Yves here. Even though many people look forward to getting on Medicare as an improvement over having no insurance or high-cost, high deductible Obamacare plans, don’t talk yourself into thinking it is good. It is an unduly complex, partly privatized system that still costs too much compared to government health care programs in pretty much any other advanced economy. Even Thailand has high quality medical care that is free to patients (citizens can pay more for “private” hospitals, which are more plush but the MD training and care standards are the same as for regular care; Thailand makes a point about uniformity of education and treatment).
And Medicare Advantage is worse. It lures customers in with one-stop shopping and apparent lower costs, which it delivers only via having higher deductibles and co-pays plus narrow networks. My mother, who is basically very healthy (on only one prescription at 93) has had over $30,000 of not covered expenses in her Medicare Advantage plan this year.
Put it another way: if you watch old people’s TV, you’ll see almost as many Medicare Advantage plan commercials as you do for prescription drugs. That should give you an idea of the profit margin.
One reader has been in an uproar about New York City’s plan to force retired workers into Medicare Advantage plans. It turns out he is far from alone. Not only are many retired union members opting out, even mayoral nominee Eric Adams has said he’s opposed and seeking to extend the deadline. Two suits are also challenging the scheme, one by union members. The sponsors aren’t helping themselves with help lines that are regularly dispensing vague, contradictory, and flat out wrong information.
Frankly, the “partial” list of Medicare Advantage services that require prior authorizations is enough to ring alarm bells. Hospital admissions? Really? You are hit by a bus or have appendicitis but you are supposed to get wait to get approval before going to the ER, since that might (probably!) will lead to an admission? MRIs? Who has MRIs for fun? Physical therapy? This level of insurer gatekeeping is likely to ensure that this network stays small (doctors get standard Medicare reimbursements but face more admin costs dealing with this pre-approval nonsense) and is likely to get smaller (doctors who signed up will drop out).
And kudos to THE CITY, which played a big role in breaking and covering this story.
By Sam Mellins. Originally published at THE CITY on October 20, 2021
Droves of city government retirees are preparing to pay thousands annually to keep their existing health insurance rather than taking a chance on a new cost-cutting plan.
All of the city’s quarter-million retirees and their dependents will be automatically enrolled in the new health insurance program, known as the Retiree Health Alliance, unless they opt out by the end of October, under a deal struck by Mayor Bill de Blasio and municipal labor unions to save on spiraling health care costs.
Two lawsuits to be heard in court Wednesday — one filed by frustrated city government retirees — seek to block the move.
The switch to the Alliance, a partnership created by EmblemHealth and Empire Blue Cross Blue Shield, is set to take effect Jan. 1. It moves retirees from traditional government-administered Medicare into a privately run system known as Medicare Advantage.
For the first time, retired city workers will have to obtain prior authorization from their insurer for a host of procedures and equipment, instead of getting coverage automatically.
Since New York Focus and THE CITY broke the news of the planned shift in April, retirees have voiced concerns that the new plan will saddle them with barriers to care, smaller networks and higher out-of-pocket costs.
They say they haven’t received assurances that all aspects of their care will be covered under the new plan — even after repeated calls to a hotline set up by the Alliance. Those with health problems that require expensive treatments are especially worried.
In an online survey conducted by the Organization of Public Service Retirees, a group formed in opposition to the Medicare Advantage proposal, 226 of 880 respondents said that they had called the hotline and been given incomplete or inaccurate information. Some 148 said they had called multiple times and been given contradictory information. Only 30 respondents said that they had been given clear and accurate information.
“I’ve called at least five to ten times and nobody knew what to tell me,” said Lainie Kitt, who worked for the New York City Housing Authority for 30 years, and is currently being treated for mycosis fungoides, a form of lymphoma.
“I get a different answer every time.”
‘Bait and Switch’
Municipal retirees are currently insured by Medicare, the federal government’s program for people who are over 65 or disabled. The city also provides a premium-free “Medigap” plan that pays for additional costs that would otherwise be billed to patients.
