Yves here. I know many readers won’t have to worry about Medicare for some time. Nevertheless, it is an important case study in crapification and sneaky gotcha terms. Frankly, I don’t understand why someone hasn’t gone after Medicare Advantage providers for advertising fraud. The ads regularly say that users can get “free” vision or dental coverage, when “no cost up to a cap” is not “free coverage.”
I have a beef with Medicare Advantage because my mother had to pay $30,000 to go to the only skilled nursing facility in the area that does actual rehab, as opposed to warehousing, and it wasn’t covered because not in her network (Medicare normally pays for up to 100 days of skilled nursing after a sufficiently long hospital stay). She also had to pay $1650 out of her hospital stay. So much for wonderful Medicare Advantage. At least my mother could afford being in a crap policy. She’s also lucky that she takes only one medication, an inhaler…and even then, her crappy plan reimburses only 60%.
And more generally, the notion of being limited to an HMO or PPO is completely wrongheaded and anti-patient, yet it’s become fundamental to how we do health care in the US.
By Phil Galewitz, Kaiser Health News Senior Correspondent, who covers Medicaid, Medicare, long-term care, hospitals and various state health issues. He has been on the health beat for more than two decades and is a former board member of the Association of Health Care Journalists. Originally published at Kaiser Health News
When Teresa Nolan Barensfeld turned 65 last year, she quickly decided on a private Medicare Advantage plan to cover her health expenses.
Barensfeld, a freelance editor from Chatham, New York, liked that it covered her medications, while her local hospitals and her primary care doctor were in the plan’s network. It also had a modest $31 monthly premium.
She said it was a bonus that the plan included dental, hearing and vision benefits, which traditional Medicare does not.
But Barensfeld, who works as a copy editor, missed some of the important fine print about her plan. It covers a maximum of $500 annually for care from out-of-network dentists, including her longtime provider. That means getting one crown or tending to a couple of cavities could leave her footing most of the bill. She was circumspect about the cap on dental coverage, saying, “I don’t expect that much for a $31 plan.”
Through television, social media, newspapers and mailings, tens of millions of Medicare beneficiaries are being inundated this month — as they are each autumn during the open enrollment period — by marketing from Medicare Advantage plans touting low costs and benefits not found with traditional Medicare. Dental, vision and hearing coverage are among the most advertised benefits.
Those services are also at the center of heated negotiations on Capitol Hill among Democrats as they seek to expand a number of social programs. Progressives, led by Sen. Bernie Sanders (I-Vt.), are pressing to add dental, vision and hearing benefits to traditional Medicare.
Despite the high-powered advertising of the Medicare Advantage plans pitched by the likes of celebrities Joe Namath and Jimmie Walker, beneficiaries still generally end up with significant out-of-pocket costs for many of these services, a recent study by KFF found. That’s partly because the private plans limit benefits. While people in traditional Medicare paid on average about $992 for dental care in 2018, those in Medicare Advantage plans paid $766, according to the study. For vision, people with traditional Medicare paid $242, compared with $194 for those covered by a Medicare Advantage plan.
“It stands to reason there would be lower out-of-pocket spending in Medicare Advantage than in traditional Medicare, but the differences are not as large as one might expect,” said Tricia Neuman, a senior vice president at KFF and executive director of its Medicare policy program.
More than 26 million people were enrolled in Medicare Advantage plans for this year — 42% of all Medicare beneficiaries. Enrollment in the private plans has doubled since 2012 and tripled since 2007. Unlike traditional Medicare, these private plans generally allow coverage through a limited network of doctors, hospitals and pharmacies.
Open enrollment for 2022 plans runs from Oct. 15 to Dec. 7, and some Advantage plans offer enticements such as hundreds of dollars’ worth of groceries, home-delivered meals or $1,000 in over-the-counter items such as adhesive bandages and aspirin.
But many seniors don’t realize there are restrictions on these benefits. They may cover extras only for enrollees with certain health conditions or have a narrow network of providers or annual dollar limits, often around $100 for vision or $1,300 for dental.
