Thinking About Health: Beware of sales pitches during Medicare’s open enrollment
October 24, 2014
Once again it's Medicare open enrollment season, the time for those on Medicare to choose how to cover the gaps in the government health program for seniors and people with disabilities. Once again beneficiaries in many parts of the country face a bewildering number of choices — far more than most of them can reasonably evaluate. It's no wonder studies show that beneficiaries stick with the same plan year after year even though they may be able to get something cheaper.
In New York City I have nearly 100 choices considering both Medicare Advantage plans and traditional Medigap policies, but I'm not about to switch. This year, though, I did a little "shopping" to help readers understand what they might confront should they wade into the thicket of options. They are especially plentiful for Medicare Advantage plans, a private managed-care arrangement that restricts the doctors and hospitals a person can use.
The usual flyers and brochures from sellers of Medicare Advantage plans began to arrive in the mail a few weeks ago. One nearly fooled me. It read, "Medicare Health Plan Information, Important Information Regarding 2015 Changes Enclosed." For a minute I thought it was Medicare contacting me to tell me I had to pay a higher monthly premium.
But it was only a "lead card" used by insurance agents and brokers to gather names of sales prospects. The card instructs recipients to send their names and phone numbers to the National Reply Center in Indianapolis. I've seen similar pitches from the National Reply Center for years. Presumably they've sent the names on to insurance sales agents.
Tip number one: Don't respond to vague solicitations like this or to solicitations directly from insurance companies for that matter unless you absolutely want an agent to come to your home and give you a pitch.
The brochure from Empire Blue Cross offered $23 premiums for its Medicare Advantage plan and said to ask for details. I did and got none. The phone intake worker said I had to give some personal data to get specific information from an agent on the phone. Or, she said, I could attend a seminar, one of those coffee klatches insurers have where they talk copays and deductibles over donuts and coffee and get people to sign up.
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UnitedHealthcare sent a classier brochure, an "invitation" to save the date for one of those coffee klatches. It was pushing its zero-premium plans but did advise "limitations, copayments and restrictions may apply." I know the real money action is not in a copayment, which is small fixed amount beneficiaries have to pay for services that require copays. But the big cost burden comes from coinsurance, the percentage of the bill the beneficiary has to pick up. The brochure said nothing about that.
The Medicare Handbook noted that United's zero premium plan comes with a 20 percent coinsurance obligation for chemo drugs, Part B drugs, which include those received for hospital outpatient care, and durable medical equipment like hospital beds. These are high-ticket items, and insurers are eager to transfer some of the cost to beneficiaries.
Tip number two: Be sure you know how much your coinsurance will be and what services it applies to. Company sales agents usually don't talk much about these at the coffee klatches. The other day I wandered into a sales presentation a representative of WellCare was giving to a group of seniors at a New York City food court. I asked the sales agent if he was going to talk about coinsurance. No, he replied. "We are only giving a summary of benefits here." If prospective buyers knew what they might have to pay for some of those benefits, maybe they wouldn't sign up.
I did get a United representative on the phone. He didn't seem to know a lot about the policies his company offered. I kept asking questions. Finally, he said drug expenses don't count toward the out-of-pocket maximum you have to pay. In other words, only medical expenses, not those for prescription drugs, count toward satisfying the maximum amount you have to pay out of pocket.
Tip number three: Understand what expenses do and don't count toward the maximum.
Tip number four: Don't fall for a plan just because it has a low or no monthly premium. You won't find out which plan is really cheaper until you use it and learn how it works when you get a chronic disease or a life-threatening illness. A low-premium plan may become very expensive if you need high-priced cancer drugs and have to pay 20 percent of the cost.
Once again my advice is buyer beware and consider the old-fashioned Medigap policies especially Plans F and C. They give you the most coverage and the most protection from unexpected or catastrophic expenses even if your monthly outlay is larger.