I wrote previously urging people who have or have family members under Medicare to compare costs for Part D drug coverage every year before year end. When I went to check this year myself, I found that the Medicare website led me to compare plans that provided not only drug coverage but also Supplemental (Part B) coverage.
I was amazed to find plans that offered both drug and supplemental coverage for $0.00 monthly premium. I have been paying Blue Shield $178 per month for my Part B coverage and Advantrax $25 per month for drug coverage. The Medicare website showed me that next year Advantrax would charge me $41 per month plus add a $100 deductible. I don’t know what my Blue Shield payment will be, but I’m sure it will be more.
Before I turned 65, I was covered by Blue Shield for my medical insurance. As I approached 65, their sales representative sold me on one of their plans. According to my records, I initially paid, in 2002, about $85 per month. The amount rose steadily to the present $178 per month.
I called one of the zero-premium plans and asked if it is really had a zero premium, and how could this be. Perhaps you are like me and don’t understand that everyone who elects Part B coverage already pays $96.40 per month (deducted automatically from one’s Social Security payment). The representative explained that the government paid this amount to their plan to cover its costs.
I have now signed up for a zero-premium plan that covers provides both supplemental and drug coverage. I can go to any doctor (not just a doctor in the Blue network) that accepts their reimbursement schedule. Most, including my regular doctor do. I will fill my prescriptions at my regular pharmacy as before.
What do I lose by moving to the zero-premium plan? I now must copay $15 per office visit ($35 for specialists), whereas after the deductible, I paid nothing under my Blue Shield plan. It would be unusual if I had one doctor visit per month (annual physicals and flu-shot visits have no copay). If I did have a visit a month, I would copay $180 during the year. Otherwise, there are no extra costs that I can see. The drug copay is $5 for generic prescriptions, which are all that I have, and this is essentially the same as the plan that I am leaving. The hospitalization benefit is actually a bit better, because under the new plan, I pay $275 per day up to 6 days, rather than a flat $1068 upon hospital entry, with no cost thereafter.
I expect that I will save about $2,400 in 2010 because I took the time to review the alternatives: 12x($178+$41) – $180 = $2448.
If you haven’t already done so, find out your potential savings at the Medicare website for comparing plans.
My experience is more strong evidence of the need for a universal coverage national health plan. I am both an economist and a skilled analyst; yet over the years I clearly paid thousands of dollars more than needed for insurance coverage. If I am being “bilked” by the confusing array of insurance choices, how much worse off is the average consumer who likely buys what the insurance salesman recommends?
It is certainly good advice to Medicare beneficiaries to explore their options for covering Medicare deductibles and co-pays and for making an informed choice of a Part D prescription drug plan. But do very carefully read all the terms of any plan you are considering. And if there are provisions you don’t fully understand, ask someone who does (not the insurance agent selling the plan).
In exploring options on the Medicare website, it is important to distinguish between a) supplemental Medicare insurance plans and b) Medicare Avantage plans. Supplemental plans are just as the name suggests. They are a supplement to your traditional Medicare insurance. They cover some of the Medicare co-pays and deductibles and may include some additional coverage. The terms of these plans are regulated by the federal government and are quite straight forward.
Medicare Advantage (MA) plans replace your traditional Medicare plan. There are HMOs, PPOs and private fee-for-service MA plans.
The fee-for-service MA plans may not explain the limits of their coverage in plain English. For this reason, it is extremely important to understand the terms, conditions and limitations of their coverage. For example, what physicians (including specialists) you might want to use accept the MA plan’s terms and payments? What if you go to a physician who turns out not to accept the MA plan’s terms? [If the physician does not accept the terms of your MA plan, you will have to pay this physician out-of-pocket as you are not covered by traditional Medicare while you are enrolled in the MA plan. ] Does the plan cover Part D prescription drugs?
Here’s a good explanation of private fee-for-service Medicare Advantage plans:
http://www.kff.org/medicare/upload/7648.pdf
Pat