Medicare "Advantage" Plans

(A brief introduction for those not familiar with how Medicare is administered. There are two ways to receive Medicare benefits when you are eligible; one is through the government administered traditional Medicare and the second option is to get your benefits through a private insurer. The benefits under the traditional system are pretty standard across the country, while private plans have different costs and benefits by region and plan.)

This is exactly why private insurers should not be involved in Medicare. If you need more convincing, read this. A few things to note:

-People who have Medicare tend to be the least likely (able) to research and understand what the differences between 50 drug plans are. We're talking about people who tend to be less mentally acute (whether because of age or a disability) and who may never have used a computer before (something our generation takes for granted). Much of the information about the plans is online.

-Both CMS (the federal adminstrator of Medicare) and private insurers have been called out on inappropriate actions. The insurers are not following through on marketing promises and CMS fails to regulate them.

-Keep in mind that the increase in premiums is typically not met with an increase in income. Most Medicare beneficiaries lived on a fixed income.

So, to sum up. If you're able to know what questions to ask of whom, you're likely to get incorrect information and pay an increasingly high percentage of your limited income on a plan that doesn't give you coverage.

Additionally, if you think that private plans are saving the government money, think again. The government pays the insurers to provide Medicare plans, more than what it pays for a beneficiary under the federal program.

Medicare’s payments for beneficiaries enrolled in Medicare Advantage plans are higher, on average, than what the program would spend if those beneficiaries were in the FFS [fee for service] sector—so shifts in enrollment out of the FFS program and into private plans increase net Medicare spending.