Maybe not an advantage

Faithful blog readers will know that there was a point in the past when UCOP seemed to have a plan to replace all retiree health plans with a single Medicare Advantage program. After a fuss was raised, Medicare Advantage was offered as an option. Still it is an attractive option because of the lower cost. Experts have suggested that the lower cost arises because of overpayment by the federal government to the private providers of Medicare Advantage plans, with the risk that someday Congress will step in and cut the de facto subsidy. 

As we have noted in prior posts, a majority of Medicare-eligibles are now in these privatized plans, probably a surprise to those who argue for "Medicare for All" as a public option for the general population. Here is (yet another) article on the subject from Newsweek:

In 2023, more than half of seniors were enrolled in Medicare Advantage plans. For many seniors, the plans hid some serious problems they only learned of later on. Seniors are routinely barraged with a range of Medicare Advantage ads, and they often sound too good to be true. Boasting better prices and a wide range of services, many seniors quickly decide to switch to a plan that saves them money upfront. "They're enticing because many do not charge premiums and include other services like dental care," attorney Loretta Kilday told Newsweek. "This simplicity and extra benefits prove to be a big draw, especially for people who do not have urgent health problems." ...

"Such plans tend to have small networks where specific services require prior approval, thus delaying treatment," Kilday said. "Seniors, especially when their health degrades more, they feel stuck in these plans."

According to a Senate Finance Committee report by Oregon Democratic U.S. Senator Ron Wyden, customer complaints about Medicare Advantage's marketing skyrocketed to double from 2020 to 2021, bringing the total to 41,000.

...And still, health insurance companies spend millions lobbying lawmakers, with one report finding $33 million was spent by insurers in just the first three quarters of 2023. Some Americans might not even be aware of the difference between traditional Medicare and privately run Medicare Advantage plans due to how widespread the ads for the latter are. Those who do end up signing up for Medicare often don't realize they gave up the larger Medicare provider network and can no longer choose the doctor they'd like until it's too late.

...Those who need expensive medical care in Medicare Advantage often have to wait for prior authorization approval, which adds an obstacle to their healthcare, something the marketers never mention. One in five seniors reported issues getting care due to the prior approval process, according to a recent Retirement Living study. Another study found half of beneficiaries switched to a different plan after five years...

Full story at https://www.newsweek.com/seniors-trapped-medicare-advantage-program-problems-1860014.