Medicare Advantage

As blog readers will know, open enrollment for emeriti and retirees was extended because of a dispute between UC-San Francisco health providers and UC's Medicare Advantage Plan. Such plans - essentially privatized Medicare - now account for over half of those covered by Medicare (seniors and disabled persons). Unlike the UC versions of Medicare Advantage, most of those under Medicare Advantage chose to have such coverage, often as a result of advertising on late night TV and mailers that flood the Postal Service around open enrollment time.

Medicare Advantage plans in principle are supposed to cover whatever traditional Medicare would and - in aeddition - have special offerings such as gym memberships. Insurance companies that offer Medicare Advantage plans receive premiums that are risk adjusted from Medicare. Apparently, they are sufficiently overpaid to make the advertising and solicitation of more enrollees attractive. The question is whether at some point, as the costs of the Medicare program rise, Congress will feel compelled to act and cut back the subsidy. There are also questions about how the plans perform when major illnesses require expensive treatments; do they really provide what traditional Medicare does? The plans have narrow networks which could lead to long waiting periods before treatment, for example. Or patients may encounter barriers when major illnesses arise.

While Congress in its present dysfunction is unlikely to respond, the Biden administration is reported to be cracking down on misleading advertising of Medicare Advantage plans. From KFF Health News and NPR:

After an unprecedented crackdown on misleading advertising claims by insurers selling private Medicare Advantage and drug plans, the Biden administration hopes to unleash a special weapon to make sure companies follow the new rules: you.

Officials at the Centers for Medicare & Medicaid Services are encouraging seniors and other members of the public to become fraud detectives by reporting misleading or deceptive sales tactics to 800-MEDICARE, the agency's 24-hour information hotline. Suspects include postcards designed to look like they're from the government and TV ads with celebrities promising benefits and low fees that are available only to some people in certain counties.

Specifically, you should watch out for sales pitches that:

• Suggest benefits are available to all who sign up when only some individuals qualify.
• Mention benefits that are not available in the service area where they are advertised (unless unavoidable because the media outlet covers multiple service areas).
• Use superlatives like "most" or "best" unless claims are backed up by data from the current or prior year.
• Claim unrealistic savings, such as $9,600 in drug savings, which apply only in rare circumstances.
• Market coverage without naming the plan.
• Display the official Medicare name, membership card, or logo without approval of CMS, the federal agency in charge of Medicare.
• Contact you if you're an Advantage or drug plan member and you told that plan not to notify you about other health insurance products.
• Pretend to be from the government-run Medicare program, which does not make unsolicited sales calls to beneficiaries...

Full story at https://www.npr.org/sections/health-shots/2023/11/30/1215968231/crackdown-medicare-advantage-sales-tactics.

Although this crackdown doesn't apply to UC plans, a re-look at the subsidy received by Medicare Advantage, could at some point make the plans more expensive to UC than at present. We've said this before, but with the current crackdown, it's worth repeating the message.