Medicare Shopping Season Is Almost Here
Every fall, the 60 million Americans who use the health plan can compare options and save money. Here’s what to consider.
If you’re enrolled in Medicare but worry about the cost of health care, your chance to do something about it is right around the corner.
Most
people enroll in Medicare when they become eligible at age 65. But
every fall, they have the opportunity to change their coverage during an
enrollment season that runs from Oct. 15 through Dec. 7. This is the
time of year when you can switch between original fee-for-service
Medicare and Medicare Advantage, the all-in-one managed care alternative
to the traditional program. You also can re-evaluate your prescription
drug coverage — whether that is a stand-alone Part D plan, or wrapped
into an Advantage plan.
It’s a good
idea to do a checkup on your coverage, even if you are happy with your
current choices. Prescription drug plans often revise their lists of
covered drugs, the rules under which they will be covered and their cost
sharing. If you’re enrolled in an Advantage plan, it’s a good time to
determine if your health care providers will be in your plan during the
coming year, and whether a move to original Medicare makes sense.
Yet few Medicare enrollees take advantage of fall enrollment. For example, research by the Kaiser Family Foundation found that just 11 percent of Medicare Advantage enrollees voluntarily switch plans each year. Another study,
conducted in 2013 by the foundation, found that 13 percent of Part D
enrollees switch voluntarily. Yet nearly half (46 percent) of those who
did switch plans cut their premiums at least 5 percent the following
year.
“People are well aware that they should shop and compare, but it’s a lot of work,” says Tricia Neuman,
director of the Kaiser foundation’s program on Medicare policy. “And
they are not confident they’ll be able to choose a plan that provides
better value.”
Fall enrollment
provides the opportunity to make sure you’re getting the best-fit
coverage and to save some money on premiums and other out-of-pocket
costs.
Original or Advantage?
The
most basic Medicare enrollment decision is whether to use original
fee-for-service Medicare or an Advantage plan. Most of the 64 million
people enrolled in Medicare this year use the original program, but 34
percent are in Advantage plans, Kaiser reports.
Advantage
plans often include extra benefits, including some level of dental,
vision or hearing services, and gym memberships. This year, most
Advantage enrollees (88 percent) are in plans that include drug
coverage, and more than half of them (56 percent) pay no additional drug premium beyond their Part B premium, according to Kaiser.
The
trade-off is that Advantage enrollees must use health care providers
within their networks, or pay more for out-of-network services.
Enrollees in original Medicare have
access to a much wider range of providers, and they do not need to
navigate the referral requirements and prior authorization steps used by
many Advantage plans.
Many enrollees in original Medicare buy supplemental Medigap policies to cover their out-of-pocket expenses. These can be significant.
There’s no annual limit on what you pay out of pocket; Part A
(hospitalization) has a deductible this year of $1,364 for each episode
of illness, plus fixed daily costs for extended stays. Part B
(outpatient care) covers 80 percent after you meet the annual deductible
($185 this year). Users of the original program usually also buy a
prescription drug plan, with premiums averaging just over $33 a month
this year.
But original Medicare can
be less expensive for enrollees who encounter a serious illness and use a
lot of services. That is because the annual premiums for Medigap, which
cover nearly all cost-sharing requirements in Medicare Part A and B,
usually are lower than the out-of-pocket limit found in Advantage plans.
Advantage plans are required to cap total
out-of-pocket spending — the average among all plans this year for
enrollees in H.M.O. or PPO plans is $5,059 for in-network services, according to Kaiser; the average limit rises to $8,818 when Advantage PPO enrollees use out-of-network services.
Medigap
premiums, by contrast, vary greatly by region — but often it is
possible to cap out-of-pocket costs at a lower level than what is
available in Advantage plans. In New York City this year, Medigap Plan G
plans, among the most comprehensive options, range in cost annually from $2,640 to $5,460, according to Medicare data. But in Nashville, Tenn., the same plans carry premiums ranging from $1,044 to $2,580.
“It’s
important to look at the doctors and hospitals in the network,” Ms.
Neuman said. “Many people are less likely to think about this when they
first join Medicare, especially if they are relatively healthy. They
don’t really consider whether specialists are in network until they do
get a serious illness, which may come years after they first go on
Medicare.”
Advantage
enrollees who think they may want to shift to original Medicare with a
Medigap plan should do so while they are still healthy. When you first
sign up for Part B, Medicare’s “guaranteed issue” rules forbid Medigap
plans from rejecting you, or charging a higher premium, because of any
pre-existing conditions. But after that time, Medigap plans in most
states are permitted to reject your application or charge higher
premiums.
