Intercst often points out that insurance companies skim 15% off Medicare Advantage, compared with the 2% cost of the government running traditional Medicare.
Here’s new information.
More expensive, less quality.
**Medicare Advantage Plans Often Deny Needed Care, Federal Report Finds**
**Investigators urged increased oversight of the program, saying that insurers deny tens of thousands of authorization requests annually.**
**By Reed Abelson, The New York Times, April 28, 2022**
**Every year, tens of thousands of people enrolled in private Medicare Advantage plans are denied necessary care that should be covered under the program, federal investigators concluded in a report published on Thursday.**
**The investigators urged Medicare officials to strengthen oversight of these private insurance plans, which provide benefits to 28 million older Americans, and called for increased enforcement against plans with a pattern of inappropriate denials.**
**Advantage plans have become an increasingly popular option among older Americans, offering privatized versions of Medicare that are frequently less expensive and provide a wider array of benefits than the traditional government-run program offers....**
**Tens of millions of denials are issued each year for both authorization and reimbursements, and audits of the private insurers show evidence of “widespread and persistent problems related to inappropriate denials of services and payment,” the investigators found....People signing up for Medicare Advantage are surrendering their right to have a doctor determine what is medically necessary, he said, rather than have the insurer decide....** [end quote]
The government report is a pdf file titled, “Some Medicare Advantage Organization Denials of Prior
Authorization Requests Raise Concerns About Beneficiary Access to Medically Necessary Care” which can be Googled.
Medicare is one of the biggest Macroeconomic concerns since the cost is a major part of U.S. government spending and a major part of financial planning for millions of people.
Medicare Advantage is aggressively pushed by insurance companies through mailings (snail mail for elders who presumable are less tech savvy) and even tables in Wal-Mart. Medicare Advantage covers expenses like hearing aids which can be expensive but aren’t covered by traditional Medicare. Also, traditional Medicare only covers 80% so “Medigap” private insurance must be purchased, which increases the cost. This makes Medicare Advantage tempting for lower-income beneficiaries, especially if they are relatively healthy.
The problem with Medicare Advantage arises when a person has serious health problems and/or is traveling out of state. Traditional Medicare is rock-solid – the doctor knows he will get paid and will decide what care is needed. Medicare Advantage is mediated by insurance companies that profit when care is denied.
I went to a presentation by a local insurance agency before deciding. He was very clear about his experience – traditional Medicare was better for serious health problems.
People who choose traditional Medicare must choose from several types of “Medigap” policies. I chose Part G after consulting with the local SHIBA volunteer. Part G pays for all expenses that qualify for Medicare coverage but aren’t paid by Medicare (such as the 20% and any excess charges). Our Part G Medigap policy is $202 each on top of the $170 Medicare Part B and our choice of Part D which is $11 per month (but could be much more expensive if we chose one that covered meds we don’t take). Plus we have to pay for our own glasses, hearing aids, dentures, orthotics, etc. which are expensive – sometimes thousands of dollars.
Health insurance in the U.S. is a nightmare. The Medicare system is much better than before Medicare, but there are still plenty of gotchas.