“All these extra benefits encourage people to sign up, but people don’t know what they have until they try to use it,” said Bonnie Burns, a training and policy specialist for California Health Advocates who helps Medicare beneficiaries evaluate their health plan options.
Seniors typically can choose from more than 30 Medicare Advantage plans sold by several insurers. The choice is so daunting that fewer than a third of seniors bother to shop and compare during the open enrollment window — even though costs and benefits change every year.
And for those who want to shop around, comparisons are not easy. The Medicare.gov website provides an overview of health plan costs and benefits and lets seniors compare plans’ premiums based on what medications the beneficiary uses. But it doesn’t offer a comparison of which doctors, dentists or hospitals are in the Medicare Advantage network or provide details about limits on dental, hearing and vision care. For that information, consumers must go to each insurer’s website and read through a summary of benefits that can be dozens of pages long.
Mary Beth Donahue, CEO of the Better Medicare Alliance, a research and trade group representing Medicare Advantage plans, sees things differently. “Medicare Advantage’s flexible benefit design means that beneficiaries can choose a plan tailored to their needs — whether that means more robust coverage, or more basic coverage, potentially for a lower cost,” she said.
Casey Schwarz, senior counsel for education and federal policy at the Medicare Rights Center in New York, an advocacy group for seniors, said the extra benefits offered by plans have increased confusion among beneficiaries. Those benefits come at a price.
“There is almost always a trade-off such as narrower provider networks, tighter drug formulary or restrictions in other areas,” she said.
Jenny Chumbley Hogue, an insurance broker near Dallas and an analyst at medicareresources.org, which helps seniors navigate the program, said marketing misleads some of her clients. “They see a TV ad that says they can get everything for free when they may not qualify for those benefits,” she said. “It’s hard to know if they are misinformed or not reading the fine print.”
She added that consumers should choose a plan based on whether their doctor is in that network or their drugs are covered at the lowest cost. For example, while most plans offer a hearing aid benefit, it’s usually only for a certain type of aid from a single company, Chumbley Hogue said.
“The devil is in the details, particularly when it comes to dental,” she said. “The coverage is not typically what they are used to coming from an employer plan.”
Medicare Advantage dental benefits are becoming more robust, though. Nearly 90% of the private plans offer dental benefits at no extra cost and most offer coverage for treatment as well as cleanings and checkups, according to a report by the consulting firm Milliman. The percentage of plans offering preventive and comprehensive dental has jumped to 71% this year from 48% in 2019.
Plans also are increasing benefits so they meet Medicare’s requirement to spend at least 85% of enrollees’ premium dollars on health services, Neuman said. Plans that don’t reach that threshold can face sanctions, including not being allowed to enroll new members.
While some consumers may find the dental benefit alluring, not everyone uses the coverage. The Medicare plan may not cover their existing dentist, so they continue to pay out-of-pocket, she said.
Medicare Advantage beneficiaries use their dental benefits less frequently than people with dental coverage through their employer, said Joanne Fontana, a principal with Milliman. “Not everyone buys a plan because it covers dental,” she said, “and it’s not top of mind or they [don’t] think to go the dentist every year.”
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There’s also a sleazy line telling people to “call and get the benefits that they deserve.” Hard to tell if it is meant ironically. Everything about the ads is ultra-sleaze. I wondered the same thing about fraudulent advertising. Also, who is paying for all these ads?
All of the advertisements tells me one thing. These Advantage plans are very profitable. I have traditional Medicare with a supplemental plan that covers most of the unpaid charges. The supplemental is provided by my former employer. Every fall they send applications to change to their Advantage plan offering. I of course file them in my waste can. My biggest fear is they will force people to join their Advantage plan. If they do , I will probably keep my traditional Medicare and purchase my own supplemental plan. It will probably cost me a lot but the cost is worth having the option of where I get my health care.
