Traditional Medicare has advantages and disadvantages. Traditional Medicare involves Part A (hospitalization) Part B (doctors and clinics), Part D (drugs). Parts B and D require additional premiums. Furthermore, traditional Medicare has unlimited cost sharing, that runs 20% of the total cost. Most enrollees in traditional Medicare opt to buy a separate supplemental insurance policy to cover their cost sharing.
To limit what they spend out-of-pocket, traditional Medicare enrollees typically sign up for supplemental insurance, such as employer coverage or a private Medigap policy. If they are low-income, Medicaid may provide that supplemental coverage.
Medicare Advantage plans are growing in popularity due to the cost of traditional Medicare. Medicare Advantage are private plans that provide more benefits at a lower cost than traditional Medicare. This is what Kaiser Health News had to say about Medicare Advantage:
Enrollment in Medicare Advantage plans has grown substantially in the past few decades, enticing more than half of all eligible people, primarily those 65 or older, with low premium costs and perks like dental and vision insurance. And as the private plans’ share of the Medicare patient pie has ballooned to 30.8 million people, so too have concerns about the insurers’ aggressive sales tactics and misleading coverage claims.
One Medicare Advantage enrollee, named Richard Timmins, explained his decision:
“I listened to the insurance agent and, basically, he really promoted Medicare Advantage,” Timmins said. The agent described less expensive and broader coverage offered by the plans, which are funded largely by the government but administered by private insurance companies.
“It’s one of those things that people might like them on the front end because of their low to zero premiums and if they are getting a couple of these extra benefits — the vision, dental, that kind of thing,” said Christine Huberty, a lead benefit specialist supervising attorney for the Greater Wisconsin Agency on Aging Resources.
Although Medicare Advantage plans have many advantages, these plans are not without some drawbacks. Medicare Advantage plans are administered by private companies which have narrower provider networks and often require prior authorization for some treatments. As Timmins got older and his health deteriorated, he thought about switching back to traditional Medicare where he would have a much larger choice of health care providers. That is when he discovered a disadvantage of Medicare Advantage.
But, Meyers said, there’s a catch: While beneficiaries who enrolled first in traditional Medicare are guaranteed to qualify for a Medigap policy without pricing based on their medical history, Medigap insurers can deny coverage to beneficiaries transferring from Medicare Advantage plans or base their prices on medical underwriting.
Most states allow Medigap insurers to deny coverage to those who waited until they were sick to sign up for supplemental insurance. Only four states prohibit the practice, Connecticut, Maine, Massachusetts, and New York.
Traditional Medicare allows beneficiaries to go to nearly any doctor or hospital in the U.S., and in most cases enrollees do not need approval to get services.
“There are a lot of people that say, ‘Hey, I’d love to come back, but I can’t get Medigap anymore, or I’ll have to just pay a lot more,’” said Ginsburg, who is now a professor of health policy at the University of Southern California.
Many Medicare enrollees flock to Medicare Advantage plans for the enhanced benefits and cheaper premiums when they are healthy. They sometimes want to switch back to traditional Medicare when they later become less healthy. In the process, they sometimes find they are no longer a desirable customer for Medigap insurers, who either deny coverage or demand a premium much higher than seniors want to pay. That is a situation where it is hard to blame either party. Enrollees opt for cheaper premiums and richer benefits early on when they are healthy. Insurers not wanting high-cost, unprofitable enrollees who were not paying premiums while healthy. Rather than blame Medicare Advantage, policy makers should inform seniors about the trade-offs. Perhaps the free, enhanced benefits early on are not as desirable as the enhanced benefits later on. That is a decision every senior needs to consider.
I assumed YOU are BOUGHT off Devon by HMOs and Employer insurance groups, BLUE CROSS! YOU never mention them, that’s damn odd! These Blue Cross Medicare Advantage HMOs lure people into dangerous HMOs where some HMO employee decides what care you get when you get cancer. The cheap stuff. They promise BS stuff like $500 worth of dental discounts. I mean, really. Healthcare.gov doesn’t report that going out-of-network is NOT COVERED! they simply say N/A. What does that mean? For the last 3 years, we had the Medicare Advantage MSA that any senior with brain tumors could enroll and then use their choice of doctors and hospitals again. Remember, how I said there wasn’t (1) article in America about Medicare’s MSA being the solution to Medicare’s pre-existing problem. YOU never said a word.
Unfortunately, a For-Profit arm of the AMA, ZING HEALTH, purchased Lasso MSA and quietly shut it down so there is no competition to those DEADLY HMOs anymore so you are free to talk about them. Why did you refuse to mention the Medicare MSA? After all, Goodman calls himself the Father of MSAs. Goodman is the father who refuses to acknowledge the Medicare MSA, some father!
However, cancer patients on Medicare HMOs can switch to Medicare Advantage PPOs so there is that. Devon wants you to go with one company while you are healthy then when the senior gets cancer Devon wants them to switch to another company to pay the hefty medical bills! You are thinking like a medical doctor and not an insurance economist. Yup, it’s odd that in 30 years you have never mentioned what happens when an employee gets Ovarian Cancer.
Face it, Devon, YOU are a big piece of America’s brainwashing and keeping the nightmare of Employer-Based insurance in place! Many people have died because of you. Was it worth it? I’m probably banned again.
Ok Ron, you have my attention. If you were enrolling in Medicare today, what would you choose? A while back a neighbor asked me, and I have a couple relatives who will be enrolling in 2024.
Anyone else with ideas please weigh in as well. My relatives are healthy, with no pre-existing conditions but not everyone stays that way.
Devon, I don’t like talking to people over 65 because the Government insists that I must keep every conversation for 10 years and produce each recording should they ask. My partner Lee is involved and what he has told me is the government is now eliminating all insurance agents for people over 65. The FMOs, like the agent’s agency, has spent millions for the technology to do these recordings but the Biden’s CMS rules now eliminate FMOs from making any money on their agents. I will ask Lee to see what he would say. I’m inclined to say get a Medicare Supplement but Lee knows the ins and outs.
Granted Devon, we all know your relatives come from a very long line of dying people. Everybody has similar needs.
PS; Lee says the new CMS rules will now eliminate the 20 calls a day I get for Medicare Advantage. So that is the bright spot.
That would be a blockbuster for many agents if Medicare Advantage plans no longer paid commissions. I can name 50-100 agents just in MN who would be out of business, and/or lose the one asset they can sell to enable their retirement. This bears watching!
I seem to have the best of both worlds myself. I have a Blue Cross Medicare Advantage myself. I get the tiny deductibles, but my plan covers almost 100% of hospitals in the state, and a high percentage of doctors too. I have had three major surgeries since turning 65, and hardly ever received a bill.
I realize that a Medicare HMO could be more dangerous.
I started Medicare a couple of years ago, and choose a Supplemental Plan G mainly to keep my options open. It’s easier to move from a top-of-the-line Plan G to a less expensive supplemental or Advantage plan, than to go the other direction.
My supplemental is currently around $150 per month, but I’m in California. As I get older and the premiums increase, I’ll consider switching, either to an Advantage plan, or to a High-Deductible Plan G for $40 or 50 per month. But for now I’m covered if I move to another state etc.
If I lived in New York I would likely do the opposite, as guaranteed issue means that supplemental premiums are roughly double there, and that one can always start off with an Advantage plan and later switch to a supplemental when one’s health declines.