Many Minnesotans must make Medicare switch — and it will cost them

Sept. 20--MANKATO -- An estimated 320,000 Minnesotans with Medicare Cost plans will see them soon disappear and are facing choices as they search for replacement plans.

Robin Thompson, with the Minnesota River Area Agency on Aging and supervisor of the Senior LinkAge Line in southwest Minnesota, said having that many people searching for new plans in the next few months is going to cause some stress and confusion and stretch the LinkAge Line staff.

"We certainly don't want anyone to panic," she said. They are adding temporary staff and extended hours to their call-in center. "But we know there are going to be long waits, so people should start in early."

Many of those losing their Cost plans are likely to switch to a Medicare Advantage plan or a "true supplement" plan that gives them a wider network but at an even higher cost.

Mankato insurance agent Mary McClure said the change is a big deal that will raise costs and require a lot of decisions to be made.

"It's crazy. Before I just looked at the drug plans for clients because that Cost plan was so prized by consumers. But now we're going to have to look at everything for every client."

Cost plans have been around since the 1970s in Minnesota. The policies are sold by only three insurers -- Blue Cross and Blue Shield of Minnesota, HealthPartners and Medica -- under the brands Platinum Blue, HealthPartners Freedom and Medica Prime Solution.

Congress has for years been trying to get rid of the Cost plans but have delayed a decision until recently. The Cost plans have been popular with consumers but more costly to the Medicare system because of the way they are reimbursed.

With Medicare Advantage plans the insurance company assumes more risk. With Cost plans Medicare covers more of the high-cost claims.

Thompson said details of the new plans that will be offered by insurance companies won't be available until Oct. 1.

'A ton of plans'

McClure said she and other agents haven't seen all of the information yet, but she's sure costs will rise substantially for many people.

"And there will be a ton of different plans available to people, so that will be confusing. Everyone and their brother will be coming out with a plan."

She said one of the big things people making the switch will have to look at is the networks they will be enrolled in. Those with the Cost plans have been used to a very broad network of providers, both in Minnesota and other states.

The Cost plans may still be available to people in 21 Minnesota counties, including Le Sueur and Sibley counties in this area. That's because the law allows them to continue if there isn't much competition from Medicare Advantage plans in the county.

But it's not clear if insurance companies will continue making the Cost plans available in all those 21 counties.

Thompson said it's important that people who now have Cost plans to watch their mailbox closely.

"People are starting to receive notices. They should read everything that comes from their plan," she said.

"Pay attention to what the letter says."

That's because some people may be automatically moved from their Cost plan to an Advantage plan. Blue Cross subscribers, for example, will likely be automatically moved to an Advantage plan. "People would have a right to continue with that or enroll with someone else," Thompson said.

Thompson warns that scammers could try to use the situation. She said people should give no private information to anyone who calls them -- your plan or the government will send you a notice by mail.

Thompson said people who are losing their Cost plans will have "guaranteed issue rights" to pick a new Medicare supplement plan without being asked any health questions and can't be denied coverage based on pre-existing conditions. But she said those rights aren't available if people drop their Cost plan before Nov. 2.

While the loss of Cost plans are a big deal in Minnesota, it's not an issue in most of the country because they are offered in few states.

"Most of the people who have Costs plans are in 10 states and more of them are in Minnesota than all of the other states combined. We were the first state to have them."

She said no one is exactly sure why the Cost plans are so big here but there is a leading theory: Minnesota has lots of snowbirds and unlike Advantage plans, the Cost plans allow people to see doctors out of the network in other states.

Follow Tim Krohn on Twitter @TimKrohn

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