Medicare Advantage gaining popularity with lower costs, more benefits

Rates are falling for Medicare Advantage plans, while a new raft of extra health benefits are expected to make the plans more popular than ever, the nation’s top Medicare official told seniors in Indianapolis on Monday.

Seema Verma, administrator for the U.S. Centers for Medicare and Medicaid Services in Washington, D.C., visited Nora Commons on the Monon, a senior apartment complex near East 91st Street and North College Avenue, to speak to Medicare beneficiaries.

The trip was meant to drum up excitement for Medicare Advantage plans, a hugely popular alternative to traditional Medicare. The plans now cover about one-third of all Medicare beneficiaries, or about 20 million seniors.

Open enrollment runs through Dec. 7. In Indiana, dozens of insurers are offering various Medicare Advantage Plans.

Nationally, more than 2,700 different Medicare Advantage plans are available, according to a study by Kaiser Family Foundation. Many are competing fiercely for customers, forcing seniors to study the plans closely and see which benefits match their needs.

“We actually have new plan choices, plus we have lower premiums this year,” Verma told IBJ in a phone interview.

Nationally, the premiums for 2019 are down 6 percent compared to this year, she said.

Some of the new features include nutritional services, transportation services for medical visits, and funds to help build ramps and handholds inside a person’s home. Those extra services represent the biggest expansion of Medicare benefits since Congress approved the Part D drug program 15 years ago.

“The idea is really looking at the comprehensive needs for each individual and figuring out what benefits will keep them healthy,” she said.

Those extra benefits are available only through Medicare Advantage plans, not through traditional Medicare.

However, Medicare Advantage has come under fire for improperly denying many medical claims to patients and physicians. In a recent report, the inspector general at the Department of Health and Human Services, said some of the private plans have an incentive to deny claims in an an attempt to increase their profits."

“Because Medicare Advantage covers so many beneficiaries, even low rates of inappropriately denied services or payment can create significant problems for many Medicare beneficiaries and their providers,” said the report by the inspector general, Daniel R. Levinson.

Under Medicare Advantage, the government pays private insurers a fixed per-member per-month fee. The insurer acts as a managed care organization and is responsible for the health care of its members. If it provides that care for less, it makes a profit. It the cost of care is higher than the fee, it loses money.

Verma, a Carmel resident, was chosen by President Trump last year to oversee CMS, which employs more than 6,000 and has a $1 trillion annual budget.

In Indiana, she helped former Gov. Mitch Daniels develop the Healthy Indiana Plan, a conservative alternative to traditional Medicaid. Later, she would help Gov. Mike Pence expand the Healthy Indiana Plan and get approval from the Obama administration to use it as a vehicle for Medicaid expansion, and then scale it up from about 30,000 beneficiaries to more than 400,000.

Now, with Medicare Advantage swelling in popularity, some experts are predicting even more growth.

“A lot of folks out there have predicted that some point in the near future, we may have more than half of our Medicare beneficiaries participating in Medicare Advantage,” Verma said. “And I think that’s because some of these lower costs.”