The trends in Medicare Advantage plans is alarming, especially true in my state of Oregon, where penetration is far greater in urban areas.
https://www.kff.org/medicare/issue-brief/medicare-advantage-in-2021-enrollment-update-and-key-trends/
In 2019, I trained to be a SHIBA (Senior Health Insurance Benefits Assistance) volunteer. SHIBAs help people navigate through the labyrinth of Medicare choices. Unfortunately, a crystal ball that predicts one’s health wouldn’t be helpful for the healthy Medicare beneficiary if that person’s finances limit them to “no premium” MA plans anyway.
The only hope for poor and very sick Medicare beneficiaries is to appeal to the Aging and Disability Resource Center, which can include some help with B premiums and possibly cost-sharing. Dual Medicare/Medicaid eligibility is uncommon and requires deep poverty, which most individuals don’t qualify for. (The income limit is $783 a month if single and $1,175 a month if married. The asset limit is $2,000 if single and $3,000 if married.)
Thus, the working poor who transition to Medicare often have no choice but opt for the no or low premium MA plan.
One of our efforts to serve Washington County beneficiaries included creating a spreadsheet that detailed the different benefits of the numerous MA plans, including links to physicians that were in network. We specifically listed network hospitals and were shocked to see hospitals whittled out by some lean plans just weeks before general enrollment was to start. Alarmed, I raised concerns about “surprise” billing in MA plans.
Nonetheless, marketing has been effective in this HMO dominated state, with Kaiser Permanente deeply rooted in delivering health to corporations and unions alike.
KP only sells MA. KP is all that I have experienced while living in OR as my husband worked decades there. It’s covering our retirement years until we reach the magic Medicare year in slightly over a year from now. At that time, I will be closely looking at traditional Medicare to replace our current coverage and will leave KP if the employee Medicare coverage is the same as what is sold on the market.
Having just helped a friend transition to Medicare after she retired from pubic schools, I learned a couple important things about options here.
First and foremost is that Oregon and Washington have teamed up toward bulk drug purchasing that offers cheaper drug coverage than any of the Medicare Part D plans. There’s no cost to get the significant rebates. It’s available to anyone of any age or income, including Medicare beneficiaries.
https://www.oregon.gov/oha/HPA/dsi-opdp/Pages/index.aspx
While I knew of Oregon’s Prescription Drug Program, I didn’t realize drugs were cheaper than through a prescription drug plan (which carries a monthly premium that generally includes a sizable deductible) until I plugged in my friend’s drugs! Like any prescription drug plan, it requires due diligence toward prescribing the exact generic prescription dosage and formulation to get the best price.
The other thing I learned was that her employer’s retirement plan was an amalgam of traditional and MA features that was more expensive than what she would be paying out-of-pocket for the best traditional Medicare premium and supplemental plan (again, that takes a lot of research which should be done EVERY year for the best price of the plan–e.g. Medigap G–offered in the state) and without purchasing a D plan.
Of course, this is unique to Oregon and Washington with the NW Prescription Drug Consortium.
https://www.hca.wa.gov/about-hca/prescription-drug-program/partners
Other states offer discounts for bulk purchasing, but I don’t know if they compare to the excellent program in OR/WA.
https://www.ncsl.org/research/health/bulk-purchasing-of-prescription-drugs.aspx
This should rankle NC readers to lobby their state lawmakers into creating a similar program since Congress isn’t going to tackle egregious drug pricing.
Kris, thanks so much for what you shared. I’m also in Oregon, and I’m going to share this info with my elderly parents.
Yes, they sound like hucksters. Glad you mentioned that.
“sleazy line telling people to “call and get the benefits that they deserve.”
Don’t forget what comes immediately next from these shameless hucksters: “it’s free!” No doubt “what’s free” is the phone call. So clever and so perfect for America.
@Skunk — you and every American pays for that advertising. And in return we get the most expensive, crappiest healthcare non-system in the developed world. Public health here is a joke, as those of us who didn’t already know it have certainly learned in the last two years. In terms of life expectancy, we are 46th in the world. That’s what those advertising dollars and our bought-and-sold Congress have purchased for the US citizenry.
the headline suggests that it’s medicare that screws you, not medicare disadvantage.
