- MA plans generally have
lower premiums than MS plans.
- MA plan premiums are not
age rated (the insured pays the same premium whether age 65 or
95).
- Some MA plans include a
Medicare Prescription Drug Plan.
However, if a Medicare PDP is included, that portion of the
plan has co-pays and deductibles separate from medical expense
co-pays and deductibles and has the same "doughnut hole" or "gap"
as stand alone PDP plans.
- MA plans are medical plans
offered by private insurance companies that operate in place of
Original Medicare Parts A & B. The beneficiary does not lose
Original Medicare Parts A & B, but so long as enrolled in an
MA plan, claims will only be
received, reviewed and paid, if approved by the plan, by the
MA plan insurance company. Any
claims sent to Medicare will be rejected without review.
- Some MA plans have no
maximum annual out-of-pocket limits. The beneficiary is
liable for plan co-pays and deductibles without annual limits.
- Some MA plans require that
the beneficiary obtain all services from contracted providers
except bona fide emergency care.
- MS are not medical plans
but plans that supplement Original Medicare Parts A & B.
Medicare regulations specify plan design details and require that
MS be labeled A through L.
- In general, MS
beneficiaries pay higher premiums that are age banded and must
purchase a separate Medicare PDP plan but enjoy lower or no
co-pays and deductibles for medical expenses and have PDP
expenses that are similar if not the same as those with
MA plans that include PDP
within them.
Medicare Advantage Plans
have their place and for some are the preferred option. But
the buyer must understand plan limitations, some of which may be
significant.
It is my opinion that not only does Medicare steer the buyer
toward Medicare Advantage Plans,
but many private insurance companies fail to adequately disclose
the differences between Medicare
Advantage Plans and Medicare
Supplement Plans.
When MA buyers do become
disillusioned it is almost a given that both Medicare and the
company will claim that the problem was created by agent
misconduct. Perhaps?
When you delve into the fine details, it is my
opinion that it will become apparent that the genesis of the
problem is with Medicare AND the companies. Medicare pays
the companies monthly capitation rates of more than $800 per
Medicare Advantage Plan enrollee!
If a company enrolls 1,250 new beneficiaries their cash flow will
be increased by more than $1 MILLION a month. Selling
Medicare Supplement Plans to
1,250 enrollees will not likely increase the cash flow to the insurance
company $200,000.
Follow the money!
Jim Spahr/Petaluma, CA 2010 |
