Making the Right Medicare Decision

Older Americans are facing a Medicare health care system featuring more options -- and more uncertainty....

From the WebMD Archives
Medicare health care

Where there used to be only one choice in Medicare, seniors now facea myriad of alternatives, from the original fee-for-service plan to a varietyof managed health care options. The U.S. Health Care Financing Administration(HCFA) recently completed a mass mailing of "Medicare and You 2000," ahandbook intended to outline the various choices.

Senior advocates say it is important that seniors select the right Medicareoption -- especially older, more infirm seniors, who have the most healthcare needs. A wrong choice could mean higher out-of-pocket expenses andmore difficulty gaining access to specialists within managed care plans.

A Reason to Be Cautious

Is the new "Medicare and You 2000" handbook enough to help seniors makethe right choice?

No, says Diane Archer, president of the Medicare Rights Center in NewYork, an organization that provides free health care counseling to seniors.Although she praises many things about the handbook, she advises seniorsto be cautious, because the Medicare landscape is shifting dramatically.

For example, Archer says, health maintenance organizations (HMOs) havepulled out of many communities and started charging higher co-paymentsand deductibles. Also, specialists on the plans may not be accepting newpatients.

The cost of private supplemental insurance plans, which cover itemssuch as deductibles in the original Medicare coverage, has also increased,Archer says. Many of the newest managed-care options, like medical savingsaccounts, are no longer available.

"The first thing people need to know is that they do not have to makeany changes if they are happy with their health care plan today," saysArcher, referring to the new Medicare options that Congress created in1997 under the name Medicare + Choice. Archer is echoing a theme of theMedicare handbook, which was mailed to more than 32 million householdsin September and October.

Yet many people have found the book difficult to understand. "We'rehearing from a lot of people who can't get through the handbook," Archersays. "They say they can't find out what they need to know. It's a littledense."

An HCFA spokesman, however, says beneficiaries have mailed more than13,000 response cards back to HCFA, most with positive comments about thehandbook.

Help Beyond HCFA

Archer recommends that people who are considering changing their healthcare option under Medicare seek advice. Every state has a SHIP, or StateHealth Insurance Program, which provides free health insurance counselingon Medicare.

Advocates also recommend that seniors ask their friends about theirexperiences. Archer suggests asking those who have had the most healthproblems, because they will know best how a plan functions.

The American Association of Retired Persons (AARP), the nation's largestmembership organization for older Americans, also offers a variety of bookletsthat can help, from "9 Ways to Get the Most From Your Managed Health CarePlan" to "Medicare Basics," says an AARP spokesman. HCFA provides otherbooklets besides the "Medicare and You 2000" handbook, including a "Worksheetfor Comparing Medicare Health Plans."

For now, if people are unhappy with their choice, they can leave oneMedicare plan and enroll in another within 30 days. That policy, however,will change in 2002, when only one change will be allowed in the firstsix months of the year. In 2003, only one change will be allowed in thefirst three.

Rising Costs

Even with Medicare and the new managed care options, older Americans arefinding health care expenses rising.

"The biggest problem for most people is affording the health care theyneed, even with Medicare," says Archer. "People are telling us they can'tafford to get the care they need, because Medicare supplemental policiesare too expensive, medications are too expensive, and they are having troublewith special needs if they are in HMOs."

The average Medicare beneficiary pays 18 percent of his or her annualincome, or about $2,370, for out-of-pocket health care costs -- over $200more than in 1997, says an AARP official. These costs include buying supplementalinsurance, known as Medigap, to pay for deductibles and co-payments notcovered under the original Medicare plan, as well as prescription drugsand services not usually covered under Medicare, such as dental, hearingand vision care.