We are in open enrollment season for health insurance. The Medicare Annual Enrollment Period started last week. The Affordable Care Act Open Enrollment Period starts next week. Many companies are offering their employees an open enrollment period sometime soon.
I just want to highlight a few things.
1) CHOICE IS TOUGH — we have a great deal of very good evidence that choice is really tough. People routinely make objectively bad, dominated choices. People are subject to known and predictable cognitive biases. Some new research by Brot-Goldberg et al that used automatic re-assignment in Medicare Part D to show that people have extremely short duration intense attention spikes when they get hit with the equivalent of a 2×4 across the nose; otherwise inertia wins.
2) Get help! Insurance is complex and complicated. Most people shockingly don’t spend 40+ hours a week thinking about health insurance for a decade or more and find it interesting enough to get a PhD on the subject. Navigators and assisters are helpful as we speak a weird language that is complex even within our jargon. Brokers who are interested in long term relationships have strong incentives to make decent enough to good enough choices. Let’s talk in comments!
3) Satifice — Good enough can be more than good enough. Unless you are a medical trainwreck with a diagnosis history longer than a CVS receipt (Hi Mom!), you’re operating in a world of uncertainty. You don’t know for sure what next year could look like. Make reasonable guesses that are defined by your capability to absorb losses and value on different criteria (network, doctor relationships, ease of use, costs, predictability etc). The goal is not to get a perfect retrospective choice but a good enough prospective choice. Let’s avoid the absolutely hideous and bad choices and call it a good win.
4) Give yourself grace — this is a tough decision.
raven
Stay away from medicare advantage plans!
unrelatedwaffe
The fact that our system is advanced betting on our own health is so deeply stupid. I cannot believe the number of people in this country that have been brainwashed into thinking this system is great and single payer would be worse in any way.
Betsy
@unrelatedwaffe: Exactly. The whole shell game is idiotic. Here we are struggling to figure it out with our literacy and other fancy skills and then I can hardly bear to think how someone with cognitive challenges or any kind of complicated life can even manage.
My theory is that we just love suffering in this country. Look at all the bullshit we put Americans through.
The annual “healthcare” re-enrollment BS is just another way of ensuring that no one gets anything nice without at least a little struggle.
Flex Spending Accounts and Daylight Savings Time changes — more minor but illustrative examples of this phenomenon.
There are also things a lot worse, like the nasty hurdles that people have to go through just to get a few dollars of TANF or WIC — or to obtain some parsimonious little trickle of unemployment insurance benefits (that end after 12 weeks in the more puritanical, suffering-oriented states).
The Castle
I’ve always wanted to ask – as the de facto government shutdown drags on, and thinking ahead, does this have any effect on the ACA health insurance space? The broader health care space? What breaks first if this lasts indefinitely?
Betty
A broken health care system with no relief in sight.
Butch
@raven: I have Medicare Advantage and I keep reading that they’re a bad idea. I’m not sure why and I’m not clear what changes if I quit Advantage. I know I’d have to sign up for Part D because I do have prescriptions but I don’t understand beyond that.
Steeplejack
I feel like I ask this every year, so maybe I should make a mental note on paper. If I don’t do anything, my current Medicare plan just continues?
Steeplejack
@raven:
I have an Advantage plan with Kaiser Permanente, and I like it fine. I think the difference is that Kaiser is an HMO with its own medical facilities and doctors. They’re not just slapping on a surcharge and referring you to “regular” doctors who happen to be in some plan.
Yarrow
@Butch: If you quit the Medicare Advantage plans and go back to regular Medicare it’s harder to get a supplement. I think you have to undergo underwriting or something. David Anderson or others will know more. I think if you’ve had the MA plan for less than a year you can go back to regular Medicare without a penalty.
MA plans are okay if you’re mostly healthy. Basic things are covered and you get some goodies like Silver Sneakers or car rides to doctor’s appointments, etc. But once you need more care they don’t cover nearly as much as regular Medicare does, from what I’ve been told.
