Medical Necessity

It is possible to imagine a medical condition that could go on for years with some kind of expensive treatment that could use up much of the maximum out of pocket on a Medicare Advantage. I wonder what the percentage is of those who pay thousands of dollars for Medicare supplements over the years, then die in their sleep, vs those who have Medicare Advantage and spend more than the average a supplement would have cost them over the years. One big problem, most who buy MA's don't or can't set aside enough money to have a decent emergency fund.
Guess you have never heard of cancer?... Very easy to hit the max in more than one year.. Especially if your diagnosis comes toward the end of one year.. There are many chronic diseases that last for years and years. ..I probably have 20 or more specialist visits plus MRIs, CTs, and other tests that are rather expensive every year....Now, add that to the fact that if I happen to choose the wrong MA, many of my practitioners will no longer treat me because back when I checked, I could not find a single one that covered every provider I use.. . I not worried about the money I won't have in my pocket when I die in my sleep, I am worried about the money I won't have when I need treatment.
 
Folks on Medicare rarely have $0 claims or multi-thousand dollar claims. Usually somewhere in between.

Agents who talk about maxing out the Advantage plan every year are missing the point. If your client is running up a couple of thousand dollars every year that is near the break even point where MA and Medigap are pretty much equal.

As long as you don't care about ACCESS to health care.

I have several clients with chronic issues that are easily generating $2,000 - $3,000 per year in claims. They are not terminal but their care is expensive.

If we had a crystal ball and could predict who will get sick or injured and when it will happen our work would be easy.

But we can no more predict the future about health any more than we can say who will need to have good car insurance because of something that WILL happen soon.

According to this site, the average 65+ person has about $10,000 in savings.
What Is the Average Savings Account Balance? - SmartAsset

And the average debt load is $66,000
This Is How Much Debt the Average American Has Now—at Every Age

I submit that most folks 65+ do not save "the difference" any more than the BTID clients socked away enough cash to the point they no longer needed life insurance
 
if I happen to choose the wrong MA, many of my practitioners will no longer treat me because back when I checked, I could not find a single one that covered every provider I use..

My very first Medigap client was a guy who switched from OM to MA then went to his pulmonologist in January. Doc told him he would see him that day, no charge, but don't come back until you have OM.

I wrote him on a Trial Right. Made $25.

Ed lived for another 18 months or so before the emphysema took him down. In that time he sent several prospects my way that became clients.

A few years later his wife turned 65 and has continued sending referrals including one last month.

I have said this many times. The MA vs Medigap debate is not just about $$$. It is also about access to health care.
 
My very first Medigap client was a guy who switched from OM to MA then went to his pulmonologist in January. Doc told him he would see him that day, no charge, but don't come back until you have OM.

I wrote him on a Trial Right. Made $25.

Ed lived for another 18 months or so before the emphysema took him down. In that time he sent several prospects my way that became clients.

A few years later his wife turned 65 and has continued sending referrals including one last month.

I have said this many times. The MA vs Medigap debate is not just about $$$. It is also about access to health care.
I pay $2160 per year for my Med Supp.. If I had an MA, I would probably have round $4K OPM and most years would hit it.. I m going to have to see a pulmonogist now that my COPD has become a problem.. I can go see any I want with no requirement to get a referral from my Primary Care Provider. ..I have no network to be concerns. The med sup premium is difficult to pay until I remember how much freedom it allows me.

My wife had a hip replacement this year.. 4 day hospital stay, Xrays, CTs, etc.. I looked at an MA plan and the co-pays for those items would have run more than her med sup premium and then some. And, as we age, it is not going to get better.
 
You may be convincing me to do an underwritten app for Medsupp for the prospect who wants to drop Plan F (from out of state carrier/plan I can't AOR) and buy an MAPD with shiny ads for dental (cleanings/xrays) and vision ($150 for glasses) + $0 premium. Unless I am missing something the person should be able to continue current premiums, just doesn't like paying. I have helped clients get on MedSupps or do medically underwritten apps to save premium, but never written an MAPD from someone dropping a supplement.
 
You may be convincing me to do an underwritten app for Medsupp for the prospect who wants to drop Plan F (from out of state carrier/plan I can't AOR) and buy an MAPD with shiny ads for dental (cleanings/xrays) and vision ($150 for glasses) + $0 premium. Unless I am missing something the person should be able to continue current premiums, just doesn't like paying. I have helped clients get on MedSupps or do medically underwritten apps to save premium, but never written an MAPD from someone dropping a supplement.
I would drop the F to a G if the difference in premium exceeded the part b deductible.
 
I have several clients with chronic issues that are easily generating $2,000 - $3,000 per year in claims.

The distribution of health treatment costs resembles a power law function. Simply put, a very small percentage of people generate a large share of total treatment charges -- and conversely, a very large percentage of people account for a small share of charges.

Medicare beneficiaries are prone to chronic health conditions. A minority have 3 or more chronic conditions. Most beneficiaries, most years, mostly do not generate thousands of dollars of treatment or Rx charges. Source: National Health Expenditures data, CMS stuff, other sources.

That said, we totally agree on this:

The MA vs Medigap debate is not just about $$$. It is also about access to health care.

My feeling is the divide will get more complex -- and be more exploited -- by insurers, via formularies, plan design, setting of premium rates, etc going forward
 
a very small percentage of people generate a large share of total treatment charges -- and conversely, a very large percentage of people account for a small share of charges.

WHICH clients will fall in category number one and which will be behind door #2?

The question in play is, whose ox is being gored?

Do your stats reveal the answers?
 
The question in play is, whose ox is being gored?

Not sure I follow. If you mean, "can anyone predict the future with certainty?" The answer is no, of course not.

At the same time, it's possible to make reasonable forecasts based on one's family health history, current health status, readiness for behavior change, etc etc.

Plenty of evidence shows we humans are disposed to over-emphasize the possibility of loss, & so overpay to avoid it. That tendency is neither right nor wrong; at the same time it doesn't hurt to be aware of it, and evaluate the economics of things like health coverage options accordingly.

Here are 2 pages from a recent CMS report on health treatment bills for Medicare fee-for-service beneficiaries, sorted by the extent of their chronic conditions.


The dollar amounts are the treatment bills beneficiaries incurred, before benefits were paid. What does it suggest to you?
 
@gregj you seem like a smart guy but you completely miss the point of my questions.

Close but no cigar. Thanks for playing. We have some parting gifts for you. Grab them on your way out.

I'll bet you have them in stitches at the actuaries cocktail parties.
 
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