The headline was KHN’s. And traditional Medicare does not offer those trinkets to get you into a narrow network. If you listen at all closely to the horrific ads (to which I am now subject to having a 93 year old mother who listens to old person’s TV), you can tell they are Medicare Advantage.
Joe Namath probably makes more pitching Advantayge plans than hr did playing football.
Thank you for posting this. My mom has high medical bills that are totally covered by Medicare plus a supplemental BCBS plan that she pays an extra $250 a month for. This extra plan covers what Medicare doesn’t to 100% and there’s none of this out-of-network trickery, but it doesn’t cover her dental or vision or her prescription co-pays. On one of her hospital stays the bills several years back must have gone way into the hundreds of thousands of dollars at least (she was in the hospital for 2 months and had 2 major surgeries, a couple ICU stays, and a long stay in the intermediate care unit, on a breathing machine or trach almost the whole time), and there have been several other hospital stays of 1-2 weeks. So I have often been thankful she has this BCBS plan as we never saw a single bill.
Still, she sees these ads on TV and gets these calls from Medicare Advantage plan companies that promise big monthly savings. I always tell her that they are not doing this out of goodwill and that with her big medical bills, they wouldn’t be pushing these cheap plans on her if they didn’t think they would come out benefiting financially at her expense. I always manage to convince her to stay with what she has since it has definitely paid out, but just last night she was talking about calling a number she saw on a TV commercial. Apparently this one promises an annual cap in out-of-pocket payments at around $3k, but I don’t trust our ability to suss out whether this is accurate. I have lived out of the US for most of my adult life so it is extremely confusing to me. Anyway, my mom knows the system is a racket, so I don’t know why she keeps wanting to fall for this. I will tell her about this post tonight. Thanks again, this post came at just the right time.
What is BCBS? (Thank god, I never watch TV.)
Blue Cross Blue Shield. In places like Alabama, where Yves and her mother live, BCBS has a near-monopoly on private insurance prior to Medicare eligibility.
Or, as I like to call it, BC Bull[puckey].
I’ve been watching a lot of BUZZR (antenna tv channel, with old game shows) recently… mostly the 70s Match Game… Endless Medicare Advantage ads with the fine print so tiny that I (not quite medicare age yet) can’t even read it.
My eight year old TiVo Roamio records off air, and on playback, when a commercial break arrives, I press the SKIP button four times for four commercials, six times for six commercials, etc. Makes watching off-air MUCH less obnoxious. Also, check for the extra channels of your local PBS station; ours in Portland OR has a second grown-up channel of different PBS programs, a third kids-only, and a fourth which simulcasts the local NPR and the local jazz FM stations through the TV. Setting it up was easy, and recording world news for later playback is… informative.
I really have to chime in here and thank NC for covering this subject so well. I turn 65 the end of this year so I have been inundated with calls and mailings regarding plans. Several months ago I had asked some older friends what they had chosen as a medicare supplement and most had gone with an Advantage plan. But after reading the articles in NC on Medicare Advantage, particularly this one by Lambert, https://www.nakedcapitalism.com/2021/07/democrats-prepare-to-privatize-medicare-using-medicare-advantage-their-opening-wedge-new-york-unions.html, I decided to go with a Medigap plan. I eventually signed up for what they call the N plan with Cigna for $71 a month. I had contacted an agent to get several quotes, but eventually researched and found the Cigna plan on my own. It was way cheaper than the plans offered to me by the agent and had good reviews. Dealing with Medicare really is a jungle. I know most people my age are not as research savvy as myself so I can only imagine the amounts of money that most seniors are being over charged. Again, thanks to Yves, Lambert and NC for their shared knowledge and assistance.