The planned switch is the result of a 2014 agreement between de Blasio and the Municipal Labor Committee, a group of unions that represent city employees and retirees. The unions committed to $1.3 billion in annual health care savings in exchange for pay raises for members.
City officials contend moving retirees’ health care to Medicare Advantage plans managed by private insurers will save over $600 million annually, while preserving equally good care. While the cost of retirees’ current care is split between the city and the federal government, the new plan will be paid for by the federal government alone.
On Friday, Democratic mayoral nominee Eric Adams — a former NYPD officer who will see his own current health insurance impacted by the shift — called the move a “bait and switch,” and wants to extend the deadline for retirees to opt out, the Daily News reported.
“We’re going to take a close examination of this because it’s going to traumatize our retirees,” Adams promised.
Asked about Adams’ comments at a news conference on Monday, de Blasio responded that the plan is “very good and smart and fair.”
“The goal of this plan was very simple: provide as good or even better benefits, and protect the long term health of the health plan so our retirees would know it is there for them reliably for decades to come,” de Blasio said.
Opting Out
Retirees have two alternatives if they do not want to join the Alliance Medicare Advantage plan: They can pay to keep an existing supplemental Medigap program known as Senior Care, or they can drop out of the city’s program entirely.
Senior Care, provided by EmblemHealth, has been free until now but will cost $191 a month for individuals, and twice that for couples, starting Jan. 1.
“It’s going to drain my husband’s pension,” said Tina Shapiro, whose spouse, a retired public school teacher, taught special needs physical education for 19 years. “It’s not going to be so easy for me to visit my children and my family,” she added.
Still, some retirees believe Senior Care could be cheaper than the free Medicare Advantage, if the new Advantage plan leaves them paying for treatment out of pocket.
Arnie Dansky, president of the Fraternal Order of Police Lodge 3100, which represents New York law enforcement retirees living in Florida, told New York Focus that hundreds of his members and other municipal retirees in Florida are opting out.
“Even though there is going to be a monthly cost, in the end it’s going to be cheaper,” Dansky said.
Kitt, the retired NYCHA worker, agreed. “I could be bankrupt from the other plan if they don’t take everything,” she said. “I can’t go with a plan that I’m not sure about.”
Some retirees fault union leaders for agreeing to the plan.
“The president of my local was on the Municipal Labor Committee board, and he okayed this,” Kitt said. “How could you do that to your retirees?”
Several major unions, including the United Federation of Teachers, DC37, Teamsters Local 237, Local 831, and the Police Benevolent Association, could not be reached or did not respond to requests for comment.
‘Very Generous Benefits’
Ana Champeny, director of city studies at the fiscally conservative budget watchdog Citizens Budget Commission, said that the city is presenting retirees with a “set of reasonable options where they can make the choices for themselves.”
“These are very generous benefits, even compared to other municipalities.” Champeny said. “These costs need to be reined in.”
Meanwhile, the Medicare Advantage move is the subject of two lawsuits seeking to prevent its implementation, both of which are being heard Wednesday in State Supreme Court in Manhattan.
One, filed by insurance giant Aetna, which submitted a bid for the contract that was awarded to the Alliance, claims that the Office of Labor Relations violated city procurement law in awarding the contract, and that EmblemHealth and Empire Blue Cross Blue Shield misrepresented their qualifications during the bidding process.
In a brief filed in response to the lawsuit, the Alliance denied “each and every allegation, statement, and matter” in Aetna’s suit.
A spokesperson for the Alliance declined to comment on the pending litigation, and did not address New York Focus’ questions on retirees’ concerns with the plan.
The second lawsuit, filed by the Organization of Public Service Retirees, argues that the plan violates retirees’ collective bargaining agreements with the city.
Doctor Uncertainty
Beyond cost, retirees cite a smaller network of doctors and potential barriers to care as more reasons they’re wary of the new plan.
