People who are members of Medicare Advantage (MA) plans have three additional months (January 1 -March 31st each year) to change their plan.
Why would you want to change your MA plans now?
Some reasons could include:
You missed the Annual Fall Open Enrollment period (October 15-December 7)
You didn’t realize your MA plan doesn’t include your medications, preferred doctors, hospitals, pharmacies, etc.
Your health condition has changed and you want better/different coverage.
Your financial situation has changed and you can’t afford the new Medicare Part B monthly cost ($170 for most people) for outpatient services plus your MA monthly premiums, deductibles, copayments, restrictions and exclusions of your current MA plan.
You or your relative didn’t understand the limitations, cost, or consequences of their current plan.
You got bad advice from a former friend or salesman.
Normally, you wouldn’t be able to change plans for these reasons during the calendar year, except in special circumstances (eg. moved out of service area, plan termination, end of employer coverage etc.). However, now you have 3 additional months to make a change each year.
To be eligible to make a change, you must currently be a subscriber of a Medicare Advantage plan (as opposed to being a subscriber to Original Medicare).
What are Some Permitted Changes?
You can change from one MA plan to another (either with the same or a different insurance company)
You can select a new MA plan that either increases or decreases your coverage and/or cost.
You can terminate your MA plan and switch to Original Medicare and buy (or not buy), a stand-alone Prescription Drug Plan (PDP).
In some states, like New York, you can also choose to purchase a Medicare Supplemental (Medigap) plan for added coverage to Original Medicare, with or without purchasing a PDP.
How to Change Your Medicare Advantage Plan?
If you want to explore other MA plan options with your existing MA insurance company, call their member services dept. (a phone number is listed on the back of your insurance card).
If you purchased your plan through an insurance broker that you feel provides great service, call them.
If you know one or more specific insurance companies and of their MA plans that you are considering, you can call and enroll in a specific plan by phone, on their website or on Medicare.gov. However, keep in mind, a company salesperson is only representing and getting paid by their company, so don’t expect them to recommend their competitors.
If you want to compare options among different MA insurers in your service area, go to Medicare.gov and select “plan finder” and enter your information and select different insurance companies and their plans to compare.
Are there independent people who can help you review your options, their coverage & limitations and costs?
Yes, there are a number of free, independent people that don’t work for insurance companies or receive any sales commissions that can help you understand these complex issues. They include:
Use the site below to find local representatives in your community.
MRC is a national non-profit agency that helps people with Medicare understand their rights, benefits and helps them navigate the complex Medicare system.
Caution
Please be cautious of responding to the endless TV ads with 60’s Jets quarterback Joe Namath and other TV personalities (The Medicare Helpline), door-to-door salespeople, group insurance presentations, emails, unsolicited phone calls and junk mail advertising to help “get you the free benefits that you are entitled to”. These are deceptive ads often using paid actors. They don’t represent Medicare or your health care providers. Their aim is to get you to call them and they will collect your personal information, sell it to a large national for-profit insurance company, who will follow-up and personally try to sell you their plans.
And, remember Medicare Advantage plans are big business for private insurance companies that receive taxpayer subsidies of approximately $12,000 a year per person. Most insurance companies don’t provide any health care services at all but rather provide obstacles to you and the healthcare providers that are trying to serve you.
As we enter the end of the year, it’s important to check if your health insurance plan has benefits that you need, but have not used and will be erased on New Year’s eve.
This applies to Medicare Advantage (MA) plans as well as some employer and marketplace plans.
Some plan benefits that you may have, but could use or lose, before year-end include:
Prescription drugs and vaccines
Preventative dental care
Contact lens/eyewear allowances
Healthy living rewards
Over-the-counter medication/supplies
Telehealth consults
Rides to/from medical appointments
Prescription Medications
The cost of prescription medications can be your highest medical expense each year and its one of the most complicated and least disclosed aspect of your health insurance. There can be considerable differences among private Medicare Advantage plans in their cost, choice & access to the medications that your doctor prescribes.
To help understand these differences, go to Medicare Plan Finder and enter your medications for Medicare Advantage plans in your area and the program will show the comparative: medical and drug premiums, deductibles, co-pays and co-insurance and optional benefits for all plans. Then, you can select a more detailed comparison of up to 3 plans that you are most interested in buying for 2023, before December 7th.
A couple things of other things that you can do before year-end are to check if your current plan offers discounts for using: 1.a preferred pharmacy 2. a discount for 90-day supplies of your maintenance meds (usually generics) from your plan’s preferred pharmacy. Some plans provide up to a 33% discount for a 3-month supply over the cost of buying medications monthly. In some cases, the cost of your medications from your pharmacy can be cheaper by not running it through your insurance plan, especially if your meds are subject to a high deductible and/or co-payment. So, check with your pharmacy.
If you take Tier 3-5 maintenance medications and have already met your yearly deductible, consider having your prescription refilled with a preferred pharmacy before year-end. If you wait until after the 1st of the year, you’re likely to have to pay another deductible early in the year.