Some people have had better luck with them but in the case of the people I’ve been helping, all the doctors, hospitals, skilled nursing, rehab, etc. just said they wish the people had regular Medicare. It covers more and is so much less hassle. One person was stuck in the hospital for the weekend because insurance companies don’t work on weekends so they couldn’t approve transfer to rehab. I heard that from everyone in every step along the way.
Old Man Shadow
Your insurance provider has many options available that will meet your need to be viciously screwed over in ways individually tailored to you and your family.
David Anderson
@Steeplejack: correct
NeenerNeener
I signed up for an Advantage plan last month when I retired. So far, so good, but I’ve gone with Amazon Pharmacy and CostPlus Drug for my prescriptions because they’re cheaper for the stuff I have to take. I just wish the robo calls from brokers would stop. They’re coming about one every 90 minutes right now.
Butch
@NeenerNeener: I get calls from Humana all the time, things like “tell us about your recent doctor visit,” and the agent was a little surprised when my response was “what the hell are you going to do about it?”
Zelma
I’ve been on regular Medicare for 15 years with a supplement from the evil United Health Care. Also have my Part D through them. I have never had a single problem with them. Sometimes I’m envious of my friends who have Advantage plans and pay so little. But then I hear their stories about accessing care and I decide the high premiums are worth the peace of mind.
However, the Part D premium nearly doubled this year. To the best of my knowledge and based on my year end statements, UHC has not paid a penny for my drugs in over a decade. I wonder why the premium has jumped and whether I should look for another provided. I probably won’t. But I do wonder why the increase.
Sure Lurkalot
@Steeplejack: Re Kaiser Medicare Advantage: what happens if you have a medical issue outside of the 8 states that Kaiser operates in? My SIL was faced with paying full price for a surgery or flying home.
p.a.
IIRC, a real MA issue comes in our “last mile”. I believe there’s statistically significant evidence MA dumps its subs into Medicare for the last, let’s say year, of life, when the med costs tend to skyrocket.
NoraLenderbee
I’m facing this decision for 2024, and having some trouble getting information. I’m in California. When I go through the Covered California web site, plug in personal info, and look for specific plans, the results all say things like “Blue Cross XYZ premium costs $1234 per month, *if* you are eligible for $789 in financial assistance.” But I can’t find out what it would actually cost or whether I’m eligible for assistance. I can enter any number I want for annual income and the results vary by over $1000 per month.
How do they verify your income? And how far back do they go? I was well-paid most of this year, but I’ve been laid off and anticipate much lower income for 2024.
Butch
I just checked Part D premiums and they’re way more than I’m paying for Advantage, so now I’m doubly confused.
Steeplejack
@David Anderson:
Thanks! Note noted.
Ohio Mom
@Butch: As someone else said, Advantage plans are fine when you are relatively young and healthy. They operate like an HMO, with a limited stable of doctors.
But one day you will be older and maybe you’ve acquired a weird medical condition and the specialist who knows all about it isn’t in your Advantage network (true story, my BIL is slowly figuring this out).
The pluses of Advantage plans is that you don’t have to make as many decisions as with traditional Medicare plans. And they seem cheaper (more on that later).
Traditional Medicare consists of four parts: Part A and B, and monthly premiums for Part B will be deducted from your monthly Social Security retirement benefit. No decisions here, these are automatic.
Part D, which covers drugs. Picking one of these is fairly easy. There’s a computer site where you type in your address and all the drugs you take regularly.
Then the site does its magic and tells you what plans would be cheapest at what area pharmacy. My maintenance prescriptions haven’t changed but somehow every year I switch drug plans. Still going to the same pharmacy, the one closest to my house with the gracious pharmacist and grumpy tech.
Now comes the tricky part, the Gap plan. Traditional Medicare pays 80%. Okay, you saw the doctor, the bill is $300 and twenty percent is $60 and you say, Sure, I can pay that.
