The average Medicare enrollee can now select from among a plethora of Medicare Advantage and Medicare Supplement plans and solutions. As of last year, there were more than 24 million Americans enrolled in Medicare Advantage plans, accounting for about 36% of all Medicare beneficiaries.
Along with this growth in acceptance has come a growth in the number of Medicare Advantage options; the average enrollee can select from among 33 different plans in 2021.
Additionally, people who have the original Medicare (Part A and Part B), can add Medicare Supplement to help defray the costs. However, each plan is mutually exclusive from the other.
When lifestyles also dictate the kind of coverage one needs, seniors seek consultative help in making their best choice among the proliferation of alternatives, says Dave Rich, CEO of Clearwater, Fla.-based insurance technology and product distribution firm Ensurem.
“Increasingly, seniors are seeking expert guidance to help them custom-fit Medicare solutions to their own particular needs and lifestyles,” Rich says.
Today’s seniors tend to seek information digitally whenever possible, reflecting the heavy presence of digitally active Baby Boomers among Medicare recipients. During the 1980s and 1990s, when computerization took over the American workplace, these people were in their thirties and forties, helping set the stage for today’s world. Digitally savvy as they may be, however, says Rich, when it comes to making Medicare coverage decisions, seniors increasingly find themselves faced with more detailed information than they can easily sift through and make decisions about.
For example, Rich notes that insurance companies offer six different approaches to Medicare Advantage plans: as an HMO (health maintenance organization), a PPO (preferred provider organization), an HMOPOS (HMO Point of Service), a PFFS (private fee-for-service), a MSA (Medicare Savings Account) or an SNP (special needs plan).
Throughout the selection process, there are tradeoffs to be made. For someone who wants prescription drug coverage and is choosing an HMO or PPO, it’s important to select one that includes prescription drug coverage, because if you have an HMO or PPO Advantage plan, you can’t buy standalone Medicare Part D drug coverage.
To further complement the issue, seniors have to also contend with Medicare Supplement Plans—also known as Medigap plans. Medicare Supplement plans carry the letters from A to N to designate a specific coverage level meant to help pay for gaps in Original Medicare. These include plans that pay for some or all of your deductibles, copays and coinsurance.
According to the Centers for Medicare and Medicaid Services (CMS), Plan F and Plan G are the most popular. However, as of January 1, 2020, Plan F is no longer available to new Medicare enrollees. Plan G covers all the same gaps as Plan F with the exception of the Medicare Part B deductible.
One important factor for seniors to consider is enrollment limitations. Medicare beneficiaries are subjected to certain enrollment periods during which they can join or switch plans. In most cases, Medicare beneficiaries can enroll into any plan during their initial enrollment period (IEP) when turning 65. However, if they miss their IEP or they are unhappy with their coverage and want to make changes, they could be forced to wait until the Annual Enrollment Period from October 15 through December 7.
Medicare Supplement plans on the other hand, are available year-round; however, beneficiaries may be subjected to medical underwriting when enrolling outside of their IEP.
Looked at from one angle, says Rich, health coverage for seniors lies amidst the best of all possible worlds: widely available government-supported healthcare, augmented by a wealth of carefully targeted private options.
From another angle, it looks like a confusing federal bureaucracy made more confusing by the competing offers and requirements of a host of for-profit businesses. “It’s both, and that’s a good thing: the range of Medicare plans makes it possible to tailor healthcare coverage to a given senior’s budget and needs far more effectively than any one-size-fits-all solution could do,” Rich says.
However, it’s still a lot to deal with. The complexity of the Medicare Advantage and Supplement landscape, and the need for seniors to make the most of it, is changing the role of the insurance broker, Rich adds. Customers still have a lot of questions, but more and more Rich says the relationship has moved from question-and-answer to a dialogue, in which seniors seeking exactly the right coverage for their particular needs interact both with Ensurem’s staff of in-house brokers and its AI-driven digital resource, Agent E.
“We’ve become Medicare consultants,” says Rich. “We don’t charge for consultation, but it’s an increasingly important part of what we offer. We think it’s what the industry needs, and we know, from the conversations we’re having with our insurance customers, that it’s what the seniors need. It’s become an integral component of our business.”