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Tuesday
Sep112018

Slight of Hand.....a Medicare Advantage

     For many years Seniors were somewhat reluctant to give up their "Traditional Medicare Entitlements" in favor of choosing the highly publicized "Medicare Advantage Plan".  Under this option, a private insurance carrier, like Blue Cross, contracts with Medicare to approve and pay for a complement of health services available to a policy holding Senior, in lieu of the services being made available directly from Medicare. Medicare,, in exchange for the Insurance Company assuming this obligation,  pays the Insurance Company a negotiated annual payment for each insured Senior.  The Insurance Companies have made a fortune providing these "Advantage Plan Policies", and, as such, each year they offer new "Advantage Plan" perks to  encourage existing "Advantage Plan" Seniors to switch Companies, as well as to persuade "Traditional Medicare" Seniors to accept their companies "Advantage Plan".

     The competition among Insurance Companies is fierce.  Much like to everyday "cell phone wars" there are gimmics and misrepresentations and outright fraud.  What there isn't is competition with the "Traditional Medicare' option.  Indeed although not publicized, our government wishes every Senior were on an "Advantage Plan".  From a deficit management perspective, it certainly makes sense.  Medicare would rather negotiate with 40 Insurance Companies once a year than try to contain the health spending habits of 50 million Seniors.  Yes, it is a biased metaphor, but it's like the Mafia Godfather, keeping all the foot soldiers in line by putting a few "enforcers" in the middle.  Indeed, the incentives are similar, in that Insurance Companies that don't squeeze their wards, wind up on a higher level hit list.

     This trickle down cost containment strategy is sufficiently oppressive to spawn a million personal tragedy stories and several opposition TV dramas, but it's not the only, in play, maneuver to minimize main street health cost.  Every Insurance Agent making a living selling Advantage Plans knows that the go to explanation for a Senior's anxiousness about trading away Traditional Medicare is that Medicare demands that a Senior can always return from Advantage to Traditional....great, objection overcome.  Except that this truth is often a hollow truth. The expanded real truth is that for most Seniors, Traditional Medicare without a Medicare Supplement Policy, to pick up costs not paid by Traditional Medicare, is an untenable risk.  And, surprised, surprise,  the Insurance Companies cannot prevent Seniors returning to Traditional Medicare, but if they prevent Seniors from obtaining a Supplement Policy they have de-facto locked the Senior until death do they part. 

     The mechanics for blocking Supplement Policies for dismayed Advantage Seniors are everywhere. Exorbitant Supplement Policy Premiums, underwriting prerogatives denying Seniors residing in Communal Housing, as well as rejections for those Seniors having utilized Home Health Services, these are obvious tools.  Fake News claims integrating Medicare and Obama Care, and conspiracy claims of Medicare insolvency are also standard fair.  It many States the Advantage Plan utilization rates are above 80%.  We're getting closer.  What is the old saying about "shooting fish in a barrel"? 

     Oh, Well.  There is nothing we can do about this, we live in a liberal democracy and CNN has convinced me that there is no point in my voting.  My State has been red/blue for a thousand years.

 

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