How Well Private Medicare Works - Not

“Kerry N. Weems, the acting administrator of the Centers for Medicare and Medicaid Services, sent ‘secret shoppers’ to 240 marketing events [for Medicare Advantage plans] last fall, and they found inaccuracies or omissions in three-fourths of the sales presentations.” [emphasis added]

- The New York Times, 5 May 2008

Maybe that’s why, two years ago when I signed up for Medicare, I couldn’t make sense of what Medicare Advantage plans are. I still receive dozens of mailings in the fall of each year urging me to give up my government Medicare in favor of these private plans – which is what Medicare Advantage is: privatized Medicare.

It first came into existence in 1997, when it was called “Medicare+Choice” and renamed Medicare Advantage in 2003. It is also referred to as Part C. These private plans replace traditional Medicare and often include prescription drug coverage which many traditional Medicare beneficiaries purchase through Plan D, also private coverage for which Medicare is not allowed to negotiate prices.

But there is a big problem with Advantage plans. Medicare pays those private insurers an average of about 13 percent more that it would spend for the same beneficiaries in traditional Medicare.

“…privatized Medicare provides inefficient coverage, steals years of solvency from the program, costs $10 billion more each year than traditional Medicare while passing more costs on to seniors.” [emphasis added]

- entitledtoknow.com, 13 March 2008

The bottom line is that traditional Medicare beneficiaries are subsidizing the already rich private insurance carriers and that’s on top of the fraud in high-pressure sales tactics involved in many Advantage plans.

Now, the Bush administration wants to set new rules that would crack down on the insurer’s aggressive sales tactics. Among the proposals:

“The Bush proposal would prohibit door-to-door marketing of private Medicare plans. Agents could not accost beneficiaries in the parking lot of a center for the elderly, a clinic or an apartment building. Agents could respond to telephone inquiries, but they could not make ‘cold calls’ to beneficiaries.”

- The New York Times, 9 May 2008

I suppose that’s a start, but it’s a typical Republican solution – hard to enforce and preserves the 13 percent giveaway to private insurance companies.

Explain to me again how market forces - which the healthcare plans of all three current presidential candidates maintain - keep prices down for everyone?

[At The Elder Storytelling Place today, Nancy Leitz offers a clever solution to a tired, old marriage question in Hi Hon. What Did You Do All Day?]

Comments

[Pete]

You have to give the devil his due, as the saying goes. Getting Congress to allow redirecting the huge money pipe of Medicare so that it pours directly into the insurance industry required real genius, however evil. And to name the program Advantage was the crowning achievement.

Last fall, my mother-in-law Betty received an innocuous notice from her pension-sponsored Medicare supplement plan about changes in the Medicare law. They made it sound as if they were bending to the will of the people, as expressed in changes to the law. Without actually saying so, they implied that they were being forced to make changes.

Under the "Advantage" plan, Betty's effective medical coverage was savaged. It took us three months to straighten out the mess. Although it is no longer possible for Betty to find the kind of coverage and premium structure she had before insurance lobbyists went to work, what she has now is significantly better than the Advantage plan.

We got a lot of help and good information from the Area Agency on Aging.

[Rain]

My husband is just now signing up for the medicare system. There is no choice when you reach 65 and the real beneficiaries seem to be the corporations who are off the hook for much of what they were paying as part of their benefit package. It is confusing and already they have glitched our coverage which it's hard to say how complicated it will be to get resolved. We were forewarned of the problem by friends who turned 65 a few months earlier. It didn't help.

The problem we all will face, as a nation, for universal coverage, will be hard questions. What will it cost for everyone to receive equal health care through government? What happens to the jobs of all those insurance corporation employees if we really eliminate insurance? What tax rate will be required if we actually cover the whole country for every possible illness? If we say nobody can get the more advanced care that is possible because everybody can't be covered, will seem unfair. Not everyone has equal food, equal housing, equal cars, equal anything. If we go to total equality of medical care what will be the tax rate required for those working? I know some countries have worked this out but I have heard that as more of their population reach old age, where more face more health issues, they will face bankruptcy of the system. I don't know the answer.