The size of the network covered under the Alliance’s plan is significantly smaller than retirees’ current offerings: the Alliance said it includes 640,000 providers nationwide, compared to the 850,000 who participate in traditional Medicare.
Several retirees told New York Focus that their providers have indicated they will avoid dealing with the new Medicare Advantage program. Alan Odze, a retired NYPD officer and 9/11 first responder, who submitted an affidavit in support of the retirees’ lawsuit, said the office of the doctor who treats his melanoma told him they will not accept the Alliance plan.
The city has disputed this claim, and said in its response to the retiree organization’s lawsuit that the doctor, Paul Finger, has contracted to be in-network under the Alliance’s plan.
Asked by phone last week whether Finger’s practice would accept the Alliance plan, a representative of the practice responded: “We don’t know enough about it right now to answer that question.”
“The one thing I can tell you is that people are nervous about it,” the representative said. “We are getting lots of calls regarding it.”
Of the 880 retirees who responded to the Organization of Public Service Retirees’ survey, 46.2% said that at least some of their doctors told them either that they will not accept the Alliance’s plan or that they had not heard of it. Just 2.5% said that their providers would accept the plan.
City officials say more providers will join the network after implementation, once they see that the Alliance reimburses providers at the same rate as Medicare. “Once out-of network doctors understand the new program, they will accept direct payment and many will join the network,” Claire Levitt, deputy commissioner of the City’s Office of Labor Relations, said in an affidavit responding to one of the lawsuits.
Brown University School of Public Health professor David Meyers said that’s not a given, since each new health plan brings new headaches for doctors’ offices. “Paperwork can be an enormous burden for providers, and the more plans a provider is in-network for, the greater that administrative burden would be,” he said.
The Alliance also claims that retirees would be able to access care at no additional cost even if their preferred providers are not in-network. That’s because, the Alliance says, it will reimburse any doctor who is a Medicare provider at the same rates as Medicare.
But in an affidavit, Kimberly Parker, an administrator of the city’s health plans, acknowledged that it’s “theoretically possible” that a provider would decline to accept payment from the Alliance. In that case, retirees would have to pay their providers out-of-pocket and submit claims for reimbursements to the Alliance.
Dianne Archer, president of informational health site Just Care, said that this process could impede retirees from getting needed care. “Health care bills can be astronomical. Members might not have the means to pay up front for their care,” she said.
‘For The Rest of Your Life’
Retirees are also concerned that the Alliance’s plan requires that doctors get case-by-case approval for the Alliance to cover various categories of treatment, a process known as prior authorization.
A partial list of services that will require prior authorization, published by the Alliance, includes knee and hip replacements, occupational therapy, pain management, physical therapy, tonsillectomies, CT scans, echocardiograms, MRI, day hospital admissions, inpatient admissions, and intensive outpatient therapy.
A document published by the Alliance says that in-network providers are required to request prior authorization in order to receive payment for some types of care, and that if they do not do so, they are not permitted to bill patients for the cost of their care.
However, out-of-network providers are not required to request prior authorization before administering treatment. If requests submitted after treatment are denied, out-of-network providers are allowed to charge patients the full cost of their treatments.
“There’s no telling how many people…will not understand that their out-of-network providers should request prior authorization and will be responsible for the full cost of their care,” Archer said.
Between the potentially smaller networks, higher costs and barriers to service, some retirees feel that their trust in the city during their careers was misplaced.
“They told me: ‘You will have your benefits for the rest of your life,’” Kitt said. “So now, I’m not happy.”
This story was originally published by THE CITY, an independent, nonprofit news organization dedicated to hard-hitting reporting that serves the people of New York.
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Medicare Advantage plans are ideal…if you are in perfect health, and will never need the service of a medical professional or hospital for the rest of your life.
At one point, health plans only had deductibles. Now there are an ever expanding and bewildering array of co-pays, and co-insurance as well.