Finally, if you are diabetic and use insulin, you should definitely check to see (using the Medicare Plan Finder) what your current or another MA plans for 2023 charges for the insulin that your doctor prescribes. Some plans may include the insulin that you use for $35 or less a month.
Vaccines
ManyFDA approved adult vaccines are covered in full with no co-pay or deductibles through your plan’s network of providers (PCP, pharmacy). These include flu, pneumonia, Hepatitis B, Covid-19 virus. However, not all plans include other important FDA approved vaccines that prevent illnesses such as shingles, tetanus, diphtheria and pertussis. Many insurers require an out-of-pocket deductible payment and a high-cost Tier 3 co-payment.
This means you can have insurance coverage for vaccines, but you may have to pay up to the full cost for specific vaccines.
Preventative Dental Care
In recent years, a number of MA plans have added preventative and some restorative dental care to their plans. While plans often emphasize two “free” cleanings, x-rays and exams a year. Some plans have also expanded their dental coverage to include other services such as filling, root canals, crowns etc. However, a common limitation to these dental benefits is that there is a maximum fee that the plan will pay participating providers for each service/procedure and often full payment coverage is limited to a low-negotiated fee agreed to by a small group of local dentists. If your dentist does not participate in the plan and accept their fee schedule, you will need to pay for the service out-of-pocket and then submit a claim to your insurance company and request reimbursement up to what they allow, not what you paid. Finally insurance companies commonly don’t provide you with their allowable fee schedule and they usually won’t pay for more than the plan’s negotiated rate with their in-network dentists. So, in most cases you won’t know if your dental work is covered until it is completed, paid and you submit a claim for reimbursements.
If you haven’t used up your dental allowance for the year, check with your dental office and either book an appointment before year-end and/or ask to go on an appointment cancellation list. This is another use it or lose it benefit.
Eyewear/Contact Lens Allowance
Most insurance plans have an eyewear/contact lens allowance. The amount of the allowance varies by insurer from $75 to $300/yr. and is usually tied to the premium that you pay. This benefit is another use it, claim it, or lose it. There is no rollover of the benefit to the next calendar year and you usually need a recent eye exam in order your eyewear or contact lens.
If you have a simple lens prescription, there are many options for ordering what you want/need online at reasonable prices for both contacts & eyewear. Examples can include regular & prescription sunglasses, reading glasses and stocking up on contact lenses.
Healthy Living Rewards
More plans are including incentives for healthy living because they attract healthier customers that use fewer medical services and cost the insurance company less to serve. Some plans offer rewards up to $200/yr. in debit cards for taking brief online classes, getting a flu shot, completing surveys, having an annual physical, mammogram, colorectal & PSA screenings, vision test, use of a gym etc.
As with many benefits, you need to earn the rewards, report them, claim them or lose them. There is no roll-over of unclaimed rewards to the following year.
Over-the-Counter Medications/Supplies
Some MA plans also include an allowance of up to $100 a year for over-the-counter medications and supplies. However, there are a number of procedures to complete along with restrictions and limitations that vary for each plan. For example, some plans advertise a $100/yr. benefit, but the fine print states that it is limited to $25 a quarter with no carry-over of the unused benefit from one quarter to another.
So, check with your insurer for the benefit details, limitations and procedures for claiming your rewards.
Health care systems continue to evolved and there are new services that are available, less costly and more accessible than your doctors office or a hospital emergency room. The first level of service is a call to your primary care provider (PCP) during office hours for a phone consult. The second option is to use a “Telemed Service” affiliated with your PCP for questions and concerns that you may have. Telemed services are often covered by your insurance plans with either a low or no fee. The next level of services is an Urgent Care Center. These centers. are designed to divert people from overwhelmed emergency departments. They can diagnose and treat a limited number of medical conditions. Hospital Emergency Departments and Ambulance Service providers are costly and designed to provide a rapid response to people facing life-and-death crises such as heart attacks, strokes, serious accidents & injuries etc. Ambulance service providers are responsible for assessing, stabilizing and transporting patients experiencing a medical crisis to an emergency department. Insurance companies won’t reimburse ambulance companies for providing transportation to individuals with less acute problems. However, recently some insurance plans have added coverage for a limited number medical rides to and from medical appointments. Check your policy or call your plan’s customer service representative listed on the back of your insurance card for more benefit information.
Major Differences among HMO, PPO and Medigap Plans
Unlike original Medicare where you can receive services from any health care provider that has a service and payment contract directly with Medicare, private Medicare Advantage (MA) insurance plans have the primary contract with Medicare and are paid on per capita basis (approx. $12,000/yr./person.) with higher Medicare rates based on the patients’ diagnoses & medical conditions.
HMO plans have well-established provider networks with service contracts and geographical boundaries. Services and use of specialists need to be coordinated and approved by your primary care provider. The patient cost for receiving out-of-network services can be substantially higher than in-network services with the exception of emergency services.
