The privatizing of Medicare means nearly 1 in 5 of those with traditional Medicare have no source of supplemental coverage.

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?”

“Yes.”

“And the co-pay?”

“Yes.”

I’m confused.

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.

2 thoughts on “The privatizing of Medicare means nearly 1 in 5 of those with traditional Medicare have no source of supplemental coverage.

  1. How these private Medicare Advantage plans came to be called ‘Advantage’ plans is still a puzzle to me.
    Where is the ‘Advantage’? When I retired a few years ago I decided to forego this “advantage” and sign up for a supplemental plan. No copay, no coinsurance, no cap….just a one-time annual deductible and a comparatively low monthly premium.

  2. The Medicare Advantage Plans are simply a more-complicated private insurance, with all the usual fol-de-rol of duplicative fees, such as “deductibles” then “caps” or “yearly out-of-pocket limits”, while the Feds try saving money by forcing consumers to spend it getting the extra coverage Medicare doesn’t offer. Our Nation can do far better without “socializing medicine”, “death panels”, “care rationing” or other tired nonsense. *Yes, I know some people don’t pay a penny for their MAP coverage, but others do.

    Taking Medicare for All as the starting point, and somewhat briefly, try: 1) eliminating the Medicaid program, and move those administrative and treatment dollars into the Medicare pot, eliminating the duplicative workforce (public and private) administering State-run but Fed/State funded programs. 2) having one nationwide healthcare insurance system for everybody, paying providers at higher rate than the State (Medicaid) programs did, and, 3) doing away with the shell game of deductibles, caps, etc for medical and prescription coverage, and having one Medicare deductible per year, and your monthly Medicare payment. Adjustments for income/poverty level issues can still be done as done with Medicaid now, but likely much faster since more and more records needed to verify/compute have been computerized for Medical and Unemployment Insurance applications already.

    I can hear the insurance industry lobby yelling already, but frankly, too bad. You’ll find some way to survive, maybe by taking your names off the sports stadiums, etc., reducing C-level executive pay to something akin to the rest of the Free World as compared to the employees actually doing the work and earning the money, and focusing on providing other insurance and investment services. The layoffs would not be as bad as some will project; many people can be moved to existing jobs, some will retire, etc. And the improvement to American healthcare would be tremendous long-term. As someone who has run the gauntlet of Medicaid, Medicare, and private insurers, it is well past time to improve our health care for everybody.

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