Fall: The Choosing Season

[Gotadimple]

As those too young for Medicare go through the annual open enrollment, Medicare beneficiaries are on the receiving end of numerous offers of Medicare Advantage, or Supplement plans. Just as with the ACA, PPO choices are small and HMO Choices are growing.

Here is an interesting article from The Incidental Economist about the impact of Medicare Advantage on the overall cost of Medicare. In counties where Medicare Advantage is offered, traditional Medicare sees a reduction in enrollment and a reduction in claim costs - most attributable to how Medicare Advantage manages the health care outcomes, and negotiates the cost of health care with providers.

The two mysteries of Medicare | The Incidental Economist

This link showed up on today's blog post from the Oblivious Investor. I get that as an email feed.

- Rita

 

[haha]

As those too young for Medicare go through the annual open enrollment, Medicare beneficiaries are on the receiving end of numerous offers of Medicare Advantage, or Supplement plans. Just as with the ACA, PPO choices are small and HMO Choices are growing.

Here is an interesting article from The Incidental Economist about the impact of Medicare Advantage on the overall cost of Medicare. In counties where Medicare Advantage is offered, traditional Medicare sees a reduction in enrollment and a reduction in claim costs - most attributable to how Medicare Advantage manages the health care outcomes, and negotiates the cost of health care with providers.

The two mysteries of Medicare | The Incidental Economist

This link showed up on today's blog post from the Oblivious Investor. I get that as an email feed.

- Rita

Thanks Rita for flagging this. Excellent analysis.

Ha

 

[REWahoo]

Thanks Rita for flagging this. Excellent analysis.

+1

Very surprising info. When I went on Medicare five years ago I was sure Medicare Advantage plans were doomed for extinction.

 

[Gotadimple]

+1

Very surprising info. When I went on Medicare five years ago I was sure Medicare Advantage plans were doomed for extinction.

Nah. The dirty little secret is that the government gets its cake and can eat it as well. They offload the risk for caring for a beneficiary (except for those with kidney disease) to a private party by giving them MOST of the Part B premium, they get oversight on the private party (reporting and quality measures), and they keep the loose change.

On Traditional Medicare they get the cake: they get the $ which they give to private parties who pay the claims as a reimbursement, and they run studies on health outcomes. But they have to pay for all episodes of care, while the private party does manage health care outcomes, the financial incentives are miniscule.

So this is why single payor is not nearly as successful as private payor. And the economists have just proved it.

- Rita

 

[eytonxav]

I still do not see much of an advantage to a Medicare Advantage Plan vs traditional medicare + gap coverage + drug plan.

At least looking at the advantage plans provided by my former mega-corp, I could never justify spending significantly more for an advantage plan.

 

[Gotadimple]

I still do not see much of an advantage to a Medicare Advantage Plan vs traditional medicare + gap coverage + drug plan.

At least looking at the advantage plans provided by my former mega-corp, I could never justify spending significantly more for an advantage plan.

You are correct that some plans don't offer much for the premium the insurance company wants. And a group Medicare Advantage plan doesn't have to compete with the rest of the private market.

It depends on the private market. In a market with a large Medicare population you will find plans that have no premium, no deductible, low co-pays, and no cost for prescriptions plus Silver Sneakers or other gym memberships. The government expects a Medicare Advantage plan to do more than just cover what Medicare covers: they are looking for add-ons such as dental, vision, hearing aids, gym memberships, etc.

I've had both: a MA plan offered by my employer to retirees, and now a MA plan through the same carrier for less $. The employer insisted on lower deductibles and co-pays than what the carrier offered in the private market place. Great idea, but the retiree was paying about 30% more than the private market for the lower out of pocket.

Like everything - you gotta look at the details.

Rita