Changes are On the Way for Medicare Advantage – but Don’t Celebrate Too Soon, Says New York Times
The announcement came a few months ago (and we wrote about it on the Aging Options blog back in April): Medicare Advantage plans were about to change, expanding to offer a whole host of new services and benefits. Since then we’ve seen other articles touting these new perks, all of which are designed to shift more people into the private-insurance MA plans and out of traditional Medicare. But are these new benefits and services a good deal or not? Should you start planning now to change to an MA plan when open enrollment takes place this fall?
“New and Improved”
This recent article from the New York Times may not provide a definitive yes or no answer to that question, but we think it does an excellent job of explaining what’s going on behind the scenes with the “new and improved” Medicare Advantage plans. We’re going to be watching this evolving situation closely, because for now there appear to be more questions than there are answers; but from what we read in articles like the one in the New York Times, all this good news for MA policy-holders comes with a catch or two. Besides, some of those answers won’t be available to consumers until companies take the wraps off their plans come October.
The New York Times article appeared July 20, 2018, and was written by reporter Paula Span. She writes, “Did you fall in the bathroom and fracture your hip? Medicare, if you have it, will pay thousands of dollars for surgery to repair the injury and thousands more for your resulting hospital stay and rehab in a nursing home.” However, she adds, here’s the conundrum: “Medicare wouldn’t have paid $200 to have grab bars installed in your bathroom, or covered the cost of a $22-an-hour aide to assist you in the shower — measures that might have helped you avoid the accident.” According to Span, this approach to senior health care which doctors and patients have labelled as “narrow, often counterproductive,” has been the subject of feverish debate. One policy expert from the Kaiser Family Foundation gave a relevant example: “You don’t want somebody with asthma rushing to the emergency room with a breathing problem that could have been prevented with an air conditioner,” she said – yet Medicare won’t pay for an air conditioner, but they will cover costly emergency medicine.
“A Tectonic Shift” in Senior Health Care
All that, writes Span, may start to change this fall, at least for some Medicare Advantage policy-holders. Officials at CMS, the Centers for Medicare and Medicaid Services, have “reinterpreted” the notion of which supplemental benefits MA plans can offer. As a result, says the New York Times, “When Medicare’s open enrollment period begins on October 15, the private insurers that underwrite Advantage plans — which already lure seniors with things traditional Medicare can’t cover, like eyeglasses, hearing aids and gym memberships — will be free to add a long list of new benefits.”
Some of the examples include adult day care programs, home health care aides to help with activities of daily living like bathing and dressing, palliative care at home for some patients, home safety devices and modifications like grab bars and wheelchair ramps, and transportation to medical appointments. Additions like these to MA policies represent substantial change – what one geriatrician called “a tectonic plate shift” in senior health care.
“What I find most fundamental is the recognition, by C.M.S. and Congress, that this bright line between ‘medically necessary’ and things necessary to maintain health — like proper nutrition and transportation to a doctor’s office — is an illusion,” she said. In other words, either we can invest in “simple things” now or we’ll be paying for hospitalization and ER visits later.
So What’s the Catch?
So far it all sounds like good news for consumers, so why are some experts expressing caution about the new rules governing Medicare Advantage plans? As we read the New York Times article (and others in a similar vein), the worries seem to boil down to two areas. First, many experts on health care policy are asking, what will be the impact on traditional Medicare of this push toward MA plans? After all, Medicare still covers two-thirds of eligible seniors, but that number is shrinking, projected to drop below 60 percent in the next decade. “What particularly troubles skeptics,” says the New York Times, “is that these intended improvements completely bypass most Medicare beneficiaries — the two-thirds who have stuck with traditional Medicare.”
The second, are companies going to dangle some of these new perks in front of policy-holders one year only to eliminate or restrict their availability in subsequent years? There’s nothing in the new rules that seems to preclude that type of bait-and-switch. “Advantage plans could provide certain benefits one year, then withdraw them the next, in the same way that drug coverage shifts,” says the article. Medicare Advantage is already confusing, with 21 different plans, most offered by a handful of big insurance companies. The new features with potentially bewildering options are bound to make the choice more perplexing.
The Rest of the Story
For now, no one seems to have any definitive answers to these questions. In the words of reporter Paula Span in the New York Times, “since the more flexible rules permit but don’t require any of these new benefits, and since insurers won’t reveal the particulars until October, it’s not yet clear what they will offer — or whether these changes might weaken traditional Medicare.” We at AgingOption will be watching for more news about these new policy options to help you make an informed decision. Meanwhile, this is a good time remind you that, while medical coverage is essential to a secure retirement, it’s only one piece of the “retirement puzzle.” Unless your finances are protected, your legal plans well-crafted, your housing options clearly thought-out and your family well-informed about (and supportive of) your wishes, your retirement is at risk, whether you have good health care or not.
Please accept our invitation to come join Rajiv Nagaich live and in person at one of our highly popular LifePlanning Seminars where he will explain in entertaining detail our uniquely comprehensive approach to the art and science of retirement planning. There’s no cost and no obligation, simply a chance to have many of your retirement questions answered – including some you didn’t know you needed to ask! There are a series of upcoming seminars listed here on our Live Events page where you can also sign up for the event of your choice online (or call us for assistance). Come get the inside story of a retirement planning breakthrough with Rajiv Nagaich of AgingOptions.
(originally reported at www.nytimes.com)