Most people, including well educated, hav a difficult time understanding what a policy covers. In one paragraph it claims to cover something. Farther dow are exclusions that in effect eliminate coverage. We desperately need a one Peter system covering all from birth to death. It is funny that health insurance first was a carrot used by businesses. How things have changed. Another big problem in health care is the consolidation of health care providers into a few. Wher I live there are two providing care from the doctor level to the hospital. Both use the same business plan. I wonder when dental care will suffer the same fate? Probably when more people have dental insurance.
BCBS does hold monopoly power here in the Southeast. I never fell for the Medicare Advantage PR and have always stayed in traditional Medicare. I live in Florida. I have a supplement, too. I am grateful that I have decent health. Still, paying close to $400/month is highway robbery. Thanks for the read and comments.
It is also important to note that a medicare supplement plan can be underwritten. In Florida as I understand it, it is only guaranteed issue at the time you become eligible for Medicare Part B or when turning 65. As everyone has stated this is a very confusing process and you would need to confirm this information with your insurance agent or a qualified adviser. But an important factor to investigate. It may not be that easy to navigate from your Advantage plan (or as Ralph Nader calls it…..Disadvantage plan) to a traditional medicare supplement.
I’m in Mensa and I still can’t understand the meaning of the language in the Medicare Advantage plans (even though I’m in one for the gym benefits). So god help the average, tired, confused old person.
I live in Texas where with enough signatures you can get something on the ballot, and if the public votes “yes”, it goes into the State Constitution as an amendment. I’d like to propose the following:
“All advertisements received by a Texas residents by whatever means are incorporated into any contract signed subsequent to the advertisement by the resident and any organization that is being advertised. Further, all such advertisements take precedent over any language found in the contract signed by the resident.
This text of this amendment shall be the only instruction given by a judge to a jury in a Texas court as to the meaning of the amendment in any contract case based on this amendment, except that the instruction shall also include the sentence: “The contract and all advertisements which pertain to the matter of the contract shall be construed by the jury according to how the average person in Texas will understand them on this date”
The court of original jurisdiction for granting any restraining order in such a case shall be the Supreme Court of the State of Texas acting by written opinions signed by the justices and published by the Court before the order goes into effect. If the total number of days that all restraining orders combined in the case are in effect exceeds 120 days, the Supreme Court shall take no action on any other case until the case arising out of this Amendment in tried and a verdict rendered.”
Let the advertisers be responsible for what they say.
Folks, it ain’t just the money. The TIME spent annually scouring Medicare plans (of any type) for the “gotcha” clauses in the contract makes Open Enrollment a distressing time of the year. If you get through it alive, then you get to celebrate Thanksgiving!
It is impossible to be clairvoyant about your future health needs. A national single-payer healthcare system would be better.
It’s not just the time required but the energy required. The older we get, the less we have. Entropy wins in the end.
Keep in mind that Medicare is only relevant in the United States, unlike the National Health plans in Europe which include out of country coverage . So in addition to the very high cost of insurance and medications we also get a geographically limited coverage area. Another (bad) example of where we are “number 1”.
Ummm, the UK NHs doesn’t cover you in the USA. When I was working in the USA, I made sure that the plans covered, to a limited degree, I looked for repatriation flights coverage, to cover my personal non business travel. Now in the Medicare system I make sure that the Supplement plan I get covers, to 50k, not much I know but enough to get me home, health issues coverage when abroad on vacation.
Every encounter with so-called health care in the US feels like a mugging. Rentiers gotta rent I guess.
The trends in Medicare Advantage plans is alarming, especially true in my state of Oregon, where penetration is far greater in urban areas.
https://www.kff.org/medicare/issue-brief/medicare-advantage-in-2021-enrollment-update-and-key-trends/
In 2019, I trained to be a SHIBA (Senior Health Insurance Benefits Assistance) volunteer. SHIBAs help people navigate through the labyrinth of Medicare choices. Unfortunately, a crystal ball that predicts one’s health wouldn’t be helpful for the healthy Medicare beneficiary if that person’s finances limit them to “no premium” MA plans anyway.
