Improvements, drug pricing changes precede Medicare open enrollment

For the first time in a long time – maybe ever – significant changes have occurred under the Medicare umbrella that should improve enrollment procedures and drug pricing for seniors just as the open enrollment period gets underway.

In a recent webinar hosted by InsuranceNewsNet dubbed “Rethinking the senior market: A look at new products, Medicare challenges,” a panel of experts reviewed a number of new features, regulations, and laws that have responded to enrollee demands for change of the 57-year-old program.

First up was the BENES (Beneficiary Enrollment Notification and Eligibility Simplification) Act, signed into law earlier this year that updates Medicare enrollment rules for the first time in more than 50 years to end lengthy waits for coverage, expand critical administrative flexibilities, and inform future policymaking on enrollment period alignment.

Changes will 'make life easier'

“This is something agents should know about in terms of enrollments for Medicare,” said Joanne Giardini-Russell, CEO and “Medicare Nerd” at Giardini Medicare, in Michigan. “It's going to make life easier for all of us come January, which is phenomenal.”

The act eliminates the up to seven month-long wait for coverage that some experience when they sign up for Medicare. Beginning in 2023, Medicare coverage will begin the month after enrollment. It also reduces barriers to care by expanding Medicare’s authority to grant a Special Enrollment Period (SEP) for “exceptional circumstances.” A long-standing flexibility within Medicare Advantage and Part D, in 2023 this critical tool will be available to facilitate enrollments program-wide, enhancing beneficiary access and administrative consistency.

To further maximize coverage continuity and ease transitions, the act directs the Dept. of Health and Human Services (HHS) to find ways to align Medicare’s annual enrollment periods. HHS is to present these findings in a report to Congress by January 1.

Next up are all the changes to Medicare under the president’s Inflation Reduction Act.

“The Inflation Reduction Act did a number of things to change prescription drug benefits, whether that's on for the standalone prescription drug plans or for the Medicare Advantage plans that include prescription drugs,” said Craig Ritter, CEO of Ritter Insurance Marketing, a national FMO for life and health products specializing in the senior market, and a Managing Partner of Integrity Marketing Group, in Dallas.

Inflation Reduction Act cited

Ritter outlined several changes included in the Inflation Reduction Act including the insulin savings program, which was a pilot program now expanded to cover all Medicare Part D plans and all Medicare Advantage prescription drug plans.

“What that means is that for covered insulin, Medicare beneficiaries can get that insulin for no more than $35 per month, some of the plans offer it for even less,” he said.

The big change for 2024, he said, will be the elimination of the catastrophic coinsurance. Currently, the Medicare beneficiary pays 5% but starting in 2024, that will be eliminated and there'll be no cost sharing for the Medicare beneficiary.

All the three panelists decried the level of confusion and complexity in the Medicare market, partly spurred by the ubiquitous Medicare Advantage TV commercials featuring Joe Namath and other celebrities.

“The stress starts for everybody right now, including agents, but for the consumer that are sitting there watching Joe Namath and all that garbage, you know, it's they get in a tizzy,” said Giardini-Russell. “And you know if they're watching TV they think they're the only dumb person on the planet paying for health care. So our phones get ringing with questions like ‘Wait, what am I missing out on?’”

Still, they agreed that the Medicare Advantage market is growing rapidly and it behooves agents to be fully educated on the options and plans.

“From a business perspective, you have to follow the dollars,” said Mark A. Squires, owner and president of Wise Choices Financial, in Kansas City. “And if the dollars are trending toward Medicare Advantage, like it or not, that's something you need to be talking about.”

Squires said upper median buyers may soon be priced out of Medicare Supplement premiums and will turn to Advantage programs.

“So being more versed in the Medicare Advantage programs that are in your area, and making sure that you're doing that offering properly, is probably going to lead to more business for you,” he said.

Doug Bailey is a journalist and freelance writer who lives outside of Boston. He can be reached at [email protected].

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Doug Bailey is a journalist and freelance writer who lives outside of Boston. He can be reached at [email protected].