A Glimpse into the Medicare Maze

It would be a good guess that many people turning 65 next year are not only busy with the holidays, but also busy wielding their way through the maze of insurance options associated with Medicare. Hubby and I were right there along with them, although we thought we’d successfully made it to the end when my Medicare coverage began in May. We thought we’d done our homework, had gone to several presentations, so we thought we knew what we were doing for the near term when we signed up with a carrier who steered us to MedAdvantage.

Several things that came up during the past several months made us ask questions over and over about whether we’d made a bad decision, so we started asking questions again, this time opting to go to as expert advisors as we were able to find. Really, the way Medicare coverage options are written, it doesn’t matter how smart you are (or think you are). Even though you’re assured over and over that if you aren’t happy with the plan you choose, and that you can change anytime during the 6-week open enrollment period each November, I’m here to tell you that options you choose do matter more than you may realise. Be wary of anyone who works for the health coverage provider. It’s not as “cut and dried” as you may think, and definitely better to get information from experts working outside of the provider. 

Here’s what happened to me. I was diagnosed with Rheumatoid Arthritis in the summer of 2005.  Fortunately there are several medical treatments that, while they won’t cure it, they do help slow the progression so that many of us diagnosed with it now can continue to live a pretty normal life. But they’re expensive. Very expensive. And likely to stay that way. By December that same year, my Rheumatolist had determined my treatment and I’ve been giving myself weekly injections, combined with other drugs taken orally, ever since. My drug list is fairly long, and most though not all are available in generic form.

Last fall, as I was approaching my 65th birthday and eligibility for Medicare coverage, we began attending what we supposed were “ask and learn” sessions on Medicare options that we being funded by various Health providers. We outlined in detail the drugs I’m required to take each week for my RA, and the host brushed over the various questions on details, always steering us towards a Medicare Advantage Plan (MedAdvantage) with no monthly premium (beyond that automatically deducted from my Social Security). Under the “MedAdvantage” plan you’re automatically covered for Supplement D drugs listed by that provider. 

When we looked closely at what we did NOT have to pay, and added up the estimated co-pays for physicians, hospitals, and drugs for the year, it made sense to sign up for the Medadvantage plan. The money out of pocket for my coverage came out pretty closely the same under the Advantage plan as it would by signing up separately for a Part D Prescription drug plan. With all else being so close to equal, naturally we elected to go with the MedAdvantage plan, reasoning that it would eliminate the need to sign up for the Part B supplement separately at that time. Our assumption was that we would be able to switch to other options, if needed, at the end of the year. 

Due to several “flareups” during this summer, our physician discussed the possibility of switching to in-clinic infusion therapy every two months rather than weekly self-injections. This treatment is  covered by Medicare Part B and is reimbursible to the provider.  However, under the MedAdvantage plan, it would have cost us 30% of the drug cost (about $500) out of pocket,  plus office visit co-pay for each treatment just the same as if this treatment were not covered by Medicare Part B. 

Can you see where this is going? When they sell the MedAdvantage plans these facts are never brought out and it is not very easy to find these answers even when you question the marketers. This is what we wish we had known: If I’d purchased a Part B Medicare Supplement plan, the in-clinic treatment would have been completely covered with no extra cost to me.

With the approach of the open-enrollment period (November 15 through December 31), we began in late October consulting other experts to get help about our best options. We started at the County Aging Services division and ended up in the office of an independent insurance agency specialising in Medicare enrollment. What we learned was an eye opener.

If I had decided to continue with the MedAdvantage plan for the next year, I would be stuck with it and would not be able to switch easily to other options such a separate Part B Supplement and Part D plans in the future, at least not without answering a series of medical questions plus listing all my medications and pre-existing conditions. Then the provider would have the option of rejecting my application. This could be potentially very expensive as Medicare pays only 80% of most of the covered expenses.  

Those who sell you MedAdvantage plans will never mention that switching out of a MedAdvantage plan is not very simple after a year of enrollment. The insurance companies apparently make a lot of profit on the MedAdvantage plans since the benefits offered by the plan are not governed by the same rules as the Part B Supplement, and (and this is a big and) the insurance companies can set their own premiums and co-pay rates. That’s such an important distinction, it bears repeating: The insurance companies can set their own premiums and co-pay rates. Because of this, there is a strong push from the insurance companies to steer their customers to the MedAdvantage plans rather than the Supplement Plans.

Luckily for us, we found this out in time.  I’m still within the one-year enrollment period, and so the insurance company cannot deny my application for the Part B Supplement coverage.  So, I am switching from  MedAdvantage to the Part B Medicare Supplement and a separate Part D Prescription Drug plan. This is likely to be more expensive than the “zero premium” MedAdvantage plan for now, but when or if I decide to switch to Infusion treatment, the costs will be significantly less because I would not have to pay 30% of the drug cost on Medicare covered treatment. On a retirement income, that could be significant.

Our experience with the Medicare plans may not apply to everyone, but it shows that the rules are not all that clear, and you can’t depend on insurance salespeople to give you the whole story. While MedAdvantage seems to make sense in the beginning, you have to think what might happen should you be stricken with other health problems a few years down the road which may make it difficult for you to switch to the Part B supplement. It’s probably not a good idea to get stuck in MedAdvantage. 

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4 thoughts on “A Glimpse into the Medicare Maze

  1. I still don’t understand why the US government would let insurance companies handle these sorts of things. There’s obviously a conflict of interest as those companies are probably interested in making money than helping people. At least there should be strict regulations right down to the details, but noooo…

  2. Paul, I think it’s because our government operates more for the benefit of big business than for the people. The current administration is the worst example I can think of. It galls me that people apparently voted for Bush not once–anybody can make a mistake once–but TWICE! Who do you think wrote this complicated healthplan in the first place? Yup! The insurance industry! I almost didn’t rejoin AARP this year because they endorsed it!

  3. Thank you so much for this. I have one friend with parents in an Advantage plan, and I will send you a link to your page right away.

  4. Whew….my head is still spinning from sorting out Medicare, etc. for my husband, who turned 65 a week ago today.
    From being an RN and dealing with Medicare, etc. I felt I understood it all fairly well…but, pouring through all of it, I also found it to be a maze.
    I do plan to blog about it myself soon.

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