The only hope for poor and very sick Medicare beneficiaries is to appeal to the Aging and Disability Resource Center, which can include some help with B premiums and possibly cost-sharing. Dual Medicare/Medicaid eligibility is uncommon and requires deep poverty, which most individuals don’t qualify for. (The income limit is $783 a month if single and $1,175 a month if married. The asset limit is $2,000 if single and $3,000 if married.)
Thus, the working poor who transition to Medicare often have no choice but opt for the no or low premium MA plan.
One of our efforts to serve Washington County beneficiaries included creating a spreadsheet that detailed the different benefits of the numerous MA plans, including links to physicians that were in network. We specifically listed network hospitals and were shocked to see hospitals whittled out by some lean plans just weeks before general enrollment was to start. Alarmed, I raised concerns about “surprise” billing in MA plans.
Nonetheless, marketing has been effective in this HMO dominated state, with Kaiser Permanente deeply rooted in delivering health to corporations and unions alike.
KP only sells MA. KP is all that I have experienced while living in OR as my husband worked decades there. It’s covering our retirement years until we reach the magic Medicare year in slightly over a year from now. At that time, I will be closely looking at traditional Medicare to replace our current coverage and will leave KP if the employee Medicare coverage is the same as what is sold on the market.
Having just helped a friend transition to Medicare after she retired from pubic schools, I learned a couple important things about options here.
First and foremost is that Oregon and Washington have teamed up toward bulk drug purchasing that offers cheaper drug coverage than any of the Medicare Part D plans. There’s no cost to get the significant rebates. It’s available to anyone of any age or income, including Medicare beneficiaries.
https://www.oregon.gov/oha/HPA/dsi-opdp/Pages/index.aspx
While I knew of Oregon’s Prescription Drug Program, I didn’t realize drugs were cheaper than through a prescription drug plan (which carries a monthly premium that generally includes a sizable deductible) until I plugged in my friend’s drugs! Like any prescription drug plan, it requires due diligence toward prescribing the exact generic prescription dosage and formulation to get the best price.
The other thing I learned was that her employer’s retirement plan was an amalgam of traditional and MA features that was more expensive than what she would be paying out-of-pocket for the best traditional Medicare premium and supplemental plan (again, that takes a lot of research which should be done EVERY year for the best price of the plan–e.g. Medigap G–offered in the state) and without purchasing a D plan.
Of course, this is unique to Oregon and Washington with the NW Prescription Drug Consortium.
https://www.hca.wa.gov/about-hca/prescription-drug-program/partners
Other states offer discounts for bulk purchasing, but I don’t know if they compare to the excellent program in OR/WA.
https://www.ncsl.org/research/health/bulk-purchasing-of-prescription-drugs.aspx
This should rankle NC readers to lobby their state lawmakers into creating a similar program since Congress isn’t going to tackle egregious drug pricing.
Thanks to Yves and all the considerate and thoughtful readers and commenters. As someone who is 72 and had four elderly family members die in the last few years, this subject is a horror and nightmare that revisits and revisits. My only contribution is in the form of a question, and I didn’t notice anyone else pointing this out, why has AARP joined the Advantage bandwagon in almost every frequent mailing that they send? By the way, they send frequent “renewal” membership notices no matter your status and/or month of renewal, hoping, I believe, that the elderly keep responding and sending in more renewal fees, again, regardless of status and/or month of renewal. But, I would have hoped AARP might have been the perfect consumer conscious venue to do a real researched and independent analysis for the membership they claim to represent. Yet, they always seem to be on the exact wrong side of issues. I believe I distinctly remember them being on the “no negotiating” price side when the Bush administration pushed the law forbidding government prescription price negotiation, and outlawing going to Canada for medicines –as if it was a third world country and the perscriptions were not made by the very same Pharma companies that supply the US. Maybe Consumer Reports could undertake an analysis of Advantage Plans since the government can’t be trusted to be thorough.
Please do whatever you can to stay away from VSP offered through Medicare Advantage vision add-on plan.
You have to stay within their network, where the providers mark up frames and lenses so that your out-of-packet cost is MSRP.
In a normal country, these practises would be unlawful.