MA plans under attack

[midwestbroker]

Humana has been in the Kansas City Market with HMO's since 1991. We also had Keiser, Health Net, and Coventry here with their HMO's for a while. Some time ago (I think in the late 90's) when Medicare changed the pay to insurance companies, most of them left and Humana locked it's enrollment.

Once that was cleared up, Humana opened enrollment again and the PPO came about. Coventry came back. And since Part D came out, we now also have Sterling and Pyramid as well. I think the PPO is about 4-5 years old now.

It used to be called Medicare + Choice (standardized in 1997) and then became Part C in 2005 with the into of Part D.

So, MA have been here quite a while. However, the premiums were higher. 5 years ago the HMO was $50+ per month with no drug coverage. Now they are $19 with drug coverage.

 

[midwestbroker]

P.S. Humana did not use brokers for the sale of these products, only captive agents. Plus, their quotas were low, since their popularity was not what it is today.

 

[Cenla Agent]

Mike I'm confused, I thought that Medicare Advantage plans were rolled out sometime in 2005. I first really heard of them or got information in 2006 when I certified with PacifiCare.

I worked the St. Louis market from 1995 to 2004, that is where I lived. The only thing I was aware of during that time was HMO's.

I know you have a lot of expertise in Medicare Advantage plans so I am really curious as to why they were in KC and in St. Louis I didn't know they existed.

Maybe I was just concentrating so heavily on Med Supps that it flew right by me.

Who was offering Medicare Advantage plans in 1991 in KC?

I think Medicare Advantage may have been around in one form or another since probably the late 1980's, but I don't think they were called Medicare Advantage until 1997. They were called Medicare + Choice at one time. (I don't know for sure, having just gotten into the senior market in the past few years). The plans used to be much more concentrated in FL, AZ and major metros since most if not all were HMO's in the beginning.

BTW an HMO (meaning Medicare HMO) is a type of Medicare Advantage plan. Some people seem to use the term Medicare Advantage to refer to PFFS only, but HMO's and PPO's are types of MA plans too.

 

[Frank Stastny]

BTW an HMO (meaning Medicare HMO) is a type of Medicare Advantage plan. Some people seem to use the term Medicare Advantage to refer to PFFS only, but HMO's and PPO's are types of MA plans too.

Thanks Mike and Cenla,

I'm familiar with the history of HMO's, Humana, Part C, Medicare + Choice and the rest. I had just never heard of them as a group commonly referred to as "Medicare Advantage Plans" until the PFFS were released. So not to be misunderstood when discussing the various plans, other agents and I called an HMO and HMO and the same with all the others since there is a difference.

When I talked to agents/brokers about "Advantage Plans" they automatically assumed that you knew they were talking about PFFS plans. That is also pretty liberally done here as well. Usually when someone mentions "Advantage Plans" aren't they referring to PFFS plans like Pyramid as opposed to HMO's and the rest?

Until the PFFS were released, I know many agents who referred to Med Supps as Private Fee for Service plans to distinguish them from an HMO, etc.

I really appreciate you guys clearing that up for me. I thought I had missed out on something.

I think most large metro areas have had HMO's and the like for a long time. So, it isn't surprising that doctors in those areas more readily accept PFFS plans they their country counterparts.

 

[midwestbroker]

The thing about major metros is that carriers push HMO / PPO plans since the profit margin is better. The Humana PFFS plan here in KC is twice the premium of the PPO. There are still the stand alone PFFS plans, but they have not been too successful compared to the others.