PPO plans also have service and payment contracts with providers that can include broader geographical areas and have less restrictions on prior approval to receive services from speciality providers. However it’s important to note that PPO service providers,who participate in Medicare, are not required to accept all medical insurance plans. This is a common problem for subscribers in small regional MA PPO plans who want to receive services in another state in the absence of a formal contract between the insurance plan and the service provider.
However, a recent development addressing this issue is that national Medicare Advantage insurers such as United Health Care, Humana and Blue Cross affiliates have developed reciprocal agreements among their plans that allow for the acceptance of patients from other affiliated plans at the in-network rates, thereby increasing access to services with lower out-of-pocket expenses. This expanded MA PPO plan coverage can provide a more comprehensive and less costly alternative (for some people) to the option of buying a free-standing Medigap plan and a Prescription Drug Plan along with the cost of your original Medicare.
Medigap plans are private insurance plans used to supplement the coverage of original Medicare including the subscriber responsibilities for deductibles, co-payments and co-insurance. Plans differ based on the comprehensiveness of their coverage, 12 different plan designs and cost of monthly premiums among the different states and regions. If you sign-up for a Medigap plan, you also need to sign-up for a freestanding Prescription Drug Plan (PDP), unless you have credible medication coverage from an retiree employer plan or the VA.
Individuals with high medical expenses, such as renal dialysis and chemotherapy, are good candidates to consider a Medigap plan. MA plans generally require a 20% co-insurance payments for dialysis & chemotherapy until you have paid up to $7,900 -$11,700 in a calendar year, not counting the cost of self-administered medications.
Opportunities to Change Your Medicare Plans
The period of October 15 to December 7th is the annual open enrollment period. If you already signed up for a MA plan, you can still change your plan until December 7th. If you missed this deadline, you can switch from one MA plan to a different MA plan or switch from a MA plan to original Medicare and add a PDP between January 1 and March 31st.
You can make changes yourself by using Medicare.gov, calling the respective plans or calling the State Health Insurance Assistance Program SHIP (877-839-2675)
If you have any comments, or suggestions, please share them with us.
October 15th is the start of Medicare’s Annual Open Enrollment Period that runs through December 7th. During this time, Medicare subscribers can make changes from their current plan.
Changes can include joining or changing:
Medicare Advantage (MA) plan;
Medicare Supplemental (Medigap) plan;
Prescription Drug Plan (PDP) or
returning to original Medicare coverage.
Background
Original Medicare is the government run health plan for seniors and disabled people that utilizes private doctors, hospitals and other service providers.
By comparison, Medicare Advantage plans, Prescription Drug plans and Medicare Supplemental plans are all run by private insurance companies. These including a variety of for-profits (eg. UnitedHealthcare, Humana, Aetna), national non-profit organizations such as Blue Cross and many regional non-profit insurers.
In addition, some individuals maybe eligible to receive their health insurance, as a retiree or spouse, through their former employer including federal workers. Service veteran may be eligible for health care and/or medications from the federal department of Veteran Affairs. And, many people may be eligible for federal, state or county financial assistance with the cost of their Medicare insurance, medical services and medications.
The Importance of Having a Good Medicare Plan
Selecting the best plan for you or your family member is a very important responsibility since the consequences can be significant both to your pocketbook and your ability to receive needed health care from your preferred providers.
However, the vast majority of people seldom make any changes in their insurance unless a crisis occurs. Your decision to stay or change your insurance plan in the Fall, generally results in a year long commitment, with few exceptions.
The Importance of Objective, Comparative Plan Information
Consumer Reports provides over 7 million subscribers with independent, comparative information and ratings of thousands of products and services. This information has proven to be highly valued by prospective buyers for over 70 years.
However, health insurance is a billion dollar, very profitable private industry with millions of dollars spent on marketing and sales and few people understand the Medicare coverage that they need and the limitations that they are buying.
Understanding the complexities of different health insurance options and eligibility for financial assistance is a very challenging task. People should look for assistance early from knowledgeable family, friends, non-profit agencies and trusted insurance agents who have a proven track record of working in the best interest of their clients.
Keep in mind, the print and TV advertisements, written literature and presentations that you receive from insurance companies and agents are aimed at selling you their policies for a commission that keeps paying them every year. Insurance agents are expected to know the products that they are selling but generally do not first assess your medical needs, priorities, budget, comfort with risk and then share with you, all of your options including products and services that they don’t receive a commission.
An insurance broker, who represents multiple companies, may provide you with broader options, but is still making their living by selling the plans that they represent, not providing you with objective, comparative information to help you make an informed decision.
How to Avoid Problems and Select the Best Plan for You.
Invest time to become aware of the services your buying, what is excluded and your full costs as you would for any major purchase or commitment.
Define what what medical services and prescription drugs you currently need and use.
Identify any upcoming major tests, surgeries or intensive treatment you are likely to need in 2023.
Prioritize your preferences – what is most important to you?
List your preferred service providers ( eg.doctors, hospitals, pharmacies)and find out what insurance plans they accept.
List out your generic and brand-name medications and their costs.
Define your domestic and international travel plans for next year.
