Medicare Disadvantage

[BobKamman]

I try to stay in my own lane when it comes to advice on health insurance, but when I see millionaire clients signed up for Medicare Advantage plans, I share my opinion.

Which is, Medicare Advantage is fine for poor people who can’t afford good health insurance, but only Depression babies and their offspring sign up for something that costs less but delivers uncertainty. The real “advantage” to turning 65 is that you can switch from HMO to PPO, by choosing Medicare Parts B and D with a supplement. Yes, it costs more, but what value do you put on your well-being?

I point out that all those ads they see in October's enrollment period are bought by insurance companies looking to turn a profit – with dollars that should be going to healthcare.

Today, an article in the Washington Post adds more reasons to avoid something that sounds good until it’s canceled.

“Medicare Advantage plans — the privatized version of Medicare — surged in popularity in the last two decades as companies enticed enrollees with things like zero-premium plans, gym memberships, allowances for over-the-counter medical supplies and vision and dental coverage.

“But over the last year, insurers sharply retreated from the plans in some regions, saying rising health care costs and reduced government reimbursements have hurt profitability. That left millions of elderly people scrambling to find alternatives.

“The shift highlights one of the risks for Medicare Advantage beneficiaries, especially in rural areas where options tend to be meager: plans are under no obligation to offer coverage year-to-year. When profit margins are threatened, insurance companies can suddenly withdraw coverage. This year the churn reached a peak.

“In all, almost 3 million people were forced off Medicare Advantage plans because their carriers pulled out of their counties, according to a recent analysis in the medical journal JAMA. Most affected seniors nationally had other Medicare Advantage options to choose from, but around 30,000 did not, according to a new analysis by KFF, a health research organization.”