But now you’re in the hospital and 20% of the gazillion dollars the bill comes out to is a LOT. Gulp!
That’s where the Gap plan comes in, it covers the 20% gap. I buy mine through AARP.
The catch about Gap plans is, they can use your pre-existing conditions against you, if you have been on an Advantage plan for more than a year when you decide to switch to traditional Medicare. The insurers offering Gap plans can say, Whoa, looks like you acquired a weird disease last year, we are going to charge you a lot for that Gap plan. Or they may say, Nope, not offering you a Gap plan at any price.
Now, if you choose traditional Medicare from the start (or switch from an Advantage plan after the first year), Gap insurers can’t hold your pre-existing conditions against you.
Don’t try to find any logic here.
Finally, it may look like Advantage plans are cheaper but later on they can become more expensive. But that explanation is for another day.
Yutsano
The Federal Employee Health Benefits Program opens up here soon too. It’s…a lot.
Barbara
@Yarrow: You might have to undergo underwriting for Medicare supplemental coverage, but it’s not a foregone conclusion, so if someone really wants to go back to regular Medicare they should not assume it will be harder to get coverage. Plus, even with underwriting, a Medicare supplemental plan might not be that expensive.
Barbara
@NeenerNeener: Robocalls from brokers really makes me angry. They are ILLEGAL unless you specifically signed up to permit someone to call you. Not to make your life more difficult, but if you are so inclined you might want to save these and make a formal complaint. It is illegal for MA brokers or MA plans to make cold calls to Medicare beneficiaries.
Barbara
@Butch: They do that as a hook for getting past clear rules that make it illegal for them to call you out of the blue solely for marketing purposes. They are allowed to call you about other “plan related” purposes. So annoying.
Steeplejack
@Sure Lurkalot:
I don’t know all the fine details, but Kaiser does have arrangements for “out of area” care. Typically it would be for urgent and/or emergency care. I took a quick look at my Kaiser site, and there is a lot of information about getting care out of area, including being hospitalized for something, that Kaiser will cover.
I’m not sure what “paying full price for a surgery or flying home” conveys. I assume the surgery was unplanned, so I don’t know why it wouldn’t be covered as an emergency.
Barbara
@Zelma: The premium increases not based on your experience but collective experience. There are a number of regulatory and drug pricing trends that are contributing to higher Part D premiums.
Barbara
@p.a.: MA plans can’t dump you. What happens is that as people get sicker they get more resistant to MA type “management” and go back to regular Medicare.
Barbara
@NoraLenderbee: Are you looking for an MA or an ACA plan?
Barbara
@Butch: Okay, the higher math of the MA program is that MA plans can use their “savings” over traditional Medicare to fund premiums, as well as the other kinds of benefits like vision or dental that aren’t covered by regular Medicare. There is no fee for service alternative to Part D coverage, so there is no way to “fund” the premiums. All Part D plans charge a premium. Yes, it’s confusing but there is an underlying actuarial logic to what is going on.
NoraLenderbee
@Barbara:
ACA. I’m not 65 yet.
sab
@Steeplejack: My husband has medicare advantage with an insurance company with ties to our biggest hospital. It has been great, and he has serious health issues.
I have medicare and a supplemental because my health issues are heart related, so when I need medical care I need it now, and so I need a nationwide network in case we ever travel again.
Barbara
@sab: If you are happy with what you have, then by all means keep it. However, there are MA plans that have nationwide networks. If you are worried about emergency care, that will be covered as well, though I agree that MA plans are more likely to contest whether something was actually an emergency.
Sure Lurkalot
@Steeplejack: SIL fell and injured her elbow at home and believing it was not serious, flew to visit her parents in non-Kaiser state. Intense pain, emergency room visit indicated she needed surgery to remedy. Was then told she was out of network and the surgery wouldn’t be covered.