Define what you can afford to pay for your insurance and health care and prescriptions.
Identify what Medicare plan options you have, their advantages, disadvantages and cost:
Original Medicare (no prescription drugs included)
Part D Prescription Drug plans needed with original Medicare and Medigap plans
Medicare Advantage HMO, PPO plans with and without prescription drug coverage
Supplemental (Medigap) plans
Employer plan (if available to you)
VA and Federal worker plans (if available to you)
What to look for in Medicare Advantage plans
Do your preferred providers have contracts with the plan(s) that you’re considering?
What is the extent and cost of out-of-network coverage? Will you likely need it?
What is the cost difference between in and out-of-network services?
Are all of your medications and preferred pharmacy covered and at what cost?
What are the plan’s premiums, deductibles, exclusions, co-pays and co-insurance rates?
What is annual Maximum Out-of- Pocket limit of your health care expenses?
11. Find out if you qualify for any assistance programsbased on your income & assets:
Low Income Subsidy (LIS/Extra Help))-federal assistance with prescription drug costs
Medicare Savings Plan (MSP)- federal/state/county assistance with Medicare Part B premium
Medicaid -federal/state/county assistance with Medicare, prescription drugs & nursing home costs
Hospital Financial Assistance – assistance with bills from participating hospitals
Patient Assistance Programs (PAP)- assistance from participation pharmaceutical companies
State Health Insurance Assistance Programs (SHIP) – assistance with the cost of prescription drugs from participating states
12.Resources to Help You with Medicare and Prescription Drug Plans
Medicare.gov (800-633-4227), is an excellent resource with general information and specific help in evaluating the differences among Medicare Advantage and Prescription Drug Plans (which are used with original Medicare and Medigap plans). If you are not comfortable using a computer, ask for help from a family member, friend or social agency.
State Health Insurance Assistance Program (SHIP) (877-839-2675) Medicare contracts with states, counties and non-profit organizations throughout the country to provide individuals with personalized education, support and assistance. These free services include comparative plan information, information regarding eligibility for financial assistance as well as help with selecting a Medicare plan, enrolling, and resolving problems.
Medicare Rights Center (800-333-4114) is a national, nonprofit organization that works to ensure access to affordable health care for older adults and people with disabilities through counseling and advocacy, educational programs, and public policy initiatives. MCR helps people understand their rights and benefits, navigate the Medicare system, and secure the quality health care they deserve.
For more articles on the political/economic dimensions of Medicare plans/policies and their impact on patients’ access to affordable, effective treatment go to http://healthplanadvisor.org.
And, feel free to share your comments and questions.
The National Council on Aging (NCOA), is a tax-exempt non-profit organization that helps older adults and their caregivers, meet the challenges of aging, often on a fixed income, through services like BenefitsCheckUp®.
BenefitsCheckUp is a free online service that connects older adults with information on a variety of benefits they may need and qualify for including, assistance with the cost of housing & utilities, food, health care, and insurance, medications, Veteran benefits, transportation, and more.
If the answer is yes, and you’re paying more than $35 a month for insulin, keep reading….
In 2021, Medicare introduced a pilot program called the Senior Saving Model (SSM) with the aim of reducing the cost of insulin to people on Medicare and improving the quality of their health care.
Who is eligible for this discounted insulin program?
People that have diabetes and are prescribed insulin
People that are enrolled in Medicare Advantage (MA-PD) plans or Medicare Prescription Drug Plans (PDP) that agreed to participates in the SSM.
People that take insulin from manufacturers that participates in the SSM.
What insurance companies and plans participate in the SSM?
There are a variety of insurance companies that sell Medicare Advantage (MA-PD) and stand-alone Prescription Drug Plans (PDP) ranging from large for-profits such as United HealthCare, Humana & CVS to regional non-profits such as BCBS affiliates to small plans with limited subscribers.
To illustrate, in Rochester, NY with a metropolitan population of over 1 million, there are 22 Medicare Advantage plans offered by 5 major insurers: Excellus (BCBS), MVP, CVS/Aetna, United HealthCare, and Wellcare. These insurers sell 22 different MA plans, however, only 4 plans from Excellus and 4 plans United HealthCare participates in the $35/mo. insulin SSM program.
In addition, there are 19 prescription drug plans (PDP) offered in Rochester to individuals that choose to enroll in either Original Medicare or a Medigap plan. Not all PDP insurers participate in the SSM program and not all of their plans include the $35/mo. insulin.
Some insurers offer discounted insulin in their plans with higher monthly premiums. So, you need to carefully evaluate the total cost of each plan including the premium, deductibles, and the price of your prescriptions, with and without the discounted insulin. A plan with discounted insulin may not be the lowest total cost plan when you include the total costs of the plan and all of your medications.
What Insulin brands participate in the SSM program?
Insurers that participate in the SSM program are required to include at least one vial and one pen dosage form for each of the different types of Model insulins, where available and including – rapid acting, short-acting, intermediate-acting and long-acting – all for at a maximum $35 copay for a one-month supply.
