Medicare Advantage Plans: Advantage? Really?
Any state, circumstance, opportunity, or means especially favorable to success, interest, or any desired end:
Benefit; gain; profit; superiority or ascendancy (often followed by over or of):
‘Tis the season of Medicare open enrollment.
Odds are, you’ve seen those Medicare Advantage TV commercials featuring the likes of William Shatner, George Foreman, Jimmie Walker and Joe Namath touting the “free” health insurance plans offering enticing benefits not available from so-called “Original Medicare” (also called “traditional Medicare”). But are they for real?
As an elder advocate for the last 48 years, I have experienced many government programs for the elderly. The most egregious program in my opinion is The Medicare Advantage Plan.
Through television, social media, newspapers and mailings, tens of millions of Medicare beneficiaries are being inundated — 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. While people in traditional Medicare paid on average about $992 for dental care in 2020, 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.
A client of mine recently related this story to me.
“Although Mom saw her MA premiums increase significantly over the years, she didn’t have any real motivation to disenroll until after she broke her hip and required skilled care in a nursing facility. After a few days, the nursing home administrator told her that if she stayed there, she would have to pay for everything out of her own pocket. Why? Because a utilization review nurse at her MA plan, who had never seen or examined her, decided that the care she was receiving was no longer ‘medically necessary.’ Because there are no commonly used criteria as to what constitutes medical necessity, insurers have wide discretion in determining what they will pay for and when they will stop paying for services like skilled nursing care by decreeing it ‘custodial.”1
A Medicare Advantage Plan, also called a Part C or an MA Plan, may sound enticing. It combines Medicare Part A (hospital insurance), Medicare Part B (medical insurance), and usually Medicare Part D (prescription drug coverage) into one plan. These plans cover all Medicare services, and some offer extra coverage for vision, hearing, and dental. They are offered by private companies approved by Medicare.
Still, while many offer $0 premiums, the devil is in the details. You will find that most have unexpected out-of-pocket expenses when you get sick, and what they pay can differ depending upon your overall health. While a MA plan might sound like a good idea when you are younger and healthier, as you age and get sicker, the MA Plan becomes more of an expensive nightmare. Here’s a look at some of the disadvantages of Medicare Advantage Plans. I’ve created an easy reference chart for ease of use.
If one of your main considerations when choosing a Medicare plan is premium cost, consider this. To give you an example of the types of copays you may find, here are some details of in-network services from a popular Medicare Advantage Plan in Florida:
• Hospital stays—$100 per day for the first 4 days
• Emergency Room – $120 copay
• Diagnostic radiology—up to $100 copay
• Lab Services—up to $50 copay
• Outpatient x-rays—up to $50 copay
• Outpatient surgery – up to $100 copay
As this non-exhaustive list of copays demonstrates, out-of-pocket costs will quickly build up over the year if you get sick. The Medicare Advantage Plan may offer a $0 premium, but the out-of-pocket surprises may not be worth those initial savings if you get sick. “The best candidate for Medicare Advantage is someone who’s healthy,” says Mary Ashkar, senior attorney for the Center for Medicare Advocacy. “We see trouble when someone gets sick.”
Switching Back to Original Medicare
While you can save money with a Medicare Advantage Plan when you are healthy, if you get sick in the middle of the year, you are stuck with whatever costs you incur until you can switch plans during the next open season for Medicare. At that time, you can switch to an Original Medicare plan with Medigap. If you do, keep in mind that Medigap may charge you a higher rate than if you had enrolled in a Medigap policy when you first qualified for Medicare.
I can’t advise you what you should do about Medicare coverage. I can state categorically that if you decide to get straight Medicare and add a Medigap policy when you turn 65, you can avoid many of the problems I have listed in this article. In the 48 years that I’ve been an elder advocate, I’ve encountered many, many clients who suffered because of Medicare Advantage Plans. Medicare is not perfect, but it’s the best health insurance one could get today.
If you have questions, please send me an email at firstname.lastname@example.org. I promise to respond. Stay Safe.