Chory

Dr. Edward T. Chory

I am sure many of you, like me, are tired of all the television ads, junk mail, robocalls and emails extolling the virtues of Medicare Advantage plans: the dental care and vision benefits, SilverSneakers programs, etc., all with $0 or low monthly premiums.

It’s hard to know what is true and what’s not.

The annual Medicare enrollment period began in mid-October and will end Dec. 7. As I try to understand the pros and cons of all of my choices, I am close to overwhelmed. Whether made by “Broadway” Joe Namath, William (Capt. Kirk) Shatner or Jimmie J.J. “Dy-no-mite” Walker, many of the claims seem to be misleading.

In my efforts to educate myself in hopes of making good decisions, I have learned this is all not only confusing but still evolving.

According to Medicare.gov, “Medicare Advantage Plans, sometimes called ‘Part C’ or ‘MA Plans,’ are offered by Medicare-approved private companies that must follow rules set by Medicare.”

Medicare+Choice, or Medicare C, first became available in January 1999 as legislated in the Balanced Budget Act of 1997 after trial programs had been run in an effort to take advantage of the efficiencies of managed care.

Medicare+Choice was renamed Medicare Advantage in the 2003 Medicare Prescription Drug, Improvement and Modernization Act of 2003, which also introduced prescription drug coverage — Part D — with its infamous “doughnut hole,” or coverage gap, which Medicare.gov defines as “a temporary limit on what the drug plan will cover for drugs.”

Since that time, many insurance companies — seeing the opportunity to profit by offering health care coverage to the Medicare population — have learned how to increase enrollment and maximize profits.

Boon for insurers

The percentage of Medicare beneficiaries enrolled in Medicare Advantage plans is increasing more and more quickly, from 19% in 2007 to 48% in 2022, according to the Kaiser Family Foundation.

There are nearly 3,900 different Medicare Advantage plans nationwide. On average, there are 39 plans available in each county in the U.S. When I went on Medicare.gov, I found there are more than 70 Medicare Advantage plans available for residents of Lancaster County.

Medicare Advantage plans have proven to be lucrative for insurers.

The top 10 Medicare Advantage insurers cover more than two-thirds of the market. Eight of those 10 have been found to have submitted inflated bills to the government for reimbursement. Four of the top five have “faced federal lawsuits alleging that efforts to overdiagnose their customers crossed the line into fraud,” The New York Times reported last month.

Overall, insurance companies earn nearly twice as much from Medicare Advantage patients through government payouts than they do on individual and group insurance.

“The government pays Medicare Advantage insurers a set amount for each person who enrolls, with higher rates for sicker patients. And the insurers, among the largest and most prosperous American companies, have developed elaborate systems to make their patients appear as sick as possible, often without providing additional treatment, according to the lawsuits,” The New York Times explained. “As a result, a program devised to help lower health care spending has instead become substantially more costly than the traditional government program it was meant to improve.”

Comparing the options

I was motivated to write this column after reading Paula Span’s Nov. 5 New York Times column. She presented information to help people decide whether to choose traditional Medicare or Medicare Advantage.

Medicare Advantage plans provide better preventive services, such as annual wellness visits, vaccinations (shingles, pneumonia, flu, etc.) and gym memberships. Most also cap out-of-pocket expenses, emphasizing zero copays. Medicare Advantage plans typically limit choice of providers, operating like an HMO that requires you to get care in a prescribed network. Additional benefits that are emphasized in media pitches for Medicare Advantage include dental, vision and hearing care coverage, which can be a substantial benefit but in reality is frequently limited. It is important to know the scope of these benefits since, as Span wrote, most “Advantage enrollees who use these benefits still wind up paying most dental, vision or hearing costs out of pocket.”

The biggest “pro” for traditional Medicare is that there is no network, so choice of provider is not limited.

“Traditional Medicare beneficiaries also largely avoid the delays and frustrations of ‘prior authorization,’ ” Span noted.

This results in a significant difference in where patients are hospitalized, and which cancer centers or nursing homes are covered.

Span quoted a Brown University researcher, whose research team has found that Medicare Advantage beneficiaries are 10% less likely to enter the highest-quality hospitals; 4% to 8% less likely to be admitted to the highest-quality nursing homes; and half as likely to use the highest-rated cancer centers for complex cancer surgeries.

The biggest drawback of traditional Medicare is that out-of-pocket expenses are not capped and having a Medigap policy is strongly recommended. Full disclosure: My wife and I have Plan G, or Medicare supplement, policies.

The final important aspect to understand are the rules governing switching from one type of coverage to another, possibly the most confusing aspect of this important choice. It may seem easy, but there can be important consequences. Span highlighted one of the most important of those consequences: “Beneficiaries who leave traditional Medicare for Medicare Advantage plans give up those Medigap policies. If they later grow dissatisfied and want to return to traditional Medicare, insurers may deny their Medigap applications or charge high prices based on factors like pre-existing conditions.”

Being informed is so important, but the process of seeking information can be difficult and confusing. The best sources of unbiased information, free of potentially misleading sales pitches, can be found on Medicare.gov or by calling the toll-free number: 800-MEDICARE.

You also can call the Pennsylvania Medicare Education and Decision Insight program at 800-783-7067 from 8 a.m. to 4:45 p.m. weekdays (you may have less of a wait if you call early in the day).

Most of the information I reviewed agreed that for healthy people with limited medical care needs Medicare Advantage really does offer significant advantages.

But for patients with chronic health problems and more of a need for medical care, Medicare Advantage may be a disadvantage.

The majority of people with either Medicare Advantage or traditional Medicare report they are satisfied with their coverage. Nevertheless, as with all major financial decisions, let the buyer beware.

Dr. Edward T. Chory is a retired general surgery specialist in Lancaster.

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