Participating Insulin Manufacturers include:
Eli Lilly and Company
MannKind Corporation
Mylan Specialty L.P.
Novo Nordisk, Inc. and Novo Nordisk Pharma, Inc.
Sanofi-Aventis U.S. LLC
How can you find out if your current plan or other plans available to you, participates in the $35/mo. SSM program and what specific insulins are included?
Call your plan’s member services (number is listed on the back of your card)
Ask your pharmacist
Call & ask Medicare at 800-633-4227
Check online at Medicare.gov/plan-compare.
With the online http://www.medicare.gov/plan-compare, after you input all your medications, you will see an estimate of your total annual out-of-pocket expenses for each plan that you are considering, and for each of your medications and the pharmacy that you select.
Please keep in mind, the Medicare Open Enrollment period end on December 7th, for changes in MA-PD and PDPs that will become effective January 1,2022.
Sounds good, but the pushback from Big Pharma and the members of Congress, that they give millions to each year, will be huge. Time will tell if there is enough congressional support to bite the hand that has been feeding them for decades.
“Seventy-two Senators and 302 members of the House of Representatives cashed a check from the pharmaceutical industry ahead of the 2020 election This represents more than two-thirds of Congress, according to a new STAT analysis of records for the full election cycle.”
Last year, Big Pharma spent $14 million funding your Congressional representatives.
Ten facts your doctor and pharmacist probably didn’t share with you.
Over ninety percent of drugs sold in America are generic.
And, 80% percent of generic prescription drugs are manufactured in India & China along with the Active Pharmaceutical Ingredients (API) that are used in patented brand-name drugs.
Drug manufacturing is one of India’s major industries. They have about 700 Indian drug manufacturing plants that employ tens of thousands of workers.
Foreign-made generics are less regulated and sanctioned by the FDA, even when they have had substantially greater data integrity, sanitary, quality and manufacturing deficiencies.
The FDA’s priority is approving new generic drugs to market faster. In 2019, over 1,200 new generic drugs were approved, while improvements in existing foreign drug manufacturing, safety and data integrity lagged behind.
Neither you, nor your doctor, are likely to know where your generic medications are manufactured and if serious quality and safety deficiencies have been identified by the FDA.
Pharmacies do not necessarily fill your prescription with the same generic manufacturers’ medication each time. They are commonly filled with whatever they have available, especially in mail-order and centralized pharmacy centers.
The FDA approval of generic drugs is substantially less stringent than brand name drugs. And, not all generic prescription drugs are identical for the same conditions. They can differ in the potency of API and the inert ingredients that can result in substantial differences in effectiveness, side-effects and adverse reactions.
The use of generic medications for certain serious medical conditions such as seizure disorders, blood thinners & bipolar disorders can have greater risks due to a narrow therapeutic range for the medication.
If your generic drugs comes in an amber pharmacy vial (compared to an original manufacturer’s stock bottle), it probably doesn’t include the name of the manufacturer and the country of where the generic drug was made
The food products that you buy and eat include substanially more FDA mandated product label disclosures including the manufacturers’ address and list of ingredients than the FDA regulated generic drugs that you take daily (on blind faith) for your physical and mental health.
For more information and to learn what you can do, explore the references below.
Medicare Prescription Drug Plans that are sold by private insurance companies in Medicare Advantage Plans and stand-alone Part D plans for people with Original Medicare and Medigap plans are funded largely under contracts with the federal government using taxpayers funds.
Here’s are 3 things in the fine print you need to know.
1. The new pre-election announcement of a “Part D Senior Saving Program” that lowers your out-of-pocket co-payments for insulin, doesn’t begin until January 1, 2021 and doesn’t include the millions of Americans who use insulin every day but are not on Medicare.
2. The progam is optional for government-funded Medicare plans to participate in and the specific insulin that your doctor prescribes for you may not be included in the plan that you select.
To illustrate, in the upstate NY, we have 30 Medicare Advantage plans offered by 5 different insurers. However, in reviewing the details of their plans, only Excellus BCBS and United Healthcare have chosen to participate in this special option that will benefit seniors and disabled people who need insulin to live.
The other insurers who sell federally subsidized Medicare plans but chose not to participate in this insulin option include: Aetna, Wellcare and MVP (a regional insurer).
In drilling down deeper into the participating plans of Excellus and United Healthcare, a few other differences were noted.
Excellus: offers 5 Medicare Advantage plan that have monthly premiums ranging from $0 to $255. However only the three of the higher prices plans ($79, $157 & $255/mo.) are participating in the savings program. The two plans with either $0 or $39 monthly premiums are excluded.
So, individuals who enroll in a $0 or $39 monthly premium plan will be subject to a $380 or $300 deductible and a $42 a month/ $84 for three month supply of insulin from a preferred pharmacy.
By comparison, individuals who enroll in one of the three higher priced Excellus plans will not be subject to a deductible and will pay $25 a month/ $60 for 3 month supply of insulin from a preferred pharmacy.
