The other day I received a doctors bill for a minor procedure for 90 bucks.
As I aways do, I called United Healthcare, which is the private insurance that handles my state retired teacher Medicare Advantage program.
“That goes to your deductible,” the pleasant voice on the other end of the line told me.
“And that applies to my $1,100 cap?,” I asked.
“No. After your deductible is paid you are required to begin paying a co-pay,” the pleasant voice said.
“But the cap?” I said again.
“Yes. With the Medicare Advantage program through the state retired insurance program your out of pocket costs are capped at $1,000.”
“Is the deductible included in the cap?”
“And the co-pay?”
Could I be the only one confused?
But for those without supplemental coverage there is more than mere confusion in what is becoming a highly privatized market-based profit driven system.
In 2018 study by the Kaiser Permanent Foundation, 5.6 million Medicare beneficiaries in traditional Medicare– 1 in 10 beneficiaries overall (10%) or nearly 1 in 5 of those with traditional Medicare (17%) had no source of supplemental coverage.
Beneficiaries in traditional Medicare with no supplemental coverage are fully exposed to Medicare’s cost-sharing requirements.
Medicare has no cost caps. It pays for 80% of whatever treatment is included in its coverage. That’s not what the doctor actually charges, but the cost that they determine.
Medicare offers no protection from of an annual limit on out-of-pocket spending because traditional Medicare does not have an out-of-pocket limit on cost sharing for services covered under Parts A and B.
In contrast, since 2011, federal regulation has required Medicare Advantage plans to provide an out-of-pocket limit for services covered under Parts A and B.
But Medicare Advantage plans, which dominate the supplemental coverage industry are all private insurance programs.
There are over 50 Medicare Advantage plans and retirees are forced to shop and compare cost and coverage, a virtually impossible task.
Compared to all traditional Medicare beneficiaries in 2018, a larger share of beneficiaries with no supplemental coverage had annual incomes between $20,000 and $40,000, were under the age of 65 (and eligible for Medicare due to having a long-term disability), and were men.