Ask the Medicare Specialist

Question from Antionette: The advertisements I see for debit cards or an allowance that promises $2,000 to spend on groceries and utilities sound too good to be true. Is this on the up and up?

Answer: It is not. Nor, in my opinion, is most of the advertising for Medicare Advantage Plans that you see on TV, hear on the radio, or get solicitations for in the mail.

Many employ bait and switch tactics or attempt to get you to focus on what I call the "sizzle" so you ignore the risks that HMO and PPO plans can have.

Before I go further, I want to make a disclaimer: I'm not anti-Advantage Plan. Far from it. They're vital to millions of seniors, especially those on fixed incomes. A well-chosen Advantage Plan can save people who stay just relatively healthy tens of thousands of dollars in premiums over a five-to-ten-year period while providing valuable ancillary benefits, "extras," that neither Medicare nor a Supplement do. The Health Insurance Store has over 4,000 clients on HMOs and PPOs.

What frustrates and angers me is all the deceptive advertising and the abhorrent behavior of so many Medicare agents and agencies who continue to mislead and flat out lie to seniors for the sake of a commission. It's a huge problem. There's almost zero effective oversight by Medicare or from those of us in the industry and I'm not confident that's going to change anytime soon.

Let's address Antoinette's question. The benefit she referred to is only available for those who are "Dual Eligible," meaning eligible for both Medicare and Medicaid (Medical Assistance aka MA), and a very small percentage of American's qualify. In Pennsylvania and most other states, one's gross monthly income must be $1,255 or less for a one-person household or $1,703 for a married couple to receive MA. In addition, there's a limit on assets of $2,000 and $3,000, respectively. Those on Medicare who have cash or assets other than a home and an automobile which exceed those amounts don't qualify.

The goal of these advertisements is not to sell plans to people with Medical Assistance. It's to get seniors to call an 800 number and connect them to salespeople who have one job; Get the person on the other end of the phone to switch plans and generate a commission. They don't care if that's not in the best interest of the person on Medicare. We've met countless people who've been burned to the tune of thousands of dollars by getting talked into changing plans by some person at a "call center" as they're referred to. The salespeople are actually trained to get seniors to focus on the "sizzle," the free stuff or a refund of some or all their Part B premium. What they don't tell people is an outpatient surgery could cost $5,000 or more or a seven-day or longer hospital stay could have a co-pay of $2,000 to $4,000 compared to a couple hundred on the plan they're currently on. People in states outside of Pennsylvania are especially susceptible to extremely expensive inpatient hospital bills. I'm going to be writing about that on our Facebook group and possibly an upcoming column.

Another common advertising tactic is to get people to focus only on the zeros. Zero premium, zero co-pay at a primary care doctor, zero cost for select generic drugs. What those ads never mention is the possibility of meeting one's Maximum Out of Pocket (MOOP) if chemotherapy, other infusion or injection therapy, insulin for those with a pump are needed or if multiple seven day or longer hospitalizations occur. A MOOP can be as high as $9,350 in 2025. The average MOOP in Western PA is around $5,500 in 2025 and I've seen many plans outside of the region that will range from $7,000 to $9,000.

Maybe what bothers me the most are agents and brokers who never provide people turning 65 or are going on Medicare Part B for the first time with the Supplement option. Every day we meet people who had that choice taken from them by agents who only pitch Advantage Plans because the commissions are so much higher than Supplements. It's not explained that Advantage Plans aren't secondary to Medicare or there's only a six-to-12-month window to get a one without being discriminated against for current and previous health issues. I spoke with a client about three weeks ago who has Macular Degeneration and gets expensive shots in his eyes every four to six weeks. The agent he went to when he turned 65 didn't provide a Supplement as an option or tell him that with an Advantage Plan he'd pay 20% of the billable amount, around $600 every time he got his shots. By the time he spoke with met me, he couldn't get a Supplement, which in addition to Medicare would have paid 100% of the cost of those shots and almost every other covered service. Maybe even worse are agents who lie and tell people who currently have Supplements that Advantage Plans work the same, only cost less and come with ancillary benefits. We've met far too many clients who have had this happen to them.

Not only do you need to protect yourself, but you also need to help ensure your older parents, neighbors, aunts, and uncles don't fall prey. They are very often the victims of untrained and unscrupulous agents. Be advised that it can still happen after December 7th because in January what is known as the Open Enrollment Period (OEP) starts, when people can still change from one Advantage Plan to another. OEP is designed to allow people who feel they made a mistake by changing, or not changing plans, to correct it. However, these same selfish agents will use it as another opportunity to make a commission at your loved one's expense.