Of course, that is not to be confused with not getting reimbursed for a particular drug or treatment, because you have not gone through the algorithm of cheaper alternative treatments (as opposed to just not being covered for a particular drug or treatment). Not all algorithms, not all the time, are unreasonable. Although many times the circumstances show them for what they are – merely a money saving scheme that has nothing to do with assuring a better health outcome. And what can happen is that an Advantage recipient will change plans due to rate increases, changes to the formulary that the plan covers, or the discovery that the plan is simply terrible. Upon enrolling in the new plan, many times the recipient has to adhere to the new plans algorithm (which, OF COURSE, almost always happens for any treatment that is expensive). Now, I’m not a lawyer, so I don’t want to say the new plan is under no legal obligation to consider* all the rigamarole the recipient endured in the previous plan to finally reach the more expensive, but effective treatment. I just know that people come to HICAP and complain about such circumstances, and that the appeals process is long, convoluted, and by the end of this process the recipient’s effective treatment is delayed for substantial amounts of time. Legal action would be even more arduous, and would be expensive. As far as I can ascertain, there is no actual disincentive for health insurance companies to behave this way.
We all end up dead sooner or later, but you dying before medical treatments can be made only advantages the insurance company.
As far as the medicare advantage dental, eyecare, and hearing plans, the vast majority only truly cover the exams. Deductibles for serious dental work can be thousands of dollars, as well as for hearing aids.
* consider “Considering” is a good thing to do. But there is also paralysis through analysis. And if time is money, whose bank account is increased by delay…
Yes. Time is Money. And the beginning of Open Enrollment was October 15. Whether you have an Advantage Plan or a Medigap Plan you will be spending hours and hours reading Plan contracts that are semi-deceptive as you try to develop the necessary CLAIRVOYANCE for your future medical needs. And that ignores the time reviewing Part D medicare drug plans to see if their formulary (tier 1 drugs) has changed and whether it will match your currently unknown need for future medication.
And after you make a selection you, of course, will need to get on the phone with a certified agent. But first you will endure an incomprehensible phone tree interrogation and a pre-screening by a person who knows very little about these medical plans and will be unable to answer your detailed questions. I’ve already endured one 40 minute “Hold”, before succumbing to exasperation and the disconnect tone.
This is an annual experience, my friends! Don’t for a minute believe that Medicare 4 All is equivalent to single payer/national healthcare.
Medicare Advantage plans are highly marketed – like timeshares. This should tell you everything you need to know.
Preach it! I’m not even 64, and I’m already in the crosshairs of these marketeers.
Probably three quarters of my mail has been Medicare Advantage plan marketing since I became eligible to enroll. I had gotten a lot prior to that but once I could sign on the dotted line, the major vendors must have decided I would forget their name if I didn’t get a letter or flyer every other day. Must be a condition of turning 65.
I’m in a Medicare Advantage plan – with Kaiser Permanente [Mid-Atlantic region]. I am happy with it. Is KP better than most – which is what they say, citing patient satisfaction surveys – or am I simply unaware of the troubles that may await me when/if I get really sick?
A dear friend was on the Kaiser Advantage plan. His heart stopped and started again. He went to a hospital 5 minutes away and they diagnosed heart block. He should have had a defibrillator or pacemaker installed.
Kaiser refused to authorize a cardiac evaluation and said the next appointment would be 3 months away. He had a cardiac arrest 3 weeks later and died at age 68.
Anthem discontinued my Medicare D drug plan and is trying to push me on to one of their Advantage plans. No way. I’m changing insurers.
Kaiser is fine if you are healthy. If you develop serious health issues Kaiser is a poor choice as your friend discovered.
If you choose Kaiser you have no choice but Medicare Advantage plans.
The velvet glove has been replaced by a calving glove ( Working is SF during the 80’s was educational).
I have a Medicare Advantage plan with no additional premium and for the moment it serves me well. I’m mostly healthy and only need two prescriptions, which are cheap generics.
However, as soon as I take advantage of some of the additional benefits (new glasses, basic dental work) not offered by original Medicare I intend to switch to back to the original and buy a Medigap policy.
