The Biden administration has proposed steps to protect Medicare Advantage enrollees from marketing ploys and other practices that may put business interests ahead of their health needs.
If finalized, the initiative would impose certain guardrails on the rapidly growing alternative to original Medicare, which now enrolls about half of the nation’s roughly 65 million Medicare beneficiaries. Also known as Part C, Medicare Advantage is run by private insurance companies that contract with the government to provide bundled Part A hospital coverage, Part B outpatient coverage, and often, Part D drug coverage.
Late Monday, the Centers for Medicare and Medicaid Services issued a proposed rule that seeks to ensure that brokers aren’t unduly compensated for steering enrollees into certain Medicare Advantage plans. It also aims to make sure patients take full advantage of their plan’s supplemental benefits, that prior authorization requirements don’t act as a barrier to care, and that beneficiaries have access to behavioral healthcare, among other provisions.
The announcement falls during Medicare’s annual open enrollment period, from Oct. 15 through Dec. 7, when beneficiaries have the opportunity to select new coverage for 2024.
A 60-day public comment period on the proposed rule ends Jan. 5.
Medicare Advantage has grown in popularity in part because many enrollees see the program as a better value than original Medicare. While most Medicare Advantage beneficiaries pay the standard Part B premium, they don’t need the Medigap supplemental coverage that many original Medicare enrollees buy to pay for gaps in coverage, which runs an average of $170.39 a month for some of the most comprehensive benefits, according to HealthView Services.
Many Medicare Advantage plans charge zero premiums and offer a host of supplemental benefits that original Medicare doesn’t, such as gym memberships, basic dental coverage, and even perks for pets. A problem, some experts say, is that members focus too much on these modest free benefits and overlook the trade-offs that Medicare plans involve, including possible limitations on services and participating providers.
What’s more, many Medicare Advantage plans report low usage of supplemental benefits among beneficiaries, the Biden administration said. “To ensure the large federal investment of taxpayer dollars in these benefits is actually making its way to beneficiaries and are not primarily used as a marketing ploy, the proposed rule requires Medicare Advantage plans to engage in minimum outreach efforts so that enrollees are aware of the supplemental benefits available to them,” the administration said.
While Medicare Advantage coverage is often cheaper than traditional Medicare, it comes with some down sides. Many Medicare Advantage plans are HMOs with narrow networks of participating doctors. Beneficiaries must stay within the network or incur much higher costs for care outside. By contrast, on original Medicare, beneficiaries may visit any doctor or hospital in the country that accepts Medicare.
In addition, Medicare Advantage plans often impose more restrictions on care than original Medicare. One such requirement is known as prior authorization, or the need to receive the health plan’s approval before filling a prescription or receiving coverage for a certain service.
The Biden administration’s proposed rule seeks to ensure that prior authorization doesn’t disproportionately hurt underserved populations like low-income and disabled beneficiaries.
The full proposed rule can be read here.
Write to Elizabeth O’Brien at [email protected]
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