Medicare prescription drug plans a concern for clients as well as agents

Editor's note: Part of a series on what Medicare clients want to know prior to this year's open enrollment period.

Craig Gussin isn’t only hearing from clients going into Medicare open enrollment season; he’s also hearing from his fellow Medicare agents as part of his involvement with several industry associations.

Gussin is president and CEO of Auerbach and Gussin in Carlsbad, Calif., in the San Diego metropolitan area.

“The comment I am hearing from agents is that this will be a tough Medicare season,” he told InsuranceNewsNet.

Medicare Advantage plans and prescription drug costs are top issues for Medicare clients and their advisors, Gussin said.

He said one big issue in his geographic area is that one of the biggest hospitals in San Diego, along with two of the biggest physician networks, announced they no longer will participate in Medicare Advantage plans because of their reimbursement rates. This is leaving clients scrambling to find alternate coverage.

“One big question in all this is whether other hospitals around here will do the same,” he said. “Clients are worried. You have clients who are paying anywhere from zero to $20 a month for their Medicare Advantage premiums and now their doctors won’t accept their plans. So they have to either switch doctors or go to a supplement that costs them more money. And clients don’t like either of those options.”

Gussin said agents in his area were notified that two carriers in his area will no longer pay commissions on their Medicare prescription drug plans.

“So the question for agents is, will we be able to afford to sell Medicare prescription plans because of how much time it takes to find the right plan for someone?”

Gussin said he also is concerned whether Medicare prescription drug plans will increase their premiums to cover the costs of some of the provisions in the Inflation Reduction Act.  Among the provisions taking effect in 2025 is a $2,000 annual cap on out-of-pocket Medicare prescription drug costs and a $35 out-of-pocket cap on insulin.

“When you start looking at this, insurance companies will ask themselves, ‘How can we afford this? Well, we’re going to afford this by increasing the premiums,’” he said. “Will Medicare Advantage plans do this? We don’t know yet.”

Gussin said a big part of this year’s Medicare enrollment period will be educating clients about their options, costs and networks.

“The biggest takeaway for us will be education. It’s the education process and trying to fit that square peg into the round hole.”

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Susan Rupe is editor in chief, magazine, for InsuranceNewsNet. She formerly served as communications director for an insurance agents' association and was an award-winning newspaper reporter and editor. Contact her at susan.rupe@innfeedback.com.