Fortunately, in Alabama, the network is large since other companies have to compete with Blue Cross, Blue Shield which is the 900 pound gorilla and has most doctors and hospitals in their network.
(Yves, please correct me if I’m wrong.)
Hi –
Switching to a medigap plan from Advantage is possible but can be complicated.
https://www.medicare.gov/supplements-other-insurance/when-can-i-buy-medigap/guaranteed-issue-rights
The trick is to use your “trial right” within the first year – you don’t want to end up in a situation where the Medigap providers and deny you coverage.
John Zelnicker
October 21, 2021 at 10:44 am
https://www.medicare.gov/supplements-other-insurance/whats-medicare-supplement-insurance-medigap
I don’t know why (unless CMS has become so corrupt its in the pocket of health insurance companies), but the Medicare site states:
6. Any standardized Medigap policy is guaranteed renewable even if you have health problems. This means the insurance company can’t cancel your Medigap policy as long as you pay the premium.
As they know about guraranteed renewable, it is strange that they don’t mention guarantee issue
This link, IMHO, explains in detail medigap, but manages to TOTALLY OBFUSCATE the guarantee issue…uh, issue. For most people in most situations, you have your first initial year of Medicare eligibility to switch from a Medicare Advantage plan to Original Medicare. NOW, it is possible that a private insurer will sell you a medigap plan (generally only if you meet their health screening criteria), but they are not LEGALLY OBLIGATED TO. They can also sell the plan at a higher rate.
https://www.medicare.gov/supplements-other-insurance/when-can-i-buy-medigap/guaranteed-issue-rights
I believe this site provides a much clearer explanation of guarantee issue of medigap policies
https://www.medicareinteractive.org/get-answers/medicare-health-coverage-options/supplemental-insurance-for-original-medicare-medigaps/medigap-purchasing-details-enrollment-periods-guaranteed-issue-and-more
@fresno dan
October 21, 2021 at 2:06 pm
——-
Thanks for the info. I’ll save the links for later reading.
Looks like I’d better switch soon while I’m still relatively healthy.
Hay, can not Medicare Advantage people join the griping party? It’s not like the Corporate Policies are any better. Each year, they find new avenues of complexity and cost cutting. This year’s drinking word is “Deductible Exclusions”. These are expenses that don’t count towards your deductibles. And do you know what is excluded from your deductible? Corvid screenings. I have heard stories where screenings can cost form $100 to $300 dollars a pop. For a standard family of five, that is a good chunk of your deductible. Not any more.
Another trend I am observing is “Empowered Management.” “You are in charge of your own account.” What it really means is they are farming out some of the logistics management to your phone app. So now its up to YOU to insure your doctor is in network or not, among other tasks. It’s a huge TAX ON TIME and failing to stay on top of it can mean huge expenses. This appears to be the industries solution to surprise billing bans. Simply add the surprise bills to your personal management app for you to deal with.
Tele-medicine is another trend. Use an app on your phone to talk to a doctor and receive a diagnosis.
You get tested to find out whether or not you’re a crow? :)
Can I be a guest at that party? I was very fortunate both in having employer insurance for most of my working years, and in rarely needing it, but I HATE health insurance companies. Working as a contractor for a few years just strengthened that feeling, so when I reached 65 there was no way I was going to get a Medicare Disadvantage plan. Now I’m facing the possibility that politicians will destroy traditional Medicare and dump me in with every other person who is under the heel of the giant corporations. It’s infuriating.
Phil here. On the Kansas side of the state line (Kansas City SMSA straddles the KS-MO border) sits my 83-year-old brother-in-law who was admitted to a skilled nursing facility only last month after years of independent living. His physical health and mental capabilities are in an ever-accelerating rate of decline. The financial affairs officer of this facility advised me to get him off of his Humana Plan and onto regular old part B Medicare. She knows something.