Shopping for plans
Medicare
plan searches often begin with the Medicare Plan Finder, the official
government website that posts stand-alone prescription drug, Medicare
Advantage and Medigap offerings. The plan finder is a tool that allows
you to browse plan options that match your medication and health
provider needs, along with premiums. But a recent redesign of the plan finder has prompted worries among Medicare consumer advocates and organizations that help enrollees with plan selection.
Several studies had criticized the plan
finder for confusing navigation and incomplete or incorrect information.
The Centers for Medicare & Medicaid Services aimed to correct these
issues with the redesign, and Medicare advocates generally say the new
tool is an improvement.
But the new
plan finder was rolled out just before Labor Day, leaving little time
for Medicare enrollment counselors to be trained and to identify
problems before the busy fall enrollment period begins. (Users can
choose between the old and new sites until Oct. 15; at that point, only
the new site will be available.)
“October 15th is right around the corner, so the lead time has been very short,” said Ann Kayrish, senior program manager for Medicare at the National Council on Aging. Ms. Kayrish provides training to State Health Insurance Assistance Programs, a national network of federally funded programs that provide free Medicare counseling using volunteers.
“SHIPs are struggling to train their
volunteers not only on the new plan finder, but also all the changes
with Medicare plans for the coming year,” she added.
The new site has shortcomings. After a detailed review, the
Medicare Rights Center, an advocacy group, wrote to CMS this month
calling for changes that are “urgently needed” before fall enrollment to
improve the tool’s accuracy and usability. A key criticism is that the
new tool does not allow users to sort plans by total out-of-pocket
costs, including premiums but also deductibles, copays and coinsurance
payments. That feature was available in the old plan finder.
“There
are an overwhelming number of plans available, and our hope is that
this new tool will make it easier for people to choose the best plan
option with respect to affordability and coverage,” says Frederic Riccardi,
president of the Medicare Rights Center. “People are at risk of having
to pay more for their drugs or plan by not reviewing their coverage. It
concerns me that people pay more than they should or go without their
prescription drugs due to plan restrictions.”
CMS declined to comment for this article, but in a posted FAQ about the new site it stated that a cost filter would be added, and that its plan to do so was “on track.”
The
plan finder also lacks detailed information on health care providers in
Advantage plans. That leaves enrollees the challenging task of
reviewing directories provided by individual plan providers.
“Some
plans give customers access to online search tools to look up a
particular doctor or hospital,” Ms. Neuman said. “Others send out a PDF
of a big, fat directory that you can look through.”
Directories
often can be outdated or contain errors, studies have found. So it
makes sense to ask your doctors and other providers directly if they
participate in any plan you are considering.
The new plan finder also does not yet allow users to search for Medicare Advantage plans that will offer new nonmedical services next year.
The Chronic Care Act,
approved by Congress last year, permits plans to begin paying for
services such as grocery deliveries, caregiver support and retrofitting
homes to support older adults with chronic conditions. They also are
permitted to expand transportation services, which had been limited to
visits to health care providers.
Advantage
plans are not required to offer the new services, and they will be
available on a very limited basis during 2020. Aetna, for example,
expects to offer the expanded transportation services, fall prevention
and help with meal preparation in just a few plans next year, said Christopher Ciano, senior vice president of Aetna Medicare.
“We’re still in a test and learning mode,” Mr. Ciano said.
Just
as important, joining a plan that offers the new nonmedical benefits
does not guarantee that you’ll receive them. The new benefits are
targeted to enrollees with serious chronic illnesses or functional
limitations, and Advantage plans will determine who qualifies.
(Separately, President Trump signed an executive order this week
instructing Medicare officials to propose ways to further beef up
Advantage offerings and reduce their premiums. The executive order will
not affect Advantage plan offerings for 2020.)
For
now, the best way to find plans offering the new services is to contact
plan providers by phone. But it’s not advisable to drive a plan choice
solely by these new benefits, experts caution.
“It’s
important to look beyond additional benefits, such as dental coverage
or these new nonmedical services,” Mr. Riccardi said. “You need to look
at the entire picture — the network of providers and cost-sharing for
health services offered by the plan.”
Shopping tips
The
choices facing Medicare enrollees are complex, and it makes sense to
get some unbiased help. The State Health Insurance Assistance Program
provides free one-on-one counseling every year to nearly three million
beneficiaries, their families and caregivers. Each state has a SHIP
program; use this link to find yours.
The
Medicare Rights Center suggests signing up for plans by contacting the
program directly at 1-800-MEDICARE. Take detailed notes on your
conversation, including the date and the Medicare representative’s name
to protect yourself if you encounter any problems with enrollment.
Check the chip guidelines carefully before exploring the CHIP programs, this will help you to find best plans for your child.
The trade-off is that Advantage enrollees must use health care providers within their networks, or pay more for out-of-network services.
ReplyDeleteThese days people are well aware that they should shop and compare easily.
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