Monday, 22 October 2012
Medicare Enrollment Information: Part 4 - Advantage Plans
Medicare Advantage plans are even more complex than Part D (prescription drug) plans. There are many more possibilities, contingencies and convoluted requirements and if you are not careful, it will make you cry.
That said, it is not all that difficult (aside from choosing the best plan for your needs) to purchase an Advantage plan the first time. But if your plan shuts down (they do that from time to time) or you want to switch to a different Advantage plan or go back to traditional Medicare, it will be painful and you will need to be careful.
When you change anything in Advantage plans, there are pitfalls everywhere that can lead to losing coverage or paying more than you should. I cannot possibly cover everything and this post is intended to be an overview that will help the largest number of people.
Even so, it is way, way, way too long. It must be the longest post I've ever written (and I'm not proud of that). I've used as many bold headers as makes sense and my advice is to skip around to the parts you really want or need to know.
Like the drug plan with traditional Medicare, Advantage plans can and do change in large and small ways every year. Costs can increase, drugs may be added and removed, rules changed.
So if you have an Advantage plan now, it is critical that you find out from your provider how it has changed for 2013, and look for a new plan if need be.
WHAT IS MEDICARE ADVANTAGE
Medicare Advantage (also called Part C) is private health coverage that replaces traditional Medicare – that is, Parts A and B, Supplemental (Medigap) and – typically but not always - Part D (prescription drugs).
Advantage plans are available in most of the country, but not quite everywhere.
The plans are approved by Medicare and come in several flavors: Health Maintenance Organizations (HMO), Preferred Provider Organizations (PPO), Private Fee For Service plans (PFFS).
(There are a couple of others including Special Needs Plans (SNP) that cover certain severe or disabling conditions. You can find out more about those here.)
There are important differences among HMO, PPO and the less common PFFS Advantage plans. (In all cases, restrictions on choice of physicians, hospitals and other health care professionals do not apply in emergency situations.)
These three types of plans are quite different in the details. Read this medicare.gov section to learn how each handles physician and hospital choices, costs outside of the network, approvals, referrals, etc.
In the case of PPOs, there is an important caveat from Medicare.gov:
”Remember, if you join a PPO Plan that doesn't offer prescription drug coverage, you can't join a Medicare Prescription Drug Plan (Part D).”
PPO and PFFS plans are not the same as traditional Medicare; the plan, not Medicare, sets the amount of your payment share. Be certain you know the rules of your Advantage plan or you may be required to pay more for services.
WHAT DO ADVANTAGE PLANS COVER
Advantage plans are required to cover everything covered by traditional Medicare Parts A and B except hospice which is covered by Medicare even if you are in an Advantage plan. Plus, most Advantage plans cover prescription drugs.
Some Advantage plans may cover extras not available with traditional Medicare such as vision, dental and hearing care. And sometimes they throw in such add-ons as gym membership, over-the-counter drugs, alternative medical services (e.g. acupuncture) and wellness programs.
WHAT DO ADVANTAGE PLANS COST
You must pay traditional Medicare Part B premium although some Advantage plans will pay part or all of the Part B premium for you.
There may or may not be a premium for Advantage plans. When there is a premium, it will vary from state-to-state and even county-to-county within states. For nationally available Advantage plans, the average 2013 premium is $60.09. The average 2013 premium when plans with a zero premium are excluded is $88.
There may also be deductibles and copayments. These costs can differ dramatically from plan to plan but are often lower than traditional Medicare.
Plus, thanks to Obamacare, the Affordable Care Act, Advantage plans must set their annual maximum out-of-pocket costs at $6,700 or lower. (There is no limit with traditional Medicare.) The average of Medicare Advantage plans' out-of-pocket limit for 2013 is $4516.
WHO CAN PURCHASE MEDICARE ADVANTAGE PLANS
With some exceptions for Special Needs Plans, anyone who already has traditional Medicare Parts A and B and lives in an Advantage plan's coverage area is eligible for Medicare Advantage.
You cannot be denied Advantage plan coverage for any pre-existing condition except end-stage renal disease which has special requirements. Find out more here.
WHEN CAN I PURCHASE AN ADVANTAGE PLAN
There are several periods of time when you can join a Medicare Advantage program:
- When you first become eligible for Medicare - there is a seven month window from three months before you turn 65 through three months following that birthday month
- During the annual enrollment period – this year between 15 October and 7 December. Coverage will begin on 1 January 2013 if your request is made to the provider by 7 December 2012
In most cases, you must remain enrolled in an Advantage plan for a full year from the date your coverage begins. But there are some exceptions. You may join, switch or drop an Advantage plan during a “Special Enrollment Period” if:
- You move out of your plan's service area
- You have Medicaid
- You qualify for Extra Help (Contact Medicare if you believe you are eligible)
- You live in a nursing home or certain other institutions
Contact your provider to make changes under these circumstances.
When you purchase an Advantage plan the first time, you also have those 12 months to change your mind for any reason and return to traditional Medicare. You may be able to get back the same Medigap policy you had before joining an Advantage plan if it is still available.
However, the Medigap policy you purchase under this circumstance may not have a prescription drug plan even if you had it before but you can purchase a Part D plan.
