By Thomas Goldsmith
Medicare enrollees can face hard decisions at this time of year when open enrollment for the federal health insurance program allows them to change plans in a variety of ways.
Advocates for older people in North Carolina are pointing out the places where changes are possible, along with potential pitfalls.
Medicare, the federal health-insurance program, is a notable benefit mostly for the 48 million Americans over 65 who have paid into the system throughout their working lives. (Another 9 million people with disabilities such as end-stage renal disease are covered by the program.)
It’s also a huge expense, taking up 15 percent of the federal budget and paying out more than $700 billion in benefits in 2017, according to the Henry J. Kaiser Family Foundation, which collects and analyzes data on the health care system. That’s the reason politicians perpetually keep an eye on the money in the Medicare, either to strengthen it, divert some of its cost to other purposes, or a combination of the two.
Nonpartisan entities like each state’s federally required State Health Insurance Information Programs, or SHIIP, work to make sure consumers get full information about a complicated set of options when enrolling or re-upping with Medicare.
“If there’s one mantra for the open enrollment season, it’s ‘review your options,’” counselors from the national Medicare Rights Center say in the nonprofit agency’s current publication “What You Need To Know About Fall Open Enrollment.”
People younger than 65 who haven’t put a lot of thought into Medicare can suddenly find it overwhelming as they learn about the advantages of the program, as well as the complicated set of choices they make when first taking part, then every year during open enrollment, from Oct. 15 until Dec. 7.
Watching for changes
Services under two key pieces of the 52-year-old Medicare program apparently won’t change next year: Medicare Part A pays for hospital care and Medicare Part B covers outpatient services and doctors’ bills. Part A comes without charge to people who have made contributions to the system, while Part B will cost $135.50 monthly in 2019, according to the Medicare Rights Center.
Medicare Part C, better known as Medicare Advantage, is still Medicare, but administered by private-sector insurance companies such as Humana and United HealthCare. Those companies get paid by the government on a per-customer, or capitated rate, to cover a broad range of needs for Medicare consumers.
It’s worth remembering that these Medicaid Advantage policies offer services which can differ from plan to plan, from year to year, and even from month to month.
In contrast, companies selling Medicare supplement policies, which pick up costs not covered by Medicare, are required by law to offer identical coverage.
In a new provision this year, people with Medicare Advantage coverage can make changes between Jan. 1 and March 31, instead of during the earlier open enrollment period. They’ll be able to change Medicare Advantage plans or switch to traditional Medicare, with or without prescription drug coverage.
Consumers have until Dec. 7 to make changes to their Medicare Part D or prescription drug coverage. Because Part D plan’s formularies, or lists of covered medications, can change every year, consumers should check to make sure their current plans still works for them. That’s right: A person who’s been taking a specific medication for years could find the drug suddenly removed from their plan’s formulary.
Too much to consider?
Confused? Consumers who feel overwhelmed about Medicare have plenty of company.
“There are so many variables attached to the decisions people have to make,” said Gina Upchurch, founding director of Senior PharmAssist, a Durham nonprofit that advises older residents about medication and insurance choices. “It’s becoming much more complicated and we worry about choice overload.”
Upchurch and Senior PharmAssist colleague Katie F. Huffman published a comprehensive article on the program early this year in the peer-reviewed Journal of the American Geriatrics Society. Journal editor Dr. Debra Saliba said in an accompanying editorial that making the right pick among Medicare choices can make significant differences in what enrollees spend and what care they can receive.
“These enrollment differences are only a small part of understanding the purchasing choices that Medicare beneficiaries face,” Saliba, a California geriatrician, wrote. “In addition to affecting healthcare directly, these choices can have significant financial and access implications for older adults.”
“We strongly recommend that everyone look at the Annual Notice of Change from their insurer and understand all of the changes to their plans if any,” said AARP North Carolina Director Doug Dickerson. “People should have received these notices by Sept. 30.”
A trend toward Medicare Advantage enrollment continues, with nearly one-third of all Medicare enrollees choosing the private option. That’s notably true in the population of employee-plan enrollees, known as Medicare Advantage employer group waiver plans, or MA-EGWPs that are offered by some companies to their retirees. In lieu of a retiree health plan, employers can, for example, pay administrative fees for these plans which might result in lower premiums for the retirees. According to health care analysts Mark Farrah Associates, the number of North Carolinians in these plans has grown from 129,959 in December 2015, to 177,884 in October, a 36 percent increase.
In May, the advocacy organizations Medicare Rights Center, the Center for Medicare Advocacy, and Justice in Aging successfully asked CMS to make changes to a publication that the groups said went too far in promoting Medicare Advantage. A tweet this week from the federal Centers for Medicare and Medicaid Services sent readers to a page that poses questions about whether traditional Medicare or Medicare Advantage will work better for them.
As advantages, CMS lists:
- Generally lower costs.
- Having a single source for health and drug coverage.
- Extra benefits such as gym memberships and basic dental and vision care. (Counselors say these benefits are a prime driver of Medicare Advantage enrollment.)
- A limit on out-of-pocket spending for covered services.
CMS also lists disadvantages, or “things to consider” about Medicare Advantage:
- The requirement to pay separately for coverage in addition to paying for Part B, or doctor’s office coverage.
- The requirement to use doctors and hospitals that are part of the company network. That means that people who travel a lot probably should not sign up for Medicare Advantage. Also, people who want to stay with their providers should check to make sure that each accepts Medicare Advantage.
- In a feature familiar to people who have been on preferred provider organizations, consumers who want to see a specialist may have to have that coverage approved in advance.
“Pay the entire bill”
People making the decision on plans should listen for potentially misleading pitches such as, “You can go to any doctor who accepts Medicare Advantage.” Consumers are advised to ask whether their doctors and/or hospitals accept Medicare Advantage. It’s true that any doctor can accept Medicare Advantage, but many do not, electing not to take part in networks of providers and hospital affiliated with the program.
“With commercial Medicare Advantage plans, you have got to go see their providers, or you pay the entire bill,” Upchurch said. “And the networks are set up by counties.”
Actually, quite a few services that new enrollees might expect are not part of traditional Medicare Parts A and B.
An AARP study this year found that nearly 60 percent of respondents incorrectly thought Medicare paid for long-term nursing-home care, while 52 percent had the same incorrect belief about assisted-living stays.
Other services not covered by traditional Medicare include “routine dental care, vision care or eyeglasses, or hearing aids.” Also in that category: care required during travel abroad or cosmetic treatment.
Source: “The Health of Older Americans: A Primer on Medicare and a Local Perspective,” Journal of Geriatric Studies, January 2018.