So I’m assuming it fell into the basket of what’s an emergency. Since she traveled with the injury, I suppose. This happened 2 years ago.
If Medicare Advantage was not marketed as Medicare and made it clear it was a private insurer provided HMO/PPO product to the over 65 set, I wouldn’t rail about it. It does work for a subset of people. But it’s depleting real Medicare and I think it’s rife with false and misleading advertising.
Neophema
@Butch:
I grappled with the same questions when I became eligible for Medicare. Here’s what I learned and here’s what I did.
I started out with an MA plan but switched back to regular Medicare with a Plan G supplement. What I don’t like about MA is that switching back to regular Medicare after a year is medically underwritten, so if you become seriously ill you’re screwed. Plus, with MA you can only see their doctors and everything you do is subject to their approval. Plus, in most cases you still have deductibles and copayments. My conclusion was that MA is OK so long as you’re healthy. When you become Medicare eligible you are probably reasonably healthy and employable, even if on a part-time basis. What happens when you’re in your 90s, unable to work, and sick?
With my Part G supplement, I pay a monthly premium and a small annual deductible and after that everything is covered subject to Medicare guidelines. An MA plan would probably be cheaper today, but after a lifetime of lousy self-employed-person insurance, I’m happy to pay for the peace of mind.
Go to a reputable broker to get the best rates. Supplement plan benefits are regulated by Medicare, so as far as I can see there’s no benefit in going with a particular provider. Just go with the cheapest established company.
Ditto for Part D prescription coverage. A broker can find the cheapest policy for the drugs you take on a regular basis. You’ll get some coverage for other drugs but they will often be subject to a high annual deductible. When I get a new prescription, I always compare prices with one of the over-the-counter discount plans like SingleCare. Avoiding the deductible is frequently cheaper.
If any of this info is wrong, I’d welcome corrections. Personally, I‘d like to see all of this swept away by single payor universal coverage. Having to wade through a swamp of deceptive advertising to place a wager on your future health seems idiotic and unnecessarily cruel. And, despite your best research, a “fiscally conservative” government could blow it all up at will. The whole system sucks.
Ohio Mom
@Neophema: That is the perfect ending for this thread: The whole system sucks.
scribbler
@Neophema:
“An MA plan would probably be cheaper today, but after a lifetime of lousy self-employed-person insurance, I’m happy to pay for the peace of mind.”
Hard agree. I’m in the same boat. It’s so nice to KNOW I’m covered with no nasty surprises.
Barbara
@Neophema: It’s not wrong. I will say that my mother never had issues with her MA plan, even in her early 80s after she developed health problems. The way I think about it is, if you find a good MA plan, it probably is better than regular Medicare, which is very fragmented, but there is a lot more variability among MA plans.
Also, and I can’t stress this enough, Med Supp plan underwriting practices vary a lot, by location and carrier. Do not assume you can’t get one or it will be too expensive if that’s what you really want. I know people who went from MA back to original Medicare and even with health problems were able to get affordable supplemental coverage.
Butch
@Neophema: I don’t have a supplement plan because of the cost; I’ve just had Medicare Advantage since I enrolled. I’m afraid I’m going to coast right back to the Humana plan out of a combination of confusion and inertia, so I think my next move will be talking to a broker. She helped with spouses’ ACA policy so I’m hoping it’s the best path.
JeanneT
I signed my mom-in-law up for Medicare Advantage because she did not have enough income to cover supplement and part D plans. It worked out very well for her, even as her medical and prescription needs went way up as she hit her 90’s. I’m curious about the bad stories about MA. Myself, I have regular Medicare backed up with CHAMPVA coverage. So far so good……
Yarrow
@NoraLenderbee:
Your questions are part of why it’s such a pain to go on the exchange to look for coverage. A lot of ACA customers have to be self-employed and income varies. It’s hard to prove.
