I watched my Dad wade through the Medicare + Choice booklets he received several times over the years trying to determine which plan he should choose. My dad was no slouch, but he had a terrible time weighing alternatives: premiums, coverage, out-of-pocket. He spent a lot of hours sighing over those booklets and many days wading through them.
Now consider your average Medicare recipient with no experience of insurance plans except perhaps an employer plan in the past, and no training or even a knowledge base from which to evaluate varying plans. As someone who handled insurance for eight years for a company I worked for, I can tell you that even highly educated people have trouble figuring out what’s in their policy. So we ask seniors, who’ve never had to make these decisions before, to make a decision.
Which brings me to my experience in the surgeon’s office. The most often heard question from seniors was: “Doesn’t Medicare pay for that?”
And the most common response was evidenced in the saddest moment I witnessed there. An elderly couple, who didn’t look at all well-heeled, one of whom obviously needed some kind of eye surgery, asked that question. The answer was, “You are not on Medicare. You are on Humana Medicare and you have a $7500 deductible. You’ll have to pay for the surgery.”
They paid the bill for the day’s exams ($300) and then walked out without making a surgery appointment. After watching what my dad wrestled with, I’m pretty sure what happened. They couldn’t fully understand the packet, they opted for a plan they could afford without fully understanding its limitations – most likely seduced by a name they trusted: Humana – and one of them is now going to go blind.
According to the fact sheet provided by the Kaiser Foundation:
M+C was established by the Balanced Budget Act of 1997 to give beneficiaries the option of enrolling in a variety of private plans including health maintenance organizations (HMOs), preferred provider organizations (PPOs), provider-sponsored organizations (PSOs), private fee-for-service (PFFS) plans, and medical savings accounts (MSAs) coupled with high deductible insurance plans.
Once again, having too many choices has failed. At least for Medicare beneficiaries. Enrollment in these plans started dropping precipitously after a few years as beneficiaries began to realize what they had gotten into. What’s more, insurers who got into this plan started trying to find a way out. So of course Congress responded to insurer’s concerns:
A number of changes have been adopted since 1997 to encourage plans to stay in the Medicare market. Both the Balanced Budget Refinement Act of 1999 (BBRA) and the Benefits Improvement and Protection Act of 2000 (BIPA) increased payments to M+C plans. In addition, Congress eased administrative requirements, such as the deadline for plans to submit information on benefits and premiums.
But something else was also going on:
A number of studies have found that managed care has resulted in increased Medicare spending, rather than savings, because enrollees are reportedly in better health and have lower than average medical costs than those in the traditional program.
So it’s costing us more to provide Choice, and the results of Choice are:
A recent study found seniors in poor health or with low incomes had poorer outcomes in managed care than in FFS (Safran, 2002). While the majority of M+C enrollees report being satisfied with their care, those with health problems and the under-65 disabled are more likely to report difficulties accessing specialists and other covered services (Cox, et al., 2001; HHS OIG, 1998; PPRC, 1997).
I listened to dozens of stories like the one above on Tuesday, and it made me steaming mad. It also explains why seniors are going back to traditional Medicare as soon as they get a chance. They run up against a health issue like this and discover they might as well not have any insurance.
But what if it’s something that can’t wait? What if it’s a crisis? Our seniors find out only when it’s too late what “choice” really means.
This is for me a prime example of what happens when our government makes a seemingly benign change to a program with an eye to balancing the budget (or making money for big business). In the end the country is paying more for Medicare, and a lot of seniors are paying more or doing without.
This is criminal. Period. No excuses for the idiots in Washington on this one. While the Choice program was supposed to have equal benefits at the same premium, clearly it does not, at least not now. The government pays more to insurers, and the insured get screwed on deductibles and services that are not covered.
Way to go.