OT:::::Medicare Advantage plans "are taking over Medicare and they are taking advantage of elderly patients,"

Bobo97272 wrote: ↑

Fri Dec 22, 2023 10:06 am

Assuming that the government medicare (original or traditional medicare) is administered efficiently and effectively , how is it that Advantage programs can offer the same care AND groceries etc for the same premimum (currently 165.00/month).

This is the beauty of markets. Suppliers have to compete with each other. They have to compete for business. They have to compete to be efficient.

Governments don't compete. They don't compete for business. The incentives to compete for efficiency are small. Government employees don't get bonuses, raises, and perks for competing. They don't get fired for not meeting goals. Tney don't attract the cream-of-the-crop employees.

The average payment to Medicare Advantage plans is about 4% more per covered individual as compared to traditional Medicare. This is about $400 per person. That doesn't pay for all the perks I take advantage of.

Should I mention that private suppliers have to cooperate? This is even more important than competition. Government suppliers just issue rules. They don't have to cooperate.

Interesting on the financial aspect.
One thing about traditional medicare is that they publish the provider's reimbursement schedule, while to the best on my understanding MA does not. So the patient has no idea how much his doctor is being paid for a service under MA, while the Trad Medicare patient does,

So where does the MA premium dollars go after all the advertising (competing against other MA plans), all the groceries, all the "freebies".
Maybe the way to balance the books is to pay doctors less (cut reimbursements) and or deny services.
Ya gotta balance the books!

dataq1 wrote: ↑

Fri Dec 22, 2023 3:51 pm

So the patient has no idea how much his doctor is being paid for a service under MA

You can call your insurance company in advance and ask. Or you can see it on your EOB.

ChicagoGranny wrote: ↑

Fri Dec 22, 2023 1:47 pm

The average payment to Medicare Advantage plans is about 4% more per covered individual as compared to traditional Medicare. This is about $400 per person.

Link Please. I gotta see where this is coming from. Link Please.

Penelope Wang of Consumer Reports addressed many of these questions/issues in an article that got updated in late 2022. It suggests that those in the rurals may have somewhat different concerns from those in more urban areas.

"For many seniors, Medicare Advantage plans can work well. A 2021 study in the Journal of the American Medical Association found that Advantage enrollees often receive more preventive care than those in traditional Medicare. But if you have chronic conditions or significant health needs, you may want to think twice. . . . 'It’s a riskier approach to health care,' Caughill [a co-founder of 65 Incorporated, a firm that provides Medicare enrollment guidance] says, which can also end up being more expensive. For example, a recent Kaiser study found that about half of all Medicare Advantage enrollees would end up paying more than those in traditional Medicare for a seven-day hospital stay. Medicare Advantage plans may be especially problematic for people in rural areas, says David Meyers, PhD, an sssistant professor of health services, policy, and practice at Brown University. A 2021 study he co-authored found that rural Medicare Advantage plan enrollees were nearly twice as likely to switch to Original Medicare as those in urban or suburban areas, possibly because the network of providers in rural areas is especially narrow, making it harder for people to make appointments and get care."

--The Pros and Cons of Medicare Advantage--Popular Advantage plans come with some risks. Here’s how to weigh your options.

By Penelope Wang
Updated November 3, 2022

--https://www.consumerreports.org/money/h ... 834167849/

Yup, as was said somewhere upthread

Medicare Advantage plans are great for SOME people, not so much for others.

Bobo97272 wrote: ↑

Fri Dec 22, 2023 10:06 am

Given all the freebee available on some Advantage, it's got to make you wonder how these are paid for. (freebee example: groceries mentioned earlier, gym memberships etc).

Assuming that the government medicare (original or traditional medicare) is administered efficiently and effectively , how is it that Advantage programs can offer the same care AND groceries etc for the same premimum (currently 165.00/month).

So, under the Advantage plans, the government sends 165/month of your SS benefits to a commercial insurer... hereupon that commercial insurer is providing you with same or better healthcare coverage AND groceries. That really doesn't make sense - either the government medicare plan is gouging people and making a profit OR the commercial insurance is not really providing the same or better healthcare coverage.

Ever notice that Traditional Medicare doesn't seem to spend $ on advertising, but commercial Advantage insurers sure do. Literally thousands of TV ads in the fall. The commercial insurer pays for all of that. Where does that money come from - out of your 165/month. If it is spent on advertising, it can't be available for your health care.

By coincidence I watched an MA education discussion on the internet by an Educator/insurance salesman. One point he made was that Medicare pays the Advantage plan about $1,000/month. They are officially allowed to apply 15%of that to overhead.
I have no way to verify this, but it seems plausible.

bwexler wrote: ↑

Fri Dec 22, 2023 9:20 pm

By coincidence I watched an MA education discussion on the internet by an Educator/insurance salesman. One point he made was that Medicare pays the Advantage plan about $1,000/month. They are officially allowed to apply 15%of that to overhead.

CMS pays 1K per month to an MA plan. Is that per enrollee per year, per month - or something else? If that is per month, it seems like that too much, if it is per year that actually seems too little.

Interesting that you should mention the 15%. In most of the states there is a 15% rule (I don't remember the name of the rule) but it basically says that ANY Healthcare insurance being marketed in that state must expend 85% of the premiums collected on direct health care.

A few years ago, BC/BS had to refund premiums to thousands of insured in New York because they hadn't expended 85% of the premiums on insured's health care. My Uncle got a premium refund check for 700 dollars.

