Medicare open enrollment runs through Dec. 7; your advantage isn't always with Advantage; use caution when choosing a plan

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By Melissa Patrick

Kentucky Health News

Open enrollment for Medicare occurs each year from Oct. 15 through Dec. 7, with new coverage starting Jan. 1. During this period you can change your choice of health coverage or add, drop, or change Medicare drug coverage.

People with Medicare can get coverage through either original Medicare or one of the Medicare Advantage plans, which are private insurance offerings under contract with the federal government to provide Medicare-covered benefits.

It is often reported that one of the biggest pitfalls of Advantage plans, which manage the care for most Medicare beneficiaries, is that they often have a limited network of doctors and hospitals and often charge more to see out-of-network providers, if a person is allowed to see them at all. In other words, a person doesn't have the same level of choice as they would with an original Medicare plan.  Also, Advantage plans are reported to require a high number of prior authorizations that can lead to denial of coverage.  

Longtime health journalist Trudy Lieberman has often written about the challenges of Medicare Advantage plans, noting that the lure of low premiums and added benefits like dental care and gym memberships seems great when you are well, but it's important to remember that these plans may not offer what you need if you get sick. 

Lieberman reminds people to look at what an Advantage plan offers if you get sick or get a get a serious illness, including your out-of-pocket maximums, and what the rules are if you switch back to an original Medicare plan; if you developed a health condition while on Advantage, it could be hard to switch back. 

And Medicare Advantage may be a bad bet for taxpayers and consumers. A report by Physicians for a National Health Program says Advantage plans overcharge $88 billion to $140 billion a year.

The report "identified four major ways that private insurers systematically exploit the publicly funded national health insurance program while denying care to the nation’s most vulnerable patients," Matthew Cunningham-Cook and Lucy Dean Stockton report for Jacobin, which calls itself "a leading voice of the American left." 

The four ways are favorable selection and deselection, which causes Advantage clients to use fewer services than those on original Medicare; upcoding, which makes patients appear sicker than they are; quality benchmarks and county bonuses that "fail to capture savings for the Medicare program, according to the Medicare Payment Advisory Council (MedPAC); and induced utilization, an assumption that Advantage plans provide more care than they actually do, so they get paid more. 

The rationale for Advantage plans is the flat fee they get for each enrollee and their management of the enrolleees' care to limit claims for care. The Jacobin writers call that an incentive to "ration care, leading to high rates of wrongful claim denials, worse health outcomes, and costly administrative headaches for providers." They note that research  by MedPAC, an independent agency that advises Congress on Medicare, shows that the program has not yielded savings in the two decades since it was established, despite proponents' claims that it would do so.

Lieberman, noting that the federal government continues to move away from traditional Medicare to some version of privatized managed care, like Medicare Advantage, Lieberman concludes her story for the USC Annenberg Center for Health Journalism by asking, "Will this latest Medicare experiment, which brings in more private equity firms that want a piece of the program, really solve Medicare’s cost problem, or will it simply hand over more of the program to private companies seeking to grow their profits? Is this solution really in the best interest of America’s seniors and their health, or another clever instance of American companies mining the health-care system for fresh profits?"