I am 65 and have Medicare Part A, but I also have a Kansas state job with excellent benefits, including health insurance that is only $95.00/month, about fifty bucks cheaper than Part B or any of its substitutes. Not retiring anytime soon, maybe three years from now, but likely I will go with regular Medicare B. I am in good health, but I can’t anticipate being in good health forever. I don’t need fair-weather insurance.
Hint: when you retire, look for the KS SEHP State Retirees Senior Plan C, not the Part C plans – Senior Part C Mplans are Advantage [sic] plans, the Senior Plan C plans are traditional Medicare plans. Gosh, ya think the national gov and insurance companies made the names confusing on purpose? / ;)
Shorter, a general comment for KS readers:
any state of KS retiree plan starting with Plan is a traditional Medicare plan. (C, G, etc.)
any state of KS retiree plan starting with Part is an Advantage [sic] plan.
The medical insurance industry, part of the medical industrial complex, is relentless. It has nothing to do with health care. Only with extraction. And it is as illogical as industrial agriculture. It will implode at some point when the underlying social benefit is completely destroyed. Exsanguinated. There’s no way “advantage medicare plans” can survive. The only way medical care can survive at all is to go single payer. A national health system. Aren’t we all just getting totally exhausted with this sadistic mistreatment?
Word is getting around. The latest Med. Advantage [sic] ads on TV hawking the “you may be entitled to” line includes the disclaimer “depending on your zip code.” / ha!
So the big fight is that these former union member s are now going to have to buy their own Medigap policy? I will feel your pain right after I get done writing my check to my Medigap insurer.
Again, I will come back to this. Bernie should have just tried to kill off the 20% co-pay instead of adding more benefits. My Medigap policy (pays 20%) costs more than Medicare portion that pays 80%.
Please read more carefully. They are forced into Medicare Advantage by default. They have to opt out. If they opt out they would need to buy Medigap to have comparable to former coverage.
The beef is about trying to foist Medicare Advantage on them and lying that it is as good as they had before.
Again, “they” cannot do this. Only the insured can change their Medicare policy.The union can no sooner change their Medicare policy without their permission than they can sign me up for Medicare Part D without my consent,
The union apparently negotiated a Medicare co-pay policy in the past and no longer wants to pay for that. The choice for these people is to either take the union’s MA plan or buy their own co-insurance policy like many of us do. And yes, it is expensive.
The “insured” is the city:
https://nypost.com/2021/09/27/retired-nyc-employees-sue-to-block-inferior-medicare-coverageretired-nyc-employees-sue-to-block-new-inferior-medicare-coverage/
More detail:
https://nypost.com/2021/09/19/aetna-sues-nyc-unions-over-tainted-medicare-contract/
I have friends who are in a ridiculously costly Medicare plan because it’s through Pfizer (they are former Pfizer employees). I don’t understand how this can be foisted on them but they have some sort of HSA-like savings that they would lose (like upper 5 figures) if they opt out.
Re: Thailand healthcare
Two things struck me when I went to one of the most expensive hospitals in the country:
1. It was like a 5-star hotel with a huge airy atrium, personalized assistance from the moment you walked in the door until you saw the doctor. I was only there for a day visit and I can only imagine what the rooms were like.
2. The doctors all seemed to have affiliations with state hospitals, IIRC the biographical data about them on the website even listed their primary hospitals. So you could have seen the same doctor for a fraction of the price as a foreign tourist.
I won’t even talk about the Bangkok Dental Hospital because you wouldn’t believe me. Vaguely science-fictional.
Ahhh..Thailand…some day, “when all of this is over” we shall return.
I been through this with my wife.
wife: Should we change the plan for my father?
me: no
wife: why?
me: What is your father’s kidney function?
wife: 25%
me: How much did we pay for your mothers dialysis for 4 years?
wife: nothing over the regular deductible.
me: If you think your father with diabetes, and chronic kidney disease will ever require dialysis then you don’t change a thing. No matter what you think it might save or give you compare it to a percentage of $70k/month and ask if it is a good deal.