Many Risk Insurance Benefits

Medicare’s annual enrollment period begins Monday with a number of insurance companies having either changed their offerings for 2011, or completely backed out of the regional market.

Many of the biggest changes have occurred in the Medicare Advantage plans available in the Roanoke and New River valleys. Because of a change in the federal government’s rules governing these plans, many have been discontinued, leaving thousands of seniors to enroll in a new option or risk being left without prescription drug coverage and only the basic traditional Medicare.

The change comes from the Medicare Improvements for Patients and Providers Act of 2008, which required private fee-for-service Medicare Advantage plans to have networks of providers in most counties beginning in 2011. There are some exceptions, which means some of these private fee-for-service plans do still exist in the region’s more rural counties, such as Bedford, Floyd and Giles counties.

The move has national implications, with choices for Medicare Advantage plans declining throughout the country by about 13 percent, according to the Henry J. Kaiser Family Foundation. Still, as of September, nearly one-fourth of the total eligible population was enrolled in a Medicare Advantage plan, according to Kaiser.

In Roanoke, the decline will be sharper. The number of plans offered here has dropped from nine operating in 2010 to five for next year, said Shannon Abell, director of senior services at the LOA Area Agency on Aging.

Abell said he has already filled every free consultation slot available through Dec. 31 and has started a waiting list that, as of Wednesday, had 30 people on it.

“Each year, it just gets worse because there are more seniors every day with the aging population,” Abell said. “And people are just more confused. Nothing has really simplified about the process, so seniors are just getting more and more confused.”

The largest plan to leave the local market is Cigna. Its 4,500 enrollees must now shop for either a new Medicare Advantage plan or a prescription drug plan likely coupled with a supplemental Medicare benefit.

Anthem Blue Cross and Blue Shield of Virginia is another company that has discontinued some of its plans that are fee-for-service, impacting approximately 600 people in the region.

“Because of the cost of that, many insurers have chosen not to build PFFS [Private Fee For Service] networks, and instead rely on their own HMO or PPO networks,” said Anthem spokesman Scott Golden.

Golden said Anthem is working to move clients whose plans have been discontinued into other available Medicare Advantage plans.

In all, insurance experts with Carilion’s Medicare Advantage plans calculate there are close to 10,000 people in the Roanoke and New River valleys who are currently enrolled in a Medicare Advantage plan that will no longer exist next year.

In part, Carilion hopes to capitalize on the shrinking number of plans as it seeks to expand its new insurance business

Carilion introduced its insurance plan last year with expectations of enrolling 3,000 people. But the nonprofit health system fell short of that goal, having only enrolled 270 as of September.

For 2011, Carilion is aiming to have 3,200 people enrolled in its eight-county coverage area, said Bryan Hyler, sales director for Carilion Clinic Medicare Health Plan.

Marketing plans

With all the changes, seniors — and those who qualify for Medicare because of disability — are being inundated with advertisements.

This includes a strong push from LewisGale Regional Health System, which has launched a marketing campaign aimed at warning patients that they will not be able to access their doctors and services if they choose the Carilion plan or the Medicare Advantage plan offered by Humana.

“We wanted to make certain that the public — those people who are eligible for Medicare Advantage plans — we wanted to make certain that they understood specifically which ones we were participating in and which ones we were not participating in,” said Nancy May, LewisGale’s spokeswoman and vice president for marketing. “I think, you know, a lot of the changes, the addition of new products like Humana and just the changes that occur each year with any type of coverage, I think that can be confusing.”

May said she and her staff are already fielding calls from patients who are concerned about making the choice that will allow them to still seek care at LewisGale.

Abell said his office has been overwhelmed with calls from confused Medicare participants, many who are calling with questions directly related to LewisGale’s advertisements.

“Many people like to go to both LewisGale and Carilion, so it’s an issue that hits home with them,” Abell said.

The constraints of having to stay in the network of a Medicare Advantage plan is one of the reasons Abell said he has never recommended it to people who seek his advice.

“I want choice,” he said. “I want the ability to go wherever I want to go.”

Medicare Advantage plans work either as a health maintenance organization or a preferred provider organization, similar to how employee health plans are structured in the private world. Unlike traditional Medicare, however, these plans cover extra benefits like vision, dental and wellness programs. Many also include prescription drug coverage, or a Part D plan.

With Medicare Advantage, private health plans enter into contracts with the government that allow them to offer coverage to enrolled patients.

Carilion is set up as a health maintenance organization and offers four tiers of coverage from a network that includes seven hospitals and more than 600 physicians.

Other changes

Complicating this year’s annual enrollment period, there are several other changes affecting Medicare.

First, the enrollment options for Medicare recipients has changed. While the seasonal period has remained the same, and all Medicare recipients can review and change their plans between Monday and Dec. 31, a second enrollment period that used to run from January through March has become much more limited. Experts recommend that seniors make their decisions before 2011.

“A lot of these folks don’t realize this, and they are going to get stuck if they wait too long,” said Mark Murphy, an independent insurance advisor with Advance Senior Benefits Solutions in Roanoke.

There is an exception. Those people whose plans have been discontinued have a longer enrollment period. For them, it began in October and will continue through Jan. 31.

Still, Murphy said, no matter what kind of Medicare plan a person has, he or she should review the options, even if looking at traditional Medicare and a Part D prescription drug plan, instead of Medicare Advantage.

“For some people, that is the absolute best option,” he said. “Not everyone should be in an advantage plan.”

The government has tools online to help people make selections, and representatives from various plans are also available to help.

Abell said that even though his office is filled for appointments, he is answering the phone. And Murphy said agents like himself are also trained to help.

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About Rick Hemphill

Mr. Hemphill is a 34 year veteran of the Insurance & Financial Services Industry & Lifetime member of the Million Dollar Roundtable.

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