(Dear god, can you stand all this? It is Byzantine and it is so unfair to elders.)
IMPORTANT: If you have retiree health care coverage from an employer, check with your plan administrator before signing up for any Medicare Advantage plan because it may affect your eligibility for your retiree benefits.
Five Star Enrollment Period
Each fall, Medicare rates Advantage programs with one to five stars – five being the epitome of excellence. As with Part D (prescription drug coverage) you may switch to a five-star program if one is available in your area.
You may do this one time only between 8 December 2012 and 30 November 2013.
IMPORTANT: Be aware that if the five-star Advantage program you switch to does not provide prescription drug coverage (and your previous coverage did), you will lose your drug coverage and will be required to wait until the next open enrollment period to purchase drug coverage.
Switching Back From Medicare Advantage to Traditional Medicare
If you want to switch from a Medicare Advantage program to traditional Medicare, you are allowed to do so between 1 January and 14 February, the Advantage Dis-enrollment period.
You will also have until 14 February to purchase a Part D (prescription drug) plan. Coverage of both will begin on the first day of the month after the provider receives your enrollment request.
You can also purchase a supplemental (Medigap) policy at this time.
UPDATE ON DIS-ENROLLMENT FROM AN ADVANTAGE PLAN
This switch is more complicated that I indicated above and you should instead read this Medicare Advantage Disenrollment Period brochure [pdf] from the Medicare Rights Center. It will thoroughly explain what you must do to leave an Advantage plan and return to traditional Medicare.
Here is what you cannot do during the 1 January to 14 February period:
• Cannot switch from traditional Medicare to an Advantage plan
• Cannot switch to a different Advantage plan
• Cannot switch from one Part D program to another
Sorting out Medicare enrollment periods and what you can do when can be confusing. The 12-page Understanding Medicare Enrollment Periods [pdf] can help.
HOW TO PURCHASE AN ADVANTAGE PLAN
No two Advantage plans are alike and in addition to different coverage, premiums, copays and deductibles, they have different rules that must be followed for payments to be made. Know the rules before you purchase.
Remember too that Advantage plans take the place of traditional Medicare: Parts A, B, D and supplemental (Medigap). Medigap plans work only with traditional Medicare. You cannot have both a traditional Medicare and an Advantage plan.
As with Part D (prescription drug) plans, the easiest (harumph!) way to find a Medicare Advantage plan to join is with the Medicare Plan Finder. Have your current plan details available along with a list of your drugs and dosages. A pad of paper and pen are good too.
Fill in your Zip Code and other information on the first few screens. The final screen – weirdly – will not list “Advantage” plans. Instead you have three choices:
Prescription Drug Plans (with Original Medicare)
Medicare Health Plans with drug coverage
Medicare Health Plans without drug coverage
Tick the box next to the second or third choice – whichever you want – and click the “Continue to Plan Results” button. In my case, there are 23 Advantage plans with drug coverage and 8 without.
The resulting chart will tell you the plans' names, premium price, deductibles, additional benefits (e.g. vision, hearing), estimated annual drug costs (if you selected a plan with drug coverage), and more.
Click the name of the plan for another page with more extensive information about benefits, costs, out-of-pocket limits and more along with telephone numbers to call the provider.
There are many details to be considered before purchasing an Advantage plan so visit the websites of the plans you are interested in and read all you can find about the coverage.
Call the companies and ask them to send the details of the plans you want to know more about. Ask questions. Keep notes of what you learn.
WHAT ARE THE ADVANTAGES OF ADVANTAGE PLANS
Advantage plans usually provide benefits that are not available with traditional Medicare – particularly dental, hearing and vision. Monthly premiums are often low and some may charge no monthly premium.
It may be easier for some people to have all their healthcare needs in one place rather than scattered among Medicare and private insurers for drugs and Medigap.
WHAT ARE DISADVANTAGES OF ADVANTAGE PLANS
Sometimes Medicare Advantage plans are too good to be true. Here are some of the issues Advantage members have reported over the years:
- Depending on deductibles and co-pays, care can cost more than it would under original Medicare
- Advantage plans are not stable and may suddenly cease coverage
- Because plans cover only certain doctors, the continuity of care can be broken when the plan drops a provider
- Members are restricted in their choices of doctors, hospitals and other providers
- It can be difficult to get care away from home
- The extra benefits offered sometimes turn out to be less than promised.
This list is adapted from a report by the Medicare Rights Center. [pdf]
I strongly urge you to be extremely careful when purchasing an Advantage plan. Also, this time of year, your snailmail box will be stuffed with brochures from Advantage plan providers promising you the moon for zero cost. Take that for what it's worth and do your homework.
Tomorrow, one last post in this series will be so much easier. A list of links to places where you can get online and in-person help with all your Medicare needs and questions.
Medicare Enrollment Information: Part 1 - The Basics
Medicare Enrollment Information: Part 2 - Medigap
Medicare Enrollment Information: Part 3 - Prescription Drugs
Medicare Enrollment Information: Part 5 - Where to Get Help
At The Elder Storytelling Place today: Marcy Belson: Memories of the Superdome