MEDICARE
DIS-ADVANTAGE
PLANS?
Bob Mason
Originally
published in Coastal Senior
(August 2007)
Medicare can be confusing
enough as it is. The past
few years Medicare has
gotten even more confusing
with new “Part D Drug Plans”
and the somewhat older
“Medicare Advantage Plans”
(which until recently had
been called Medicare+Choice
Plans). Whew.
To the chagrin of some
insurance professionals, I
am going to take a two-part
swipe at Medicare Advantage
Plans in this and my next
column. Medicare Advantage
Plans have been under
scrutiny lately, and for a
reason. If you are covered
by one (and I bet you are
not thrilled with it) or if
you are thinking of
switching to one read my
words carefully.
Very aggressive (as in
illegal) sales tactics have
lured some seniors to switch
to Advantage Plans, and then
when the bloom is off the
rose (and they realize
they’ve been hoodwinked)
many have difficulty backing
out.
First, a bit of background
on Medicare (I’ll try to
keep this simple). The law
divides Medicare into four
parts. Part A and Part B are
what many think of as
“traditional” Medicare.
Tried and true, they’ve been
around for years. Part C
covers Medicare Advantage
Plans (under my knife
below). Part D constitutes
the newer prescription drug
plans (I will not touch that
here).
Medicare Part A has been the
traditional route for
medical coverage needed by
the elderly and disabled in
medical facilities. Part B
applies to services provided
by physicians and other
medical practitioners, home
health services, durable
medical equipment and other
services not covered by Part
A. (For a more complete
discussion of Medicare
simply Google “Medicare” and
read until you drop).
When combined with good
Medicare supplemental
insurance policies
(popularly called Medigap
policies) and the new Part D
Drug plans, Part A and Part
B provide fairly complete
coverage. There are gaps,
however.
Traditional Medicare, for
example will not pay for
most dental care, vision
care, hearing care and
preventive care. On the
other hand, many Medicare
Advantage plans offer to
fill some of those gaps. But
at a cost (and often
hidden). For example there
may be higher coinsurance
amounts or deductibles, or
other restrictions on who
may provide services.
Some of the newer Medicare
Advantage Plans may be
patterned after health
maintenance organizations,
which offer a wide variety
of services as long as the
member uses participating
providers.
Other Advantage plans may be
patterned after preferred
provider organizations and
managed care organizations
that offer broader service
but hold down costs by
preapproving services or
placing other restrictions
on the medical providers.
Most of the abuses do not
involve these plans; they
usually involve a type
called a “Private
Fee-for-Service” plan. These
are sometimes called “PFFS
Plans”.
So what IS a PFFS
Plan? A PFFS Plan is a
health plan offered by a
private insurance company
under contract with the
Medicare program. This
insurance plan is not a
Medigap plan, and it works
very differently. You must
continue to pay the Medicare
Part B premium to
participate in the PFFS plan
in addition to any
additional premium the
Private-Fee-for-Service plan
may charge.
You may receive services
from any doctor, hospital or
other provider willing to
accept your PFFS plan’s
terms of payment. You may
get, say, dental coverage .
. . but end up paying very
high co-insurance amounts
for other services. Or you
may find that your favorite
doctor does not participate
in your Medicare Advantage
Plan. Or you may find that
you no longer have drug
coverage that you need.
Even though the marketing
problems have involved PFFS
Plans, do think very
carefully before switching
to any type of
Advantage Plan; the deal may
not be as “advantageous” as
it first seemed.
Recently Medicare Advantage
plans have come under close
scrutiny by authorities
after discovery of abusive
PFFS hard-sell tactics by
private insurers. In April,
two Wellcare insurance
salesmen were arrested in
Columbus, Georgia, for a
variety of aggressive and
fraudulent sales tactics,
including forging the
signatures of elderly
customers. Shortly after
that authorities arrested
another salesman after a
series of forgeries and
misrepresentations by the
salesman to residents of a
Suwanee (just north of
Atlanta)
nursing facility.
As a result of the increased
“heat” from regulators,
UnitedHealth Group Inc.,
Humana Inc., Wellcare Health
Plans Inc., Universal
American Financial Corp.,
Coventry Health Care Inc.,
Sterling Life Insurance Co.
and BlueCross BlueShield of
Tennessee recently agreed to
suspend marketing of private
fee-for-service Medicare
plans because of complaints
of deceptive practices by
some of their agents. The
suspensions will remain in
effect until regulators are
convinced that the companies
have cleaned up their sales
act.
That’s good news. The
problem is that many seniors
who are in Medicare
Advantage Plans and who may
want out are having a
terrible time trying to get
to the exit.
Stay tuned . . . I’ll cover
that in next month’s column.
In the meantime: Be careful.
Look carefully before
switching from traditional
Medicare to a Medicare
Advantage Plan.
Bob Mason, certified elder
law attorney by the National
Elder Law Foundation,
practices in Savannah,
Georgia, and Asheboro, North
Carolina. Email Bob at ram@masonlawpc.com or visit www.masonlawpc.com.
