It’s not uncommon for a Medicare client to bring in a newspaper article about Medicare Advantage company being sued by the government to our appointment. The client usually proclaims he doesn’t want to work with that company. Fair enough, but I have to then explain that almost every Medicare Advantage company has a similar suit pending. If you want to work with an insurance company without any pending lawsuits, I’ll have a very hard time accommodating you.
Medicare Advantage, private Medicare, has a complicated history. It was meant to keep costs down and bring extra benefits to Medicare beneficiaries. When legislators introduced an opportunity for companies to get paid more money for sicker and lower-income patients, the companies went for the opportunity. So-called “risk adjustments” mean that if the company knows you have a lot of chronic conditions, they can get more money to take care of you. The lawsuits allege that companies started just assuming people were sicker when they were low-income. In general, that population of people does tend to have more chronic medical conditions.
If you enroll into a Medicare Advantage plan for the first time, the company is prohibited to ask you about your health as a basis for enrollment. They must take anyone on Medicare that lives in the service area. The insurance company then has to wait until you see a doctor to find out if you have diabetes, congestive heart failure, kidney disease. Once they know, they will eventually get paid more monthly to have you on their plan. But the government lags behind, so insurance companies got creative and extrapolated that their members were not all healthy.
It is unusual to have Medicare and be on Medicaid and be in perfect health. Most people have several conditions, and you can’t blame the insurance companies for wanting to be paid now for work they will be doing now, rather than waiting a few years.
How the insurance companies and the government work out payment really doesn’t impact you, the member. Research has consistently shown that Medicare Advantage members have a high level of customer satisfaction, often citing the extra benefits not found in government Medicare. You can’t turn on a TV during the daytime without hearing about the rich dental, vision, hearing and other benefits that may be available in your area.
I tell my client who brings in the news article about any insurance company lawsuit: “My job is to help you find the insurance that you feel the most comfortable with. There is no ‘best plan’ and I’ll show you many options available in your ZIP code. If you are uncomfortable working with X company because of their pending litigation, but they offer the richest benefits and lowest prices in your area – at least you have all the information and you can make the decision.”
If your ethics prevent you from working with X company, you need to know that almost every company is in the same boat. If you want to pay more for less benefits for the one, small company that hasn’t (yet) been snared in the risk adjustment upcoding mess, I’ll happily help you enroll. But the decision is an informed decision, that you have to make.
Does this mean that Medicare Supplement companies (often a different division of the above companies) are more ethical? Not necessarily. Google how many companies have denied ER visits because they deemed that you didn’t have a true emergency. Many Medicare Supplement companies are caught up in this imbroglio. My goal is to get you good coverage and let the litigation play out of its own.
Sylvia Gordon is co-founder of The Medicare Family, headquartered in Noblesville, where she educates thousands on Medicare and Social Security in all 50 states. You can learn more at TheMedicareFamily.com.