United Healthcare: offers 4 plans with monthly premiums ranging from $0 to $79 a month. All of their plans include the insulin saving plan with an insulin cost of $35 a month/$95 for 3 months from a preferred pharmacy until you enter the catastrophic phase of medication expenses.
Finally note….always confirm that all your health care providers participate in any health insurance plan you are considering and that the medications that your doctor and you feel work best for you are also included in the plan’s formulary.
And, don’t be distracted with the marketing of $0 premium plans and extra free benefits that you may never qualify for or use. Spend some time shopping and comparing plans based on your most critical health care needs and the cost you’re likely to experience in the coming year.
There are two common problems that I see with clients….some are gamblers and they are under-insured even when they can afford to be safer.
And there are others that are too complacent and continue to stay with the same insurer/plan for 10 plus years even when their needs and income have changed. They are spending too much on insurance and don’t have enough money for other basic needs.
Look at the options that are available to you and make a choice that allows you to sleep at night.
Background of Private Medicare Prescription Drug Plans
Legislation design by the President G.W. Bush administration and approved by Congress in 2003, resulted in the creation of a new privatized Medicare prescription drug (PDP) and Medicare Advantage (MA) plans for millions of elderly and disabled individuals. However, there was no responsible plan to pay for it. No new federal revenue sources were included nor were there cuts to existing federal expenses. Instead, federal subsidies were authorized for these new privatized Medicare benefits and these private insurers could also retain profits above and beyond their costs.
Traditional Medicare insurance which was already serving over 40 millions Americans in 2003, was not allowed to offer prescription drugs or other new benefits that private Medicare Advantage plans included.
It should also be noted that private insurers are allowed to pick and choose where and how long they want to sell plans compared to Traditional Medicare that is available to everyone that is eligible in the country.
As a result, two new publically funded, private health insurance plans were sold to the public on the assumption that they would cost less than Traditional Medicare and provide more benefits. However, today Medicare Advantage and PDPs cost taxpayers $328 billion/annually in federal subsidies.
The 2003 legislation also prohibited Medicare from negotiating drug prices on behalf of subscribers (as is done with the VA and Medicaid) and outlawed the importation of prescription drugs from Canada and other countries where they are sold at lower prices. As a result, prescription drug costs have sky-rocketed over the past 15 years.
Today, 43 million people are enrolled in private Medicare Part D drug plans either in stand-alone PDP how many people or integrated within Medicare Advantage plans.
In addition, the federal Social Security Administration subsidizes the cost of private insurer PDP premiums, deductibles and medications for 13 million low income individuals. This represents 28% of all PDP enrollees.
Important Facts to Know about PDPs
Today, the vast majority of Medicare Advantage Plans today include prescription drug coverage. However, Traditional Medicare and private Medicare Supplemental (Medigap) plans don’t include drug coverage, so a separate private PDP is needed for your medications and to avoid a potential late enrollment penalty.
Medicare-approved stand-alone PDPs are sold primarily by large, for-profit insurers such as Aetna/CVS, Cigna, Humana, SilverScript, United HealthCare and WellCare.
Private insurers are allowed to charge subscribers plan premiums, deductibles and co-pays/co-insurance for medications in addition to the federal subsidies that they receive.
Insurers also exclude specific drugs from their formulary, establish restrictions, such as requiring prior insurer authorization, limit medication quantities and require that subscribers take lower-cost drugs before higher-cost drugs.
Each insurer establishes their own drug classifications into pricing tiers and there are significant differences among PDPs regarding the drugs that are excluded/included and the premiums, deductibles, co-pays/coinsurance that subscribers are required to pay.
Although PDPs are not allowed to deny coverage or charge higher premiums to subscribers with pre-existing conditions and chronic diseases, insurers have latitude with establishing restrictions and subscriber charges.
There are no annual maximum out-of-pocket expenses for prescription drugs in either Medicare Advantage or stand-alone PDPs, so the cost of drugs can create serious financial problems for families.
In a 2019 study, reported in Health Affairs Journal, more than half of seriously ill Medicare enrollees face financial hardship with their medical bills with the cost of prescription drugs being the leading problem.
Unlike the rest of the developed world, in the US there is no public insurance for medications or government negotiation of drug prices, with the exception of the VA and Medicaid. As a result, the cost of medications to treat millions of Americans with life-threatening and disabling diseases such as diabetes, cancer, multiple sclerosis, Hepatitis B, inflammatory diseases, respiratory diseases, organ transplants are the highest in the world.
The cost of medications has become a huge burden on taxpayers; federal, state and local governments; employers; patients and families. This results in more costly health care with poorer outcomes, increases in disability, reduced work productivity and results a major cause of personal bankruptcies in the US.
A Review of PDPs Available in Rochester, New York
Popular plans offered by Aetna/CVS, Cigna, Express Scripts, Humana, SilverScripts, United HealthCare (UHC) and WellCare reveal the following observations.
Each insurer generally offers 3 plans with different premiums and deductibles. Premiums range from Humana’s Walmart Value plan $13.20/mo. with a $435 deductible, to SilverScript’s Plus plan $91.20/mo. with a $0 deductible.