A bit of research:

The overall cost of administering benefits for traditional Medicare is relatively low. In 2021, administrative expenses for traditional Medicare (plus CMS administration and oversight of Part D) totaled $10.8 billion, or 1.3% of total program spending - Kaiser Family Foundation

comparable estimate for Medicare Advantage plans, according to KFF analysis, medical loss ratios (medical claims covered by insurers as a share of total premiums income) averaged 83% for Medicare Advantage plans in 2020, which means that administrative expenses, including profits, were 17% for Medicare Advantage plans.

dataq1 wrote: ↑

Fri Dec 22, 2023 10:32 pm

CMS pays 1K per month to an MA plan. Is that per enrollee per year, per month - or something else? If that is per month, it seems like that too much

Approximately $1000 per month is correct. This is only 4% more than the government's cost of traditional Medicare. And it should be a big relief of the government's cost of processing traditional Medicare claims.

Research from both older and recent studies has consistently shown that Medicare Advantage plans tend to incur higher costs for the government and taxpayers compared to traditional Medicare per beneficiary. The additional cost in 2022 was approximately 4 percent, which is a decline from the peak of 17 percent observed in 2009. https://www.ehealthinsurance.com/medica ... ubsidized/

Hmmmm.
So lets see where the 65+ gang get the most "bang for their buck"

Traditional medicare overhead is approx 2%.
MA overhead (including profit) is approximately 17%

Of course the MA overhead includes profit for the commercial insurer, while traditional medicare has no profit.

Does that mean that MA insurance companies are making 15% profit?

I don't think you can tell, because MA companies may not be as efficient compared to traditional medicare, but one thing is absolutely sure. MA companies are in the business to make a profit, that profit has to come from the 65+ gang's premiums.

Applecheeks wrote: ↑

Sat Dec 23, 2023 10:33 am

MA companies are in the business to make a profit, that profit has to come from the 65+ gang's premiums.

Not necessarily, profit could also be made by kickbacks from providers.

dataq1 wrote: ↑

Sat Dec 23, 2023 10:38 am

Applecheeks wrote: ↑

Sat Dec 23, 2023 10:33 am

MA companies are in the business to make a profit, that profit has to come from the 65+ gang's premiums.

Not necessarily, profit could also be made by kickbacks from providers.

Or by disputing/refusing to pay claims that original Medicare might approve and pay.

I hope everyone here knows that almost all doctors and facilities in the U.S. accept traditional Medicare, as well as Medicare + a Medicare Supplement (sometimes called "Medigap") plan, whereas a substantially smaller subset accepts any given Medicare Advantage plan. In addition, Copays and Deductibles may be different with Medicare Advantage plans. Also, MOST Medicare Advantage plans are local to certain counties in one state. You can usually get out of area emergency room visits covered (minus a copay), but may not anything else - though that may vary with prescription drugs, which can be astonishingly expensive.

This is sometimes a very good deal. Most Medicare Advantage plans are cheaper than equivalent Medicare+Medicare supplement plans, and they may offer additional coverage, like dental, vision, and free membership in one or more gyms (called a fitness benefit). But in some regions, there may be no doctors or facilities in a particular specialty on your specific Advantage plan that are "in network", and/or accept that insurance.

Many (all?) Medicare Advantage plans only partially cover service from "out of network providers". E.g., I had an emergency room visit. My insurance from from United HealthCare (UHC) - but note that UHC has a huge number of different health insurance plans, and to some extent the selection is state and/or county specific. The hospital was covered (minus a $90 copay), but they called in an emergency care physician who was not. I also had a normal visit to another hospital. The facility fee and visit was covered, but not some of the lab tests and procedures were not.

And I had to have a surgery at one particular hospital which was not especially well rated by U.S. News and Report, nor was the specific department in which the surgery occurred, because none of the other facilities accepted that insurance. When you add the fact that non-emergency surgery currently has huge wait times (e.g., 1/2 year or more) at typical well rated hospitals, it can be quite expensive.

BTW, although not all doctors accept Medicaid, it is a great deal in many ways - they pay for everything they cover at all. And many people who are eligible for Medicaid don't realize it - e.g., if your adjusted gross income is low enough, and your are below 65, it doesn't matter what your assets are - e.g., you can have a significant retirement account. There are also Medicare+Medicaid Dual Advantage plans, which to some extent have the same advantages and disadvantages as Medicare vs Medicare Advantage.

I am still on a Medicare Advantage plan. I had to change from a Dual Medicare+Medicaid plan to a non-Dual plan when my state finally unwinded me from the COVID health emergency.

I'm not sure that was the best possible idea. If I ever want to switch to Medicare+Supplement, because there are (somewhat expensive) plans that cover more, I will have to undergo insurance "underwriting" by the chosen Supplement plan, which could lead to very expensive rates (because I have pre-existing conditions like sleep apnea), and long wait times on coverage for pre-existing conditions. (That fact varies by state. States that don't allow insurance companies to require underwriting have much more expensive Medicare Supplement plans.) It is possible I could overcome this requirement by moving out of the area covered by my current insurance plan.

I could switch Medicare Advantage plans during certain parts of the year without underwriting - but in my county, none of the Advantage plans I am eligible for are better than what I am on. If I moved to Baltimore County, there are much better plans, accepted by much better hospitals and perhaps better doctors, that I would be eligible to enroll in.

It all ends up being a very complicated business. You sort of have to guess what will be the best deal for you personally.