby boomers turning 65 every day, these programs help new enrollees grapple with their Medicare options and make decisions, especially during open enrollment, which begins on Thursday and ends Dec. 7.

Medicare is “confusing” to boomers, because they “have more than one option, and most of us, when we were working, had only the PPO or the HMO” to choose between, said Christina Dimas-Kahn, program manager and a telephone counselor in San Mateo County, California’s Health Insurance Counseling and Advocacy Program (HICAP).

The top requests for assistance coming into her office are from new enrollees to Medicare, followed by the elderly who can’t afford their medications, messy billing problems between Medicare and health providers, and questions about long-term care and how to pay for it, she said.

The primary goal is “education and empowering you to enroll yourself,” said Joshua Hodges, who oversees the programs for the U.S. Administration for Community Living (ACL), which funds them. Their “beneficiary focus” has become even more crucial, he said, since the advent of Advantage managed-care plans, which complicate the choices faced by Medicare beneficiaries.

Click here for a state-by-state directory of State Health Insurance Assistance Programs (or SHIPs) – their official name. SHIPs are also available to residents of Puerto Rico, Guam, the Virgin Islands, and Washington DC. …Learn More

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