It is common that low/no premium plans have higher deductibles, co-pays/co-insurance and limitations.
Only 3 plans have no deductibles (down from 7 plans in 2019) but all have high premiums. The 3 plans include SilverScript Plus with a $91.20/mo. premium, United HealthCare AARP Preferred with a $85.60/mo. premium and WellCare Value Plus with a $76.60/mo. premium. These plans are not affordable for most people, since the average annual premium is over $1,000 and doesn’t include the cost of your medication.
All insurers have developed strong financial disincentives for subscribers who use “non-preferred” brand name and generic medications by establishing medication exclusions, deductibles and up to 50% co-insurance for non-preferred brand name Tier 4 drugs.
Many insurers also charge higher prices for “standard” versus their “preferred” and “mail order” pharmacies. However, insurers are generally weak in informing current and prospective enrollees of the cost differences among pharmacy options.
There are significant differences among insurers in specific brand name drugs that are either excluded from their formulary or placed into either Tier 4 or Tier 5. And, there are differences among insurers regarding the price of T4 non-preferred brand name vs. T5 specialty medications. To illustrate, it is not uncommon that T4 non-preferred drugs are billed at a high rate of 32%-50% compared to T5 speciality drugs that are billed at 25%-33%.
An insurer’s “Preferred generic and brand name” medications are not the most cost-effective medications with the least side-effects. “Preferred” medications reflect the deals that the insurers have made with the pharma companies to push their drugs over their competitors drugs.
This often occurs with medications for common conditions including rheumatoid arthritis, multiple sclerosis, diabetes and various neurological, cardiovascular, inflammatory, autoimmune and respiratory diseases and cancer.
Issues of drug cost, insurance prior approvals and access to treatment is a major source of conflicts among insurers, physicians and patients. So, it is very important to compare plans to understand the differences in coverage, restrictions and cost among plans that you are considering.
In summary, in considering PDPs it is important to confirm if the plans:
Do they include your medications and at what cost?
Is there a deductible expense on your drugs?
What restrictions are imposed on your prescribed medications?
Does the plan have preferred retail and mail-order pharmacies?
What is the reputation of the insurer with your doctors and pharmacies?
And finally, what is the total annual cost to receive your medications from each plan and the comparative differences in the PDP quality, costs and benefits.
Resources
Free resources are available to help you in comparing costs, coverage and quality ratings among plans. These include:
Provides detailed information from Medicare to compare Quality Star ratings, your estimated annual and monthly cost (premiums, deductibles, co-pays/co-insurance) for your specific medications and pharmacies among available Prescription Drug Plans and Medicare Advantage Plans sold in your community.
Medicare’s annual open enrollment runs from October 15th to December 7th. During this time, Medicare subscribers can join or change plans including:
Medicare Advantage plans:
Return to the original Medicare coverage
Medicare Supplemental (Medigap) plans;
Part D Prescription Drug plan
It is very important to make an informed choice of the best insurance plan for your medical needs, preferences, and budget. A bad choice can cost you thousands of dollars and prevent you from receiving services that you need from your preferred providers.
Medicare Insurance Options for Seniors
Original Medicare is the government-run health insurance for seniors and disabled people that use private doctors, hospitals and other healthcare providers.
By comparison, Medicare Advantage (MA) plans that often include a prescription drug plan, stand-alone Prescription Drug plans (PDP) that are used with original Medicare and Medigap (Supplemental) plans are all sold by private insurance companies that are subsidized and regulated by Medicare.
These plans are offered by a variety of large for-profits (eg. United Healthcare, Humana, Aetna), national non-profit organizations such as Blue Cross and many regional non-profit insurers.
In addition, some seniors are eligible to receive their health insurance through their current or former employer. And most Veterans are eligible to receive their health care and medications through the Veterans Administration.
Common Problems to Avoid
Your plan doesn’t include your preferred service providers.
If you don’t verify that your health care providers have a network contract with the insurer that you are considering, you could be facing huge bills. You could be responsible for paying the full cost of expensive services from health care providers or declined service.
Out-of-Network does not mean out of your area. Your preferred health care provider could be next door, but may not have a contract with your insurance company.
Be especially cautious of PPO plans, often sold by national insurers, that lead you to believe that you can go to any doctor anywhere. This is not accurate. Many times national insurers have not developed local provider networks or formal contracts. They often pay commissions to insurance agents to sell policies but do not have local staff to resolve provider and subscriber issues and concerns. These are often handled by central call centers.
The fine print in PPO plan documents includes this disclaimer:“Out-of-Network/non-contracted providers are under no obligation to treat plan members, except in emergencies”
This means that while you may have insurance, you may not be able to find a provider that accepts your plan, for a variety of reasons.
You Didn’t Anticipate High Deductibles and Out-of-Network Costs
Some plans, such as the Aetna Elite PPO are advertised as a $0 premium plan, however you need to pay the first $1,000 for many medical services plus an additional $350 deductible for Tier 3,4 & 5 drugs including vaccines that do not have a generic equivalent. In HMO plans, you could be responsible for the full cost of “out-of-network” services.