When I was a child, the kind of care that was available to everyone at a pretty reasonable fee was minimal. You went to your local doctor, got a chest x-ray maybe, some vaccinations, simple surgeries but nothing like the testing and care that is possible today. There were very few specialists even when I was a young adult. Expensive medictations like our cholesterol lowering pills weren't there for anybody. We have gradually gotten so much but we have not known the true cost given most of us, who work for corporations, have had no clue what anything costs anymore. It is still being paid. The true cost is just hidden.

[Darlene]

Sometimes I get so weary of trying to explain the advantage of a single payer system that I want to throw in the towel. All of the facts (not the scare tactics advanced by the government and the insurance industry) point to the cost saving of a single payer system. Taken in total, the proof is indisputable that it is the least expensive way to go. It has already been documented that it will cover everyone, save money and be fair to all.

Yes, the influx of the baby boomers are putting a strain on the countries that use the 'single payer' system, but they are doing the same thing to our 'for profit' system. This fact does not change no matter what system you use.

Have you noticed the things that are no longer covered and the rapid rise in co-pays, especially for hospitalization? It can't be worse than it is so I say, "Give the Single Pay System a chance and back it.

[Alice]

Hubby and I research exhaustively when I was signing up a year ago, and I wound up on Med Advantage because the insurance companies making the sales pitch all made it sound like THE way to go. It sounded rosy, but I found so many glitches along the way that we decided to re-investigate through and this time went for impartial help from county agent services. They referred us to an independent agent who finally explained it to us in the nick of time. Med Advantage pushers point out rightfully that you can switch plans later if you change your mind. What they don't tell you is that after one year under the Med Ad plan, you're no longer guaranteed coverage by other private insurers. Thus is you have a medical problem requiring expensive treatments they have the right to reject you, OR they'll insure you at greatly higher costs (if they enroll you at all). We were lucky because our independent agent was able to steer us into the private medicare, a "right" plan for us, BEFORE I had been enrolled for a full year. I'm so glad Ronni is bringing more of these issues out. All I can say is, read the fine print, figuratively and literally!

[naomi dagen bloom]

thank you, darlene for repeating "single-payer" a couple of times in your comment! it's also known as "Medicare for all." there has been a bill, HR 676, languishing in the House for some time.

my representative is one of the 88 who signed on some time ago. and yours, readers?

[tamar]

May I add canary-in-the-coal-mine to the list of descriptors that apply to you, dear Ronni? And, thanks to your and your commenter's experience and research, I will seek the help of my local agency on aging when I return to the USA July 5 (while my wonderful Israeli health coverage takes a break), well before I need to sign on any dotted line. This gobbledygook is not for dummies (who are really the smarties).

[Erma Pursley]

I am for the old medicare. Clinton made a mess out of this medicare by presenting a new form of medicare. Now this medicare advantage I am not for. They are hurting Seniors enough. I are one.

[Richard J Natale]

I went to HealthMarkets Care Assured breakfast at longhorns in Monroe NC They didnt tell the complete story on how there program worked, That Medicare card would no longer be used.So we got out of the program .they shouldnt be allowed to sell there programs to the public they said it was free but they controled what was paid and you didnt have any idea of what the charges were for the visite to the docter or what you would be billed for later.

[Susan]

I actually work for a company that helps administer the medicare advantage programs. The insurance company must follow all Medicare guidelines, so if Medicare would approve it so does the private ins. company have to approve it. What is most confusing is the co-pay issues, some are offered more insurance coverage for increased monthly payments. Believe me it is better to pay upfront costs than it is to have to pay higher co-pays when you have a health problem. So what the Insurance Company does promote is the lesser programs because it costs them less, but if you are presistant you can get the better coverage at less cost upfront.

[Cometa Wages]

I got the Advantage plan and it has already cost my handicaped daughter and I around $600 each. I hope this stops other from making the same mistake.