By the time the open enrollment period for Medicare Advantage ends on Dec. 7, tens of thousands of area seniors will have signed up for the popular health insurance program.
It’s a period of high stakes for insurance companies, which compete vigorously in promoting their managed Medicare plans.
Experts say it’s important for seniors to review their options to make sure they’re selecting the best plan based on their medical and prescription-drug needs.
“Open enrollment is here for a reason. This is your time to actually explore to be able to make sure you’re getting the right plan for you, at the right cost with the right coverage,” said Bill Armbruster, the associate state director for AARP in New York.
That leaves insurance companies, seniors and the agencies to navigate a period of upheaval in the Medicare Advantage program.
“We had no idea that it was going to be so much, I think, turmoil in terms of the plans,” said Linda Carr, director of government sales for Independent Health.
Medicare Advantage plans are a type of Medicare insurance offered by companies that contract with the federal government. Created in 2003 to encourage private insurance companies to provide coverage to seniors, the plans enroll about 15 million seniors and disabled people today.
“The goal was to have better health outcomes and keep costs lower,” Armbruster said.
National enrollment in Medicare Advantage has nearly tripled over the last decade, and the plans are exceptionally well-liked in this region, where 54 percent of seniors enroll in managed Medicare plans.
The plans can provide gym memberships or vision plans, for example, and they can have lower out-of-pocket costs than traditional Medicare.
“It provides better services and additional benefits and quality care, including case management services and fitness benefits and other services that aren’t part of traditional Medicare,” said Donald Ingalls, vice president of federal and state relations for BlueCross BlueShield of Western New York, which has about 53,000 Medicare Advantage members.
However, the U.S. Department of Health and Human Services found, on average, a senior enrolled in a Medicare Advantage plan cost the federal government about 14 percent, or $1,280 annually, more to insure than a senior enrolled in traditional Medicare. That added up to $14 billion in higher annual payments.
As part of the Affordable Care Act, the federal government began reducing how much it pays private insurers through the Medicare Advantage program, bringing the payments in line with those for traditional Medicare, AARP’s Armbruster said.
The Centers for Medicaid and Medicare Services also began tying Medicare Advantage bonus payments to a star-rating system that measures the performance and member satisfaction of insurers.
“Those are hugely important to us. We’re talking eight-figure impact to have a star rating of four or higher,” said Roger Van Baaren, vice president of Medicare sales for Univera Healthcare, which has more than 18,000 Medicare Advantage members in the region.
Most prices rising
In this area, Medicare Advantage enrollees still have a number of options, and some plans are going down in price, but overall the cost to members here will rise by nearly 7 percent next year, according to a Buffalo News analysis of federal plan data.
For seniors in Erie County, the change in monthly premiums between 2014 and 2015 ranges from a $3 decline for one Today’s Options plan to an increase of $67 for a BlueCross BlueShield offering, according to the Centers for Medicare & Medicaid Services, or CMS.
“It’s not just when they turn 65. I recommend that they do it every year during the annual enrollment period,” said Raymond Hurd, regional administrator for CMS. “It’s really about assessing your personal health status.”
Considering all costs
It’s a daunting amount of information to decipher for seniors, but insurance company officials and consumer advocates say it’s important to keep in mind the monthly premium isn’t the full cost of the plan. Seniors need to be aware of co-pays, as well as how much they could have to pay before reaching their out-of-pocket maximum.
What else do seniors need to keep in mind as they’re choosing a plan? For one, make sure your doctors and specialists are within the network of your plan. Another point to consider is whether a senior is eligible to receive Medicare Advantage coverage through a former employer, and whether that provides a financial benefit to the enrollee.
In Erie County, a good source of unbiased information is the Senior Services Department.
Seniors also should be wary of Medicare scams, and AARP has a Fraud Watch Network with more details.
Insurance companies compete for seniors’ attention through dueling information sessions, fliers and newspaper ads. Independent Health, with more than 73,000 members in 2014, has the largest local program and its “RedShirt” marketing campaign grew out of early Medicare Advantage information sessions.
The Amherst-based insurer now focuses on providing individual sessions at seven locations in the area. “That drives people to our sites because they want the one-on-one attention,” said Carr, the Independent Health administrator.
“We had it before, through her work, and we were satisfied with their service and stuff,” said Lehman, whose wife, Felicia, is on COBRA because she isn’t 65 yet.
Marlene and Stephen Kotlowski of Alden stopped by because the premiums for their current Univera Healthcare insurance, through her former school district, are set to rise from $482 per month for the two of them to $738 per month. “It’s kind of a shock when you get the prices,” Stephen Kotlowski said.
After meeting with Cornelius DeLaney, a RedShirt, to discuss their options, the Kotlowskis said they feel they have enough information to compare the various plans and make a decision.
“We know exactly where to look and how to weigh it,” Marlene Kotlowski said.