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aarp support for private insurance

why does aarp support medicare advantage plans when they will eventually make all senior healthcare be meet by for profit and at that point they can charge what they want

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Bronze Conversationalist

@jm9514 I think the answer is AARP receives compensation from United Healthcare (UHC) for the use of their logo, AARP. I am guessing that UHC was the highest bidder among Aetna, Humana, Anthemn, and other various BCBS arrangements. It appears that AARP gets the word out that there is another approach for Medicare which is Medicare Advantage (MA). Based on the number of folks electing MA (almost 50% of Medicare Eligible), I would say AARP's communications have benefited the Medicare Eligible, UHC, the other above noted insurance companies, and Medicare (by transferring risk). A google search reveals that about 80% are satisfied with the MA approach. Because no one insurance company has a monopoly on the MA market, Medicare uses a bidding process and rates are developed using that bidding process.  

 

I am adding a link that describes how Medicare is funded https://www.medicarefaq.com/faqs/how-is-medicare-funded/ Although the article is not from the CMS or SSA, it provides the background that many of us need to know. Lastly, what is wrong with business for profit? In my work experience, business for profit has always been more efficient than government run administrative operations. Although I will acknowledge that the SSA is one of the better efficient low cost operations.  

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Can AARP help advocate for a continued relationship with the YMCA? Sounds like SS is going away at the Y everywhere. How can we make our voice heard?

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Periodic Contributor

Instead of Medicare paying a lot of money to the private insurance plans, tens of them with misleading information during open period, they should use that money to pay better benefits in traditional Medicare. One more observation, the Medicare advantage plans and drug plans with the bigger monthly fees, instead of charging less for doctors, procedures and drugs, charge a lot more money than the plans who have zero monthly payments. Why is that? Why many Medicare plans charge 3 or 4 times more for some drugs that you can get them without any insurance by using just good RX? Is this not a scam?

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Honored Social Butterfly

I can tell by your comments that you don't really understand how Medicare Advantage plans work WITHIN the Medicare program.  They get paid by Medicare for their services - they make a profit because they use managed care.  They get a bonus from Medicare if they have a high star rating.

The government agency of CMS (Center for Medicare and Medicaid Services) under the Dept of HHS regulates and audits all Medicare Advantage plans - CMS makes the rules that MA plans have to play by.  MA plans do look at the whole person because that is where they can make money - managed care.  Yes, they are paid more for the more sicker beneficiaries that are under their plan but CMS is the one that reviews this information and makes the higher payment.

MA plans actually save us a lot of Medicare dollars because they are "managed care" something that traditional Medicare has a very hard time doing.   

MA plans especially some of the newer variety (REACH, Direct Contracting, ACO's) actually contain many other benefits that help the Medicare private insurer treat the whole person and thus save health care dollars.  I'm not just talking about things like dental, vision, hearing - I am talking about things like:

  • transportation to and from medical appointments
  • home modification that can allow for wheelchair access to keep the person in their home 
  • nutritious meals especially if their health condition depends on it like diabetes.
  • various social services 
  • or even a fitness program

None of these are available via the Traditional Medicare program.

 

Also, what would you tell a person that makes too much for Medicare/Medicaid but doesn't have the funds for Medigap monthly premiums?  Without a Medigap plan under Traditional Medicare, the beneficiary has to pay the part that Medicare does not pay.  Remember, Traditional Medicare does NOT have a maximum out of pocket so without a Medigap plan, there is a lot of financial exposure - a Medicare Advantage plan has a maximum out of pocket.  This type of beneficiary likes their Medicare Advantage plan - they get to pick the one they need for their best care every year.  But in most states, you are stuck with the Medigap you pick initially because there is medical underwriting applicable meaning higher premium cost or even non-coverage of a pre-existing condition for a period of time.

 

I think this is an important subject to discuss - but it is important to understand how Medicare works - both the Traditional program and Medicare Advantage plans.  Put the blame on the government agency that is charged with the rules of the program - CMS.

 

CMS actually encourages MA plans because they do save Medicare money via managed care - almost 50% of beneficiaries now use MA plans instead of the Traditional program.

 

 

 

It's Always Something . . . . Roseanna Roseannadanna
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Contributor

Your response omits the conflict of interest AARP has in promoting the privatization of Medicare, since AARP rakes in hundreds of millions of dollars annually from its own MA plans, even though these plans make their profits by denying needed care to AARP members who enroll in them.

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Bronze Conversationalist

@dn7053, Medicare Part C has been available since January 1999. It was known as Medicare Choice. I recall that  HMOs  were used predominantly. The communication regarding Medicare Choice was minimal. In 2003, Medicare Choice was renamed Medicare Advantage (MA). Over the years, marketing efforts for MA have increased substantially with HMO and PPO variations Moreover, there are a number of insurance companies competing for the MA business via a bidding process. This does not look like privatization of Medicare to me. It appears to me to be an approach by the CMS to transfer risk to the private sector which is clever especially when providing health insurance benefits to folks mostly over the age of 65. As we age, morbidity increases for many of us.

 

As you may not know, when you enroll in a MA Plan, you still have Medicare. However, you receive most of your Part A and Part B benefits from the MA Plan not Traditional (original) Medicare. As Gail1 pointed out the MA Plan focuses on a managed care approach which saves health care dollars that may be used to cover other expenses such as dental, vision, etc. Because these risk taking entities (insurance companies including ACOs) need to reduce costs while improving the quality of care, they initiate programs to better manage the care of patients with serious, advanced, or end of life (EOL) illnesses. This is how they reduce costs, not by denying needed care.

 

With regard to conflict of interest, AARP is not an insurance company. It is a non profit membership organization. It offers medical supplement Plans through United Healthcare Insurance Company, one of the largest insurance companies in the USA. AARP receives compensation for the use of their symbol, AARP, which is  valuable when marketing the medical supplemental Plans As you know, certain endorsements have value. For example, a certain athlete on a cereal box or running/walking shoes, a professional sports team on a cap, a college/university on a sweatshirt/sweater, and so on all have value. I do not believe that is a conflict of interest. In fact, it may encourage Medicare folks to address the need for obtaining more medical coverage. I am providing a link to an article regarding sources of coverage. https://www.kff.org/medicare/issue-brief/a-snapshot-of-sources-of-coverage-among-medicare-beneficiar... As Gail1 pointed out, there is a significant number of folks (article indicates over 5 million) without medical  supplement coverage. Maybe a MA Plan can help address this shortfall. 

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Honored Social Butterfly


@dn7053 wrote:

Your response omits the conflict of interest AARP has in promoting the privatization of Medicare, since AARP rakes in hundreds of millions of dollars annually from its own MA plans, even though these plans make their profits by denying needed care to AARP members who enroll in them.


Since AARP UHC also has Medicare Supplemental Plans also which is also private insurers - which they also receive brand royalties from - should BOTH be removed - MA plans and Medigap (Medicare Supplemental plans).

 

If Medicare itself had a cap on out of pocket cost and all beneficiaries that don't have low income and get Medicaid had to pay some out of pocket cost, it would be better for everybody in the program.

 

As it stands now - some people are not gonna spend the hundrend or hundreds per month on a Medigap plan - some prefer the Medicare Advantage way.  In fact, almost 50% of beneficiaries are electing for MA plans rather than the traditional program with or without a Medicap supplemental policy.

 

MA plans offer the same benefits as the traditional program - just paid for in a different way.  

It's Always Something . . . . Roseanna Roseannadanna
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