No End for MA Plans

[midwestbroker]

There are many agents out there that say Medicare Advantage is coming to an end.

So, here is my reply:

First, let's look at the history of them.

Started in the mid 80's as HMO's.

Were standardized with Medicare supplements in the Balance Budget Act of 1997.

Were expanded in the Medicare Modernization Act of 2003 along with the creation of Part D and PFFS.

The MA program is over 20 years old. Maybe new in some areas, but I can attest to Kansas City where they have been since about 1991. Six years before standardization.

Will the market change? Yes. Will MA go away? Maybe in some rural areas, but the metros where they have been for 10-15 years, they will still keep going. Sure, maybe some $0 premium or low premium plans will raise in cost, and all that is doing is hurting the very people you are trying to "protect".

Maybe MA is a dying model in some parts of the country, but with 20+% of seniors enrolled in some type of MA plan, these plan are not going away.

If you want to see MA programs working, come ride with me for a day. I would say at least 60-75% of my sales are from people who talked to their friends who have a MA plan and are very happy with them.

 

[theinuranceguy]

Most agents are cry babies.

They complain about this and are upset about that, and then wonder why by the end of AEP they cant rub to pennies together.

We have the same philosophy. Things will change, but we gotta role with the punches...

MA's aren't going anywhere. In the 90's we were getting paid $50 to sell ZERO premium plans and we were ecstatic. Now we are at $500+ and complain because its hard to get in the door.

Do the right thing for the client, and you'll be fine.

 

[Mac1958]

One source of confusion may be the difference between PFFS and PPO/HMO Medicare Advantage plans. My guess is that people tend to lump all the plans together, and that might be a mistake.

PFFS is definitely toast, at least in most areas. It's more costly to operate than PPO/HMO, and the Congress has already passed legislation (the Baucus Bill in July) that will effectively end these plans in all but the most rural areas as of 2011. They've been after PFFS for a couple of years, saying it costs the government 10% to 17% (depending on who you read) more.

Here's a quick article:

Medicare Advantage plans on the ropes - Congress cuts funding for private plans to offset outlays for physicians and other Medicare programs - Managed Healthcare Executive

Since PPO/HMO is less costly to operate, I'd suspect that they'll be able to survive significant cuts in Medicare spending. The big MA players are definitely preparing for 2011 and beyond.

Will MA's go away? Doubtful. But are there any guarantees in life? Nope.

...

 

[patch36]

There will always be nattering nabobs of negativity. MA plans, especially the HMO/PPO and the PFFS where there are no networks available, are here to stay. Too many folks have them and are dependent on them. AARP jumped on the MA bandwagon in a big way last year and the insurance companies are highly invested in them. The insurance companies are also highly invested in your congressman.

 

[dandan]

Role or Roll?

 

[MedSuppPro]

One source of confusion may be the difference between PFFS and PPO/HMO Medicare Advantage plans. My guess is that people tend to lump all the plans together, and that might be a mistake.

Agree... And why throw out a managed care model with the bath water? That's not going to happen. Even PFFS plans have prior authorization and soon networks.

Got a related question:

What is your opinion of the future of Cost Plans. If 2010 Cost Plans end, then what happens? SEP!!!