Millions of American who have become eligible for the heavily subsidized Medicare program are choosing to take a different route. There is a growing number of seniors who are enrolling in Medicare Advantage plans, despite funding cuts made by the Affordable Care Act (ACA) which experts predicted would curb enrollment numbers.
Medicare Advantage Plans are a substitute to the government-funded personal health plan of Medicare. In 2010, the ACA passed new measures that decreased billions in federal disbursements to the plans to help pay for those that did not have any insurance at all. Insurers ended up reducing benefits, leaving the business or left the states and moved on.
Recent numbers show more than 20 million people have enrolled in Advantage Plans, also known as Medicare Part C, since 2010. Meaning, more than a third of all Americans on Medicare are now enrolled in other plans compared to only one third before 2010.
Advantage Plans were not killed by the Affordable Care Act. It also looks like the plans are growing at a steady rate. Open enrolled will began again on October 15th and will run through December 7, 2018, and this year, there will be more choices from insurers. There will be 14 new insurance companies selling Advantage plans for the new year of 2019. Medicare and Medicaid Services has announced that beneficiaries will have about 3,700 plans to choose from in 2019.
Next year, 2019, a 12% increase is expected in Medicare Advantage enrollment plans, which totals nearly 23 million. They will also see better benefits and have lower or no premium payments. Each day about 10,000 baby boomers sign up for some sort of a Medicare Advantage Enrollment plan. With all these baby boomers opting to go with private plans, insurers are changing their tunes.
Other companies offering Medicare Advantage plans, for 2019 are Bright Health, Devoted Health, and Clover Health, which are all non-profit companies. A nonprofit hospital that is going to offer Advantage plans is BayCare Health system in Tampa, Florida. 2019 will be the first time the hospital is offering advantage plans. Mutual of Omaha will also be offering Advantage Plans in 2019. They are owned by their policyholders and they are opening up Medicare Advantage in San Antonio and Cincinnati.
Most counties in the United States have several Part C plans to choose from. The most popular have been for-profit companies like Humana, Aetna and UnitedHealthcare. They have been able to accumulate about half of all the national Medicare Advantage beneficiaries. Humana will be offering HMO plans in 14 states and 97 new counties. UnitedHealthcare is expanding into Minnesota for the first time where they have been headquartering the past four decades. They will also offer plans in 13 states and 130 new counties.
Medicare Advantage has helped give seniors access to medical benefits often left out of Original Medicare. Advantage Plans typically cover dental, vision, prescription drugs, and even may lower out-of-pocket expenses. Premiums and cost-sharing have become lower then what the government Medicare charges.
The difference is that with private plans, beneficiaries have to use approved doctors and hospitals. The private plans are subsidized by the federal government for the recipients. When the Affordable Care Act was being put together, Democratic lawmakers went after the Advantage Plans. They said it was because the plans cost 14% more for the government than the Original Medicare plan.
The Advantage plan still grew even with the billions in capital cuts. New Federal bonus money became available and the plans qualified for the bonuses as long as they had a score of 4 or more on a scale of 5, for customer satisfaction. Medicare plans also received hundreds of billions in extra revenue by distinguishing diseases and health risks of those they insured. The plans are then entitled to risk-adjustment payments. Some concerns have been raised that the insurers have embellished on how sick their members are.
Beneficiaries seem to stick to the plan they already have and are not easily persuaded to switch plans. Advantage plans are hoping to gain new members with low-cost plans that give them the choice of doctors and hospitals. They are also giving the members the right to see specialists without referrals from their doctor first. Plans are also going after the underserved people on government Medicare.
Many insurers are agreeing that there are plenty of opportunities for growth for years to come. The market share is plentiful and companies are not afraid to compete. Hospitals are involved with the government Medicare as well. It gives them the prime dollars that are directed to the cost of health care.
