Changes Coming to Medicare Advantage Plans…

Earlier in the year, CMS issued guidance for health insurance companies that offer Medicare Advantage plans, allowing them to offer a broader set of non-Medicare or non-medical benefits in 2019 plans.

We are already familiar with added non-Medicare benefits, such as dental/vision/hearing benefits, as well as health club memberships, such as Silver Sneakers. Some plans also currently offer an over-the-counter products allowance. Plans will now be allowed to package other benefits, in the interest of getting to better health outcomes. Benefits such as transportation to home delivered meals, to in-home health safety improvements, to tele-health services. The list of allowed services is expansive, perhaps even extending into long term or extended care benefits.

In all practicality, offering such non-Medicare benefits will take a few years to find markets. Carriers will have to determine exactly which such benefits will work in their markets, and then also how to pay for those benefits. In the short term, we may see a much smaller set of benefits being offered so the carriers can see how they will “play” with consumers. As more Medicare beneficiaries turn to Medicare Advantage, and the medical health outcomes with MA plans continues to improve, it is likely that the expansion of such benefits will continue apace.

Something old is something new…

The 21st Century Cures Act was signed in to law in December 2016. One of the many provisions in that bill, some of which we’ve commented on in previous newsletter issues, directed the re-establishment of the Annual Open Enrollment Period in 2019. So what is all this about?

When the Affordable Care Act was passed in 2009, a handful of provisions related to Medicare were included in the act. One such provision replaced the Annual Open Enrollment Period with the Annual Disenrollment Period. At the time, and for a couple of years afterwards, Medicare advocates tried to get a bill passed to re-instate the popular AOEP. Now, after so many years, that wish is finally coming true.

What does the Annual OEP allow you to do? First, let’s be clear on some terms. In the years following 2009, CMS began to call the Annual Election Period (October 15th – December 7th) “open enrollment.” This was unfortunate since this term is used to refer to several different periods in the health insurance world. AEP allows a Medicare beneficiary who is on a Medicare Advantage (MA) and/or Prescription Drug Plan (PDP) to make changes for the year to come. Moreover, a beneficiary on a Medigap plan can arrange to drop that plan in favor of a MA plan to take effect in the new year. Most of my clients who have a stand alone PDP plan along with a Medigap plan use this period to make changes in their drug coverage to a new plan with improved benefits and costs.

During the re-instated Annual OEP (AOEP), a beneficiary with a Medicare Advantage plan, even if it was just acquired during the recent AEP, can make a one time change to a different MA plan. Someone can also drop an MA plan and go back on Original Medicare. The AOEP cannot be used to make changes to just PDP plans.

If you have any questions when you see all of these terms being tossed about, just give me a call. Also, keep your eye out for your Annual Notice of Change packet, coming out in mid-September. It will either come to you in hard copy form, or by email. It will detail the changes to the Medicare Advantage or Prescription Drug Plan you are on, if you decide to stick with it into 2019.

Posted:: 08/09/2018
R Allan Jensen