Minnesota seniors brace for seismic Medicare shift
An estimated 320,000 Minnesotans with Medicare Cost health plans must switch to a new policy because a federal law is eliminating the coverage next year across much of the state.
Starting this summer and continuing in recent weeks, insurers and the government have been sending a series of letters to beneficiaries about the transition. Marketing efforts by insurance companies have picked up as well, although full details about 2019 coverage options won't be available until next month.
"That's a large number of people to be making a change in one year," said
Insurers, consumer advocates and government officials say they're working to ease the pain.
Insurers can make detailed information about options for next year available on
Anxious for information
Cost plans have been around for a long time in
The distinction between Cost and Advantage health plans is lost on most consumers, since in both cases enrollees opt to receive their Medicare benefits via private insurers. One of the key differences is how insurance companies that sell the different plans get paid by the government -- a technical detail that helps explain the shift away from Cost plans.
With Medicare Advantage, insurers receive set per-member, per-month payments that put insurers at financial risk if patient expenses exceed expectations. Cost plans, as their name suggests, are paid based on their costs, with no set rate.
A federal law passed in 2003 created a competition requirement for Medicare Cost plans, which stipulated the plans could not be offered in service areas where there was significant competition from Medicare Advantage plans.
A bipartisan move
The government's push to "sunset" the Cost plans has spanned both Democratic and Republican administrations and hasn't really been a partisan issue, said
"The government is not trying to take away benefits," Creighton said. "What they are trying to do is simplify the administrative structure and have health plans take financial responsibility for managing the health care utilization of enrollees."
In
Cost plans will be eliminated for an estimated 320,000 people in 66 counties, including
For some, it's automatic
Over the past few weeks, insurers have been sending letters to a subset of Cost plan enrollees in these counties, explaining how they'll be automatically enrolled in a comparable Medicare Advantage plan unless they make a different choice. The government calls this process "deeming" -- since the plans are deemed comparable -- and state officials say up to 125,000 Minnesotans might be directed in this way toward new products from their current insurance company.
State officials advise consumers to make sure the new health plan is both affordable and provides access to their doctors, hospitals, medications and pharmacies.
"They need to make sure their provider is going to be in the network," said
People being deemed into coverage are free to shop around for a better option during open enrollment. Shopping might be even more important for the estimated 200,000 people or so who aren't being steered into a new health plan, and therefore must actively look for replacement coverage.
"If they don't make a decision before
Medicare Advantage plans won't be the only option for consumers.
Maher, the volunteer insurance counselor, said some might find a better fit if they stick with traditional Medicare and also purchase a Medicare supplemental policy, sometimes called a "Medigap" plan. The Cost plan transition creates a one-time chance, Maher added, for beneficiaries to buy Medigap coverage without being asked questions about their health status, which could block enrollment down the road.
Seniors this fall might find more health plan choices than in the past.
Some aren't thrilled with all this.
"We weren't even aware that it was coming, and we don't even know why," Tauer said. "What is it that changed?"
"Of course we are frustrated, because when we originally signed up for our supplemental plan we thought all our decisionmaking would be over," he said. "It is like starting from scratch."
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