Consumers need to be aware that each insurer decides what drugs to include and exclude, and what they will charge subscribers. Generally, you will be responsible for the full cost of medications that are not included in the plan’s formulary. Drug prices can also vary by the pharmacy that you choose and if you choose a 90 day mail-order supply versus a more costly monthly supply.
In considering plans, you should not focus solely on the advertised premium cost, but rather your medical, drug, out-of-network needs and your projected out-of-pocket expenses including premiums, deductibles, co-pays, out-of-network charges and drug costs.
Medicare.gov provides a “plan finder” that helps you analyze medical & drug expenses among various plan options that are available where you live.
You Didn’t Consider Medigap Plans for High Medical Expenses and Maximum Choices
Many Medicare Advantage HMO plans have little or no out-of-network coverage and you may have to pay for the full costs of services that you receive. If you have serious medical conditions that require costly tests, hospitalization, nursing home rehabilitation, outpatient
surgery and intensive outpatient treatment such as cancer, heart disease, renal disease and/or you would like the freedom to select specialty providers outside of your plan’s network, you’ll need good coverage at an affordable price. “Original Medicare” has no limit on your annnual expenses. And, Medicare Advantage plans have a high annual maximum out-of-pocket limit of $6,700 but there is an alternative–Medigap plans.
As a general guide, if your projected annual out-of-pocket medical expenses (premiums, deductibles & co-pays – excluding your prescription drug expenses) exceeds $3,000/yr. and/or you want Medicare coverage across the country, you should explore a Medigap plan.
Medigap plans provide supplemental coverage to original Medicare and pays for deductibles and copays. All healthcare providers who participate in Medicare across the country are included and there are no out-of-network exclusions or surcharges.
Medigap plans are regulated by each state and you can receive information on the availability of plans and their premiums by contacting your state insurance department medicare.gov/contacts.
You Didn’t Think You Needed or Understood Differences in Prescription Drug Plans
Most Medicare Advantage plans include prescription drug (Part D) coverage. However, if you have “Original Medicare” with/or without a Medigap plan, you will also need to purchase a prescription drug plan (Part D) unless you have an approved employer drug plan or receive your medications from the VA.
If you don’t have a an approved drug plan and you want to purchase one at a later date, you are likely to be subject to a late enrollment penalty.
Part D plans are sold by private insurance companies and vary from state to state. For example, in New York State 27 plans are available from 10 different insurers. The premium and deductible cost of plans in New York varies widely from a Humana Walmart plan that costs $13 a month with a $435 deductible to a SilverScript plan that costs $91 a month with no deductible.
It is also important to check plans that you are considering to confirm that the medications that you need are included and what your co-pays and total annual expenses will be before enrolling in a plan.
Medicare.gov has a planfinder that compares the different cost of the various Part D plans based on the medications that you use and where you live.
You Didn’t Expect a Medicare Enrollment Penalties
Medicare rules require that if you want to receive Medicare benefits, you need to enroll and pay your Medicare Part B (outpatient) and Part D (prescriptions) premiums when you are first eligible. There are a few penalty exceptions, for example, if you receive creditable medical and drug insurance from you or your spouse’s employer, if you receive your medications from the VA.
Medicare penalties can be significant. The Part B (outpatient care) late enrollment penalty is 10% for each year, from the date of your initial Part B eligibility. The Part D (prescription drugs) penalty is 1% for each month from when you were initially eligible, or June 2006, the start of the program. There are a few circumstances when penalties can be reduced or eliminated.
The Importance of Having a Good Medicare Plan
Selecting the best plan for you or your family member is a very important responsibility since the consequences can be significant, both to your pocketbook and your ability to receive needed health care from your preferred providers.
Investing time in planning and seeking objective advice in selecting a plan, can save you a lot of time, money and headaches. The following is a list of free resources that are available to help you.
The Social Security Administration is the agency that you need to contact to apply for your Social Security benefits and enroll in Medicare Part B and D., In addition, you can be screened for eligibility (income and resources) and apply for “Extra Help” with your Part D premium and cost of your medications
An excellent resource with Medicare information and specific help in comparing Medicare Advantage and Prescription Drug Plans in your area.
State Health Insurance Assistance Program SHIP 877-839-2675
Medicare contracts with states, counties and nonprofit organizations to provide individuals with personalized education, support, and assistance with Medicare.
These free services include comparative plan information, eligibility for financial assistance as well as help with selecting a Medicare plan, enrolling, and resolving problems.
Partnership for Prescription Assistance
This is an online information resource tool. You can learn about assistance programs that are available for specific medications, along with the eligibility criteria and program applications.
The Medicare Rights Center is a national, nonprofit consumer service organization that works to ensure access to affordable health care for older adults and people with disabilities through counseling and advocacy, educational programs and public policy initiatives.
This article was updated in October 2019 from an earlier post.
Inside Health Care 