Medicare vs. Medicare Advantage

At this time of the year, those of us that are of the age, are being inundated with calls and TV advertisements concerning Medicare and specifically Medicare Advantage. I must receive 4 to 5 calls a day from someone in a “boiler room” offshore trying to get me to sign up to a Medicare Advantage Plan.

Over 50% of Medicare recipients are now in Medicare Advantage Programs compared to straight Medicare. Obviously, these programs are extremely profitable to those insurers that offer them otherwise they wouldn’t be spending the dollars that they are on advertisements, including direct calls.

I have written to the Director of The Centers for Medicare and Medicaid Services (CMS) concerning the phone calls relative to Medicare Advantage Programs. CMS has the power to regulate the companies providing Medicare Advantage Plans but apparently has chosen not to. CMS negotiates per member per month premiums that the Federal Government pays the Medicare Advantage Programs. It appears “intuitively obvious to the casual observer” that the Federal Government is paying these plans too much in premiums otherwise these plans would not be able to afford the television advertising or the call center cost promoting Medicare Advantage. It is obvious that these programs are extremely profitable or you would not have so many of them in the marketplace.

I have also written to the two Senators of Virginia but I have had no response from them or CMS.

I recently read an article by Selena Maranjian titled “The Little-Known Downsides of Medicare Advantage Plans.” She points out that there are “big upsides to Medicare Advantage plans, but they are not the best for everyone.”

Medicare Advantage Plans offer benefits such as vision, prescription drugs, dental and hearing that regular Medicare doesn’t. However, if you look at the fine points, these benefits are particularly limited and not all encompassing.

Another advantage of Medicare Advantage Plans is that the premiums are generally lower than regular Medicare and sometimes -0-. Expenses are also capped.

However, Medicare Advantage Plans have prior authorization requirements and referral requirements as well as deductibles. You are also limited to the network that the insurer provides. Sometimes that is a very small network of providers.

There are currently over 40 Medicare Advantage Plans across the country but they are not all equal.

The Regular Medicare ( Part A and B -hospital & physician) network is only limited by those providers that accept Medicare. No prior authorization is necessary. The current cost is $165.00 per month. You do need to purchase a Prescription plan {Part D) in order to have prescription benefits.

Regular Medicare pays 80% of your medical expenses. However, you can purchase a Supplemental Medicare Gap Plan to cover the remaining 20%. These supplemental plans are rated based upon your health and costs will vary significantly. However, a Supplemental Medicare Gap Plan will cover the remaining 20% of your medical expenses and you will not be out-of-pocket for any expense.

Those who have purchased a Medicare Advantage Plan and decide later to switch back to regular Medicare can. However, it may be impossible to purchase a Supplemental Medicare Gap Plan. That is dependent upon the private insurers and is not guaranteed.

It is obvious that there is not one plan that fits all. Generally, it is thought that Medicare Advantage Plans are for those who are healthy and don’t use many medical services.

Regular Medicare offers more flexibility but doesn’t have the basic vision, prescription, dental and hearing options that Medicare Advantage offers.

Choose wisely!

Jess Sweely

October 30, 2023