I’ve written before about Managing Someone Else’s Money. In addition to managing the daily aspects of my MIL’s money, we handle all the big issues, too. This weekend marks the start of the open enrollment period for Medicare and Medicare Advantage programs, and we will most likely be switching the MIL’s insurance.
This is the first in a series of posts I will be doing about the issue.
For background, I have 11 years experience working in health care. I was a medical receptionist from 1997-2001, which is the era Medicare Advantage plans first came on to the market. For the last 7 years, I have worked for a managed care organization that offers a Medicare Advantage product.
I know a lot about this subject, but am not an expert. I call and ask our sales teams (who have to be experts on our Medicare products) questions frequently. I will attempt to answer any questions you have, but know my answer might very well be: call your insurance company.
I also encourage anyone who will soon be switching to Medicare, or has a loved one who will be, to start researching your options in advance of the enrollment period. I have and MBA, and I do this for a living, and I still find certain aspects confusing. Trying to rush this decision can result in less than optimal care.
The first question you have to answer is- What is better, traditional Medicare or a Medicare Advantage product?
I’ll be honest, if you have TriCare or can afford one of the really good AARP (or other) secondary insurance plans, traditional Medicare is probably the way to go. Ten years ago, there Medicare billed these secondary insurances directly after paying its portion, and I can’t imagine that they’ve stopped doing that.
The only confusion that ever came up for any of the patients I dealt with at the time was the annual Medicare deductible. It was $100 and reset every January. Of the plans we worked with, only 3 of them actually covered the deductible, but about 75% of our patients wanted to argue that their plan did.
If you can’t afford a really good secondary insurance and aren’t retired military, a Medicare Advantage plan is probably going to be better for you. Plans range from “free” –i.e. the same cost as traditional Medicare- to as much as $200+ per month in premium.
Medicare Advantage plans are administered by private insurance companies instead of by the government. They are still subject to all the rules and regulations placed on Medicare by the government, but they are able to offer some extra services for the more expensive plans, or at least predictability that Medicare can not offer.
When you go see your doctor for an office visit, Medicare pays 80% of the Medicare allowable rate for the type of visit you had. These rates are determined on a yearly basis. The patient is then responsible for the remaining 20%. This is often an odd amount like $7.87 or $9.18.
Besides the funny amount, the patient is often unaware of how in depth their appointment might be- sometimes the doctor is to, because the patient comes in for a routine visit but needs a greater level of care. It is not until after the visit is over that the doctor’s office knows how much to charge the patient.
With a Medicare Advantage plan, the patient has the standardized co-pays that most of us have gotten used to with HMO and PPO plans. You know in advance how much money the visit will cost. And when living on a budget, there’s a lot to be said for predictability.
Another major difference is choice of doctors. With traditional Medicare, you can go to any doctor or specialist that accepts Medicare. This is generally a more expansive group than most other insurance networks have access to, and generally allows patients to keep all of the same providers they had before switching to Medicare.
At the same time, the patient’s PCP is almost always going to suggest they see a specialist the PCP has experience working with, one who is already in the smaller insurance networks the PCP usually operates in.
Getting in to see someone the PCP does not regularly work with can take more time and result in worse care, even if the specialist is supposed to be the best in their field. That is because the best care requires doctors to communicate, and communication is easer between doctors who have a history working together.
A Medicare Advantage plan limits you to the network of doctors signed on to that plan. It will be smaller than the traditional Medicare network. It just will. However, if you are switching to an MA plan provided by the same insurance carrier you already have, the likelihood of having to switch doctors is really low.
There is the benefit that all the doctors you see will be used to working with each other, easing any communications issues that might arise.
Many Medicare Advantage programs are HMO programs. They require prior authorization for medical procedures and hospital stays not done on an emergency basis. Many people think this results in them having more limited access to care than on traditional Medicare. This is NOT true.
This is where it is important to note that Medicare Advantage plans must adhere to all Medicare guidelines. They can not limit a patient’s access to any care that is covered by Medicare. They can give the patient better/more access than traditional Medicare but, by law, they can not give less.
Any procedure that Medicare has criteria for must be reviewed before Medicare will pay for it. You can search for Medicare criteria on the
CMS web site.
The only difference between Medicare Advantage programs and traditional Medicare, in this instance, is whether or not the review to make sure the patient meets criteria happens before or after the procedure takes place.
With a Medicare Advantage plan, the insurance company looks at the clinical criteria (determined by CMS – Centers for Medicare & Medicaid Services) in advance. They make sure the patient meets criteria before the procedure before the procedure takes place.
In the case of traditional Medicare, the patients doctor should be determining that the patient meets criteria before they do the procedure, but there is nothing that forces them to. When the claim is submitted to Medicare, Medicare will review the record to make sure the criteria were met. If they were not, Medicare will not pay the bill.
In my personal opinion, this is actually the one major advantage Medicare Advantage programs have over traditional Medicare. Personally, I would always like to know in advance if my insurance is going to cover something, rather than finding out after I have the bill from the hospital and physician.
If, after this, you have determined traditional Medicare is for you, make sure you do your research on any secondary insurance coverage you get. If you think a Medicare Advantage product better meets your needs, tune in next week for tips on finding the right MA plan for you.
