During this time of year attention is focused on Medicare Advantage plans and Medicare Part D prescription plans during what is known as the Open Enrollment period. No matter how many times I describe the differences between Medicare Advantage and a Medicare Supplement plan I usually find it necessary to redefine the differences as clients struggle with decisions regarding these options which are the most common forms of healthcare insurance for senior adults. Commercials for many years have favored Advantage plans which are offered by private companies. Also some Medicare Advantage plans are the only plans offered to retirees on their company’s insurance. Depending on the bargaining power of the employer, benefits may be better under the corporate than under a plan obtained individually. Only recently I have noticed this year a few commercials for Medicare Supplements. The differences are important but can be confusing. Here are some things to know.
• Television commercials often compare Medicare Advantage plans to Basic Medicare without referencing the availability of Medicare Supplements.
A typical television commercial might begin by saying “you have Medicare Part A and Medicare Part B, but do you have the more complete form of Medicare under Medicare C?” This description implies that the insured does not have “full” Medicare coverage and avoids discussion of Medicare Supplements. Medicare C is simply another name for Medicare Advantage. Medicare Advantage and Medicare Supplement participants both can change their drug coverage if they wish and that is typically done now during the open enrollment period.
• Commercials indicate additional benefits you might receive if you sign up for a Medicare Advantage plan.
Usually I notice differences between a Medicare Supplement plan and a Medicare Advantage at a time when clients need serious medical attention. Medicare Advantage plans may have Silver Sneakers, Meals on Wheels (in some areas), and some limited reimbursement for eyeglasses or dental. It is true Medicare Supplement plans do not have these additions and premiums are generally higher. However, when a client is hospitalized for a lengthy period he/she is typically better off with a Medicare Supplement plan and, if he/she is in poor health generally it often is difficult because of medical underwriting to transfer to a Medicare Supplement later.
• Any provider that accepts Medicare must accept Medicare Supplement. This is not true of Medicare Advantage.
Medicare Advantage is really private insurance and depends on the health care provider — doctor or hospital — accepting that coverage. Medicare Supplement plans as to hospitalizations and most other services generally cover whatever basic Medicare does not. Medicare Advantage plans have recently come under fire for in some cases, using Artificial Intelligence (AI) and algorithms to determine whether a patient should continue in treatment. Medicare Supplements are generally more expensive but the coverage is more predictable.
• If you sign for a Medicare Advantage plan when you are already on a Medicare Supplement you may not be able to return to a Medicare Supplement later.
Generally speaking there is a window of time around your 65th birthday when you can choose initially to sign for a Medicare Supplement. A Medicare Supplement does what the name implies — it supplements the basic Medicare benefits that almost everyone age 65 or older is entitled to. The way it works is it states it covers “All” or “All but <a given amount>” for different services. Often I hear seniors state that, although the Medicare Supplement premium is higher, they left the hospital with nothing to be paid. That is because the Medicare Supplement, as the name implies, can pay all or most of what basic Medicare does not for hospital and similar care. On the other hand Medicare Advantage plans are all over the board as to what the plan pays. Transitioning back to a Medicare Supplement plan once you are in Medicare Advantage requires medical underwriting. People generally want to return to a Medicare Supplement when they are more seriously ill.
• Watch the wording in commercials.
A television commercial might state that, in some areas, you “might receive” certain benefits under Medicare Advantage. Watch the wording. There are wide variations.
If you are already in a Medicare Advantage plan you will likely be deciding during this time whether to stay or to move to another Medicare Advantage plan and your drug plan. If you are in a Medicare Supplement you might be choosing among various prescription plans. Try to choose wisely.
Janet Colliton, Esq. is a Certified Elder Law Attorney from the National Elder Law Foundation and limits her practice, Colliton Elder Law Assocs, PC, to elder law, special needs, guardianships, estate planning and estate administration with offices at 790 East Market St., Suite 250, West Chester, 610-436-6674, [email protected]. She is a member of the National Academy of Elder Law Attorneys and, with Jeffrey Jones, CSA, co-founder of Life Transition Services LLC, a service for families with long term care needs.
