Medicare supplements or Medicare Advantage?

As we head into AEP (Annual Enrollment Period), which is October 15th – December 7th each year, the question I get most often is, “Medicare supplement or Medicare Advantage?” They really are two completely different animals that come to healthcare from two different focus points. Medicare supplements are focused on paying for “medically necessary treatments,” whereas Medicare Advantage is much more into “Preventative Care.”

There are pros and cons that come with each program. Medicare supplements are good anywhere within the country that will bill Medicare, Medicare advantage plans are mostly network-oriented plans with the most popular plans being HMOs or PPOs. Medicare supplements do come at a price in the form of premiums, these vary by state, and even by zip codes within states. Many of the popular Medicare advantage plans come with no or low premiums, with a few even providing for a partial “giveback” of the Part B premium. Medicare supplements generally do not offer non-medical additional benefits, although a few are now offering Silver Sneakers-type gym memberships as a bonus. The additional benefits are where Medicare advantage plans seem to really shine. Benefits such as the Part B givebacks, dental and vision, and one-way trips to the doctor’s office are all very popular in some areas.

For me, my biggest concern with Medicare advantage is that you have taken many medical decisions out of the doctor’s purview and given them to a detached underwriter that is looking at medical charts from afar. How many times have you heard from a doctor in the hospital say things like, “We’ll run that test once we make sure her/his insurance will approve the test,” “We could only get her/his additional recovery days at two instead of the three we recommend through their insurance company,” or “The insurance company would not approve the rehab in the nursing home we recommended so she/he will be released to go directly home for rehab.” I have personally heard every one of these comments and more directed at my clients and took calls asking me if there was anything they could do. You do have a right to appeal, but they are rarely successful.

Medicare supplement covers all medically necessary Part A and Part B expenses, the doctors and/or the CMS decide what is medically necessary. Medicare advantage plans decide for themselves what is covered and to what degree, of course their decisions determine their bottom line in profitability, something about that just seems wrong to me. This AEP asks your agent questions, know the pros and cons and if the added additional benefits outweigh the loss of control of the medical decisions.

Robin Lee