Since you’re laid off you should be asked if you’re eligible for COBRA. You don’t have to take COBRA but they’ll ask.
Since you’ve been laid off and aren’t sure of your income going forward, you can just give it your best guess as to what your income will be and justify it in writing. Maybe you have some investment income, rental income, or consulting income you’re expecting. You do your best to guess and put it in the boxes. In the end it doesn’t really matter because it all works out when you do your tax return. Last year’s tax return is one way to justify your income, but since yours will be significantly different this year (not unusual!) you probably don’t want to do that. You do have to have income above the poverty level threshold, so you need something to justify having that much. Otherwise you’ll be sent to Medicaid or nothing (in non-expanded Medicaid states). Edit: I should add you might have to provide actual bank/investment statements to show interest income or a rental pay stub or something. They may or may not ask for that sort of thing.
They don’t really do a backwards look at your income except for last year’s tax return. Again, because that was more money and way different from what you will have now, you don’t really want to use it. You can even write on a piece of paper that you were laid off and your income is uncertain, but you have X, Y and Z as income, or you’re expecting a certain amount as consulting. If they need more info they’ll let you know.
Once you have coverage and you know more about your income, you can go back in at any time and update your income. Warning: when you do that, you’re basically starting the application process over again. It’s a freaking pain. The plans available to you are different at various income levels so if you get a consulting gig or something you may only then qualify for a more expensive plan. If you don’t update your income, and it’s substantially higher from what you said it would be, you’ll have a penalty to pay in terms of what assistance you were getting and what you should have been getting. They’ll claw some money back or you’ll get a refund, depending if your income went up or down.
Betsy
@Neophema: the unnecessary cruelty is a feature, not a bug, in America. We* love suffering, and hate to see Americans just get what they need, easily and kindly.
*That’s “We”. I mean “they”, not us here on the blog.
NoraLenderbee
@Yarrow:
Thank you! Good to know you can adjust the amount. I’m on CoBRA (subsidized) through December, but in January it goes up to the full price so I will be applying for ACA.
Juju
@NoraLenderbee: Try going through healthcare.gov and see what happens.
Eunicecycle
@Barbara: I am on a MA plan and had to go to the ER out of network. When I called the plan they said I would only owe the $110 copay because it was an emergency. The bills haven’t been all paid yet so I guess I will see!
Yarrow
@NoraLenderbee: I completely understand. It’s okay not to continue COBRA. People do that.
Be prepared about justifying your income so you have stuff to “prove” it. A friend of mine had nothing to show and was working with an insurance agent who understood the exchange. The agent told my friend just to put down “investments” and I don’t think they ever asked for verification or justification for it.
I personally find it incredibly stressful and nerve-wracking to sign up for it even though I’ve done it for quite a few years now. Our system sucks, as much as I’m super grateful for the ACA and the exchange.
Yarrow
@Eunicecycle: Most plans seem to cover actual ER visits, so long as it’s considered an emergency. If you’d gone to Urgent Care instead you might have had a different experience with coverage out of state. It sucks.
Shana
Hubby and I will join Medicare next year, me in January he in February. He retired last year and we’ve been using Cobra since May of 2022 which expires at the end of this month. We’ll be paying directly to his former employer for the gap months. His firm offers consultants who have been good about counseling us on what we want/need out of Medicare. They have suggested Medicare parts A and B with recommendations for Parts D and G. It’s bewildering at first but starts to make sense when you dig into it. It helps a bit to be married to an employee benefits attorney.
On a related note I have received a boatload of stuff in the mail for the last several months. Amazing how they find you.
David Anderson
@NoraLenderbee: ACA subsidies are estimated and advanced to you on the basis of a good faith estimate of next year’s income. When you file your 2024 taxes in 2025, if there is a substantial error, the IRS will claw some/most of the money back if the Feds overpaid subsidies and you underpaid your premiums.
Good faith is a flexible term. If you have good reason to suspect that your 2024 income is going to be substantially less than your most recent tax return’s income, the exchange might request documentation of a reason (ie unemployment etc) but it is a flexible term right now.
NoraLenderbee
@David Anderson: @Yarrow:
Thank you, that’s exactly what I wanted to know.
@Juju: I did, and I was redirected to the California exchange, coveredcalifornia.whatever.
EthylEster
@Butch: I too have Medicare Advantage. I also have an excellent navigator who always responds to my emails, when I have questions about things, like whether to stay in the MA plan. Writing Cynthia is much easier that endless searching on the web, which is full of lies and BS about Medicare. Here is a link that might be useful:
https://www.kff.org/medicare/issue-brief/medigap-enrollment-and-consumer-protections-vary-across-states/
My understanding is that as long as you are pretty healthy, the MA can make sense and save you money. But when your health starts to decline, it is time to do your one-time movement from MA to regular old Medicare. THEY have to take you back but the supplemental coverage insurers can reject you if you are “too sick”. Then you are probably stuck paying the 20% that Medicare doesn’t cover….depending on the state you live in. I think this is where underwriting comes in.
But really the best idea is to find a GOOD health insurance navigator.
Juju
@NoraLenderbee: I live in NC. we don’t have an exchange. I didn’t realize you have to use your state exchange.
Yarrow
@NoraLenderbee: Some states have created their own exchanges. California is one, so you go to coveredcalifornia. Other states didn’t do that so you go to healthcare.gov. In the beginning each state was supposed to create their own website but that didn’t happen and for many states still hasn’t.
I kind of wish they’d just have everyone go to healthcare.gov so it’s easier to help friends in other states. It seems kind of dumb to reinvent the wheel for each state.
BretH
@Shana: In COBRA now, expires at the end of the year, will go in Medicare next April. Grateful for everything I’m reading here! Will find a broker for sure.
Shana
@BretH: Hubby’s is through his (former) employer.
Also, counselor told us that MA plans are paid a lump sum per participant and therefore their incentive is to use as little as possible to maximize profits. FWIW
Barbara
@Shana: Sort of, yes, but they are also subject to medical expense ratio rules such that they have to repay a certain amount if they fall below the required threshold for using revenue to pay for benefits.
La Nonna
Thank the gods for Italy’s universal healthcare, we opted out entirely from Medicare and use the Italian public system (basically free to legal residents and citizens, sliding fees for specialist visits), with the occasional private treatment, i.e. dental not covered except oral surgery. It just works so very well.
Kayla Rudbek
So how do I compare my company plans among themselves, particularly for the tamoxifen?
PST
I would like any advice David or my peers have about selecting a Part D plan based on what I might need in the next year. Right now, my premium is $0 (!) and the cost for my two very common generic old-man prescriptions is $0 per quarter. I have just received a new prescription that won’t break the bank under any circumstances, but that will be cheaper with GoodRx or at Amazon Pharmacy than under any plan available to me. So I have no short-term reason to change, but how do I protect myself against being diagnosed in February with multiple myeloma or something? I can’t go through 20 formularies speculating about what I might come down with and what drugs it might require. I need a way to select a Part D plan that actually insures me against adverse contingencies, not one that minimizes my current, insignificant pharmaceutical bill.
Barbara
@PST: Yep. It’s the best question to ask. The short answer is, you can’t really. In theory all Part D formularies have to cover at least two drugs in every category (if there are two), but that doesn’t mean it will be the exact drug your physician wants to provide you with, or that the costs will be equivalent. However, you can also be sure that most physicians are fully aware of differences in coverage and will try to prescribe an on-formulary product for you. In addition, you can appeal (and contrary to lore, appeals can be successful) and then, you can switch at open enrollment.
JaySinWA
The medicare.gov website
https://www.medicare.gov/drug-coverage-part-d/how-to-get-prescription-drug-coverage/6-tips-for-choosing-medicare-drug-coverage
has this advice