December 10, 2013
In a recent letter to the Sentinel, the writer said that he was on Medicare and complained that he and his wife’s premiums will jump 50 percent, to $70 per month each, on Jan. 1st, 2014. He blamed this increase on the Affordable Care Act, which he derisively called “Obummercare.” I am on Medicare too and such a huge rise seemed unbelievable to me. He must not be enrolled in original Medicare, I thought, but in Medicare Advantage, the private insurance version of Medicare. I determined to find out.
At Medicare.gov I learned that under original Medicare, the Part B premium won’t increase at all for 2014 and that most people get Part A premium-free. My Medicare Part D prescription drug plan premium will increase from $18.50 to $22.80. (Premiums from other Part D insurers may increase by a greater amount). As a result of my search, it was obvious to me that our writer is enrolled in a Medicare Advantage plan. His exorbitant premium hike is the result of a decision made in some corporate boardroom and driven by the most typical of corporate motives – profit.
Some Sentinel readers may have understood our writer to be implying that he was enrolled in original Medicare. They may have become alarmed, fearing a big rise in their own premiums. Let me assure Morrow County original Medicare enrollees that their premiums will go up by only the small amounts stated above. Sentinel readers can go to the webpages below and verify these numbers for themselves.
For many years the federal government has been paying private insurance companies an average of 14 percent more for providing coverage to Medicare Advantage beneficiaries than it would pay for the same beneficiary in the traditional Medicare program. (This has been a gift that keeps on giving from Congress to the health insurance industry).These overpayments have been as high as 20 percent in certain parts of the country and don’t always result in extra benefits or improved quality care for Medicare Advantage seniors. Because private insurance companies have the right to determine their own cost-sharing arrangements, seniors can end up spending more out-of-pocket under a Medicare Advantage plan, not less.
Over the years Medicare Advantage plans have offered members reduced-price or free eyewear, gym memberships, yoga classes and other services unavailable to those of us on original Medicare. I was shocked to learn recently that seniors on original Medicare (three-quarters of seniors) have for years been paying an extra $43 per year in Part B premiums to subsidize the government overpayments which insurance companies use to provide the extra benefits enjoyed by the one-quarter of seniors who are enrolled in Medicare Advantage plans.
At this point we must ask ourselves: Why should the government pay an insurance company $114 to $120 to provide a medical service which the government itself can provide for only $100? And: Why should enrollees in original Medicare pay an extra $43 per year in Part B premiums so that Medicare Advantage members can get a free gym membership or a free pair of eyeglasses?
The Affordable Care Act has put an end to this nonsense by reducing overpayments to private insurance companies and ordering that 85 percent of all Medicare Advantage premiums be spent on health care benefits for members rather than administrative costs, executive salaries and shareholder profits. The ACA is also saving money for the three-quarters of seniors who have been paying extra Part B premiums for the benefit others, not themselves.
Now that the government has cut its overpayments to the healthcare insurance companies, these companies must somehow make up this lost revenue to continue funding their obscene profits and extravagant CEO salaries. Increasing enrollee premiums is their only option.
I say to all seniors enrolled in Medicare Advantage plans: Don’t let greedy insurance companies take advantage of you. Don’t be trapped in a never-ending upward spiral of increasing and excessive premiums. Save your money. Come back to original Medicare. It provides first-rate medical services to seniors. You can choose your own doctors. You can choose your own hospitals and your own specialists. I did when I had my open heart surgery two years ago.
The Affordable Care Act will continue to save more taxpayer money as the wrinkles are gradually ironed out in its implementation. Last week the Centers for Medicare-Medicaid Services announced that Obamacare has already saved seniors and people with disabilities $8.9 billion on Medicare prescription drug plan coverage. That’s no bummer!
Edward Taylor, Mount Gilead