the New Medicare Mess
They said it couldn't be done. But through the concerted efforts of the
federal government and HMO executives, Medicare is now more confusing than ever before.
Here's a look at what's ahead.
most people on Medicare, all you have to do is sit tight and try not to get alarmed when
you get a brochure in the mail from the federal government explaining new choices for
Medicare coverage that you will supposedly have in early 1999. Don't take them too
seriously, because the choices in question haven't really panned out just yet. More on
that later - But for about 440,000 Medicare HMO members who have
just received notice that their health plan is dumping them at the end of the year,
they'll need to pay close attention to their options. Most will have the chance to switch
to another Medicare HMO, but 47,000 won't. Instead, those folks will have no choice but to
return to the world of regular Medicare.
If you're one of the dumpees, here are two things to
remember: No. 1, don't panic You'll still be insured through Medicare, although it
might cost you more money and, No. 2, don't quit your current HMO until the end of
the year, or you'll lose an important guarantee of Medigap coverage in the future.
The whole mess has come about because last year
Congress, in an attempt to save money on Medicare, changed the way it pays HMOs. Many of
the health plans have responded by canceling coverage for people in rural areas, where
reimbursement rates from the federal government are lowest. In fact, 43 health plans
quit the program altogether, and another 53 plans withdrew from certain areas.
This seems strange coming at a time when many health
plans are advertising and marketing heavily to Medicare recipients, luring them into their
health plans with promises of low costs and coverage of many items regular Medicare
doesn't pay for. Now many people, particularly those on limited incomes, have become
dependent on the low costs of a Medicare HMO and have accepted the trade-off of less
choice of doctors and other services.
Unfortunately, this constant change is a new reality in a health-care system that
relies so heavily on the marketplace: If a health plan cant make money, it drops
members. But don't be surprised if Congress beefs up
the amount it pays these HMOs and they start leafleting the town again, promising the
Meanwhile, the people losing their coverage have some
decisions to make. Here's what to know:
|You should receive a letter by Nov. 2
stating that your coverage has been terminated. Hold on to that letter, because you may
need it later. Also, check through the package for information about your options, such as
other HMOs you can join or available Medigap coverage. |
|Find out whether there are other Medicare HMOs
in your area. Check with a local senior center, with the state
health insurance assistance program (click your state flag) or in the Medicare Compare
listing of health plans on the agency's Web site. |
|While you're deciding, don't disenroll from your
old health plan, which must cover you until Dec. 31, 1998. Under federal law, if you
decide to go back to traditional Medicare and buy a Medigap supplemental policy, you
are guaranteed certain types of policies even if you have pre-existing health
|If you don't enroll in another HMO, you will
automatically be enrolled back in traditional Medicare. If you're worried about finding
another doctor, consumer advocates say that probably won't be a problem. In fact, your HMO
doctor may be available on a fee-for-service basis, and would probably be more than happy
to take care of you at the higher rates that traditional Medicare pays.|
for those folks who've gotten used to having their drugs mostly paid for by the HMO,
Medigap policies that include prescription coverage are expensive, and they are not among
the four types that must be made available to you if you've lost your HMO. To buy one of
those four (designated A, B, D or F), be sure you apply for the Medigap policy within
63 days after your HMO coverage terminates on Dec. 31, 1998. The insurance company
cannot deny you one of those policies based on your health or claims experience. If you
have a problem, be sure to get help from a senior center, state insurance or aging agency,
If you dropped a Medigap policy before joining your
HMO and want to return to it, you can do so if the insurance company is still selling that
policy, you haven't been in the HMO more than 12 months and if you disenroll from the HMO
before Dec. 31. But check with Medicare or an insurance counselor first. You should also
get help if you are enrolled in Part B of Medicare only, because you'll have to enroll in
a new HMO by Dec. 1.
Now, back to that brochure you're going to get about
new Medicare choices. Congress set up something called Medicare+Choice, which was supposed
to add new options for Medicare beneficiaries. For instance, they could switch over to a
Medical Savings Account, which uses an enrollee's Medicare contributions to buy a
high-deductible catastrophic plan, with the rest going into a tax-free account for medical
expenses. Or beneficiaries could join an HMO that is run by doctors and hospitals rather
than insurance company executives.
These programs were supposed to get started in early
1999, but they probably won't appear for quite some time. For one thing, there will
be no MSA option because none of the insurance companies decided it was financially
worthwhile to offer them. And most of the doctors and hospitals thinking about going into
the HMO business got cold feet, so only a few have applied to set up health plans.
So when you get the Medicare+Choice brochure in the
mail, don't take it too seriously. They just want you to know what the options are likely
to be in coming years. If you want to know more about it, check out Medicare's Web site and
look at the "Medicare and You" brochure.
resources of information: