As Medicare open enrollment begins, authorities are warning beneficiaries to be aware of sometimes misleading and aggressive marketing tactics by some Medicare Advantage insurers seeking their business. We’ll tell you what the problem is, and then we’ll help you avoid falling into the trap.
Medicare Advantage, also known as Part C or MA, allows Medicare enrollees to use private insurance plans as an alternative to traditional Medicare. The plans are in place of Medicare Part A, which generally covers hospitalization, and Part B, which covers medical costs. They may also provide Part D, or prescription drug coverage as well as coverage for things not covered by traditional Medicare, such as dental and vision care. (Frequently, people enrolled in traditional Medicare will also purchase a supplemental plan, known as medigap, that helps fill gaps in Medicare by helping pay for things like copayments, coinsurance and deductibles.)
There are several differences between Medicare and Medicare Advantage. For example, Medicare Advantage plans typically limit enrollees to a network of providers whereas traditional Medicare will cover services from any provider in the U.S. who takes Medicare.
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As of 2021, about 26 million people were enrolled in Medicare Advantage plans, comprising about 40% of Medicare beneficiaries. That number is projected to increase. The plans report high consumer satisfaction, and they are becoming an increasingly popular alternative to traditional Medicare.
Medicare Advantage Coverage, Tactics Slammed
At the same time, some of the insurers have come under criticism for allegedly aggressive and misleading sales tactics and failing to provide adequate coverage for beneficiaries. In 2021 the Senior Medicare Patrol program saw a 24% increase in marketing complaints last year over the prior year, according to the program’s director, Nicole Liebau. “In addition, the complaints received thus far in 2022 are comparable to the complaints received in 2021. We expect the complaints to spike, like they always do” during open enrollment.
More than 30 members of Congress recently wrote to the Centers for Medicare and Medicaid Services alleging that taxpayers spend an average of $1,538 more per beneficiary in Medicare Advantage than for people enrolled in traditional Medicare, adding up to “$12 billion in overpayments in a single year.”
And yet, the legislators said, “regulators have received numerous complaints regarding access to care and quality of coverage under MA.”
In announcing the letter to CMS, House Ways and Means Chair. Lloyd Doggett, D-Texas, said, “For roughly two decades, Medicare Advantage has misled consumers, imposed medically unnecessary and sometimes dangerous obstacles to receiving care, and endangered Medicare’s fiscal future.”
The New York Times recently reported that most large insurers offering Medicare Advantage plans have been accused in court of fraud. And the National Association of Insurance Commissioners, which represents state insurance regulators, wrote to Congress urging reforms that would allow states the ability to exercise oversight over Medicare Advantage marketing tactics.
Most Beneficiaries Happy With Medicare Advantage
The Better Medicare Alliance, a Medicare Advantage research and advocacy group, disputes much of the criticism.
The alliance commissioned a poll by Morning Consult in December that found, among other points, that 94% of seniors using Medicare Advantage reported being satisfied with their coverage, while 95% said they were satisfied with their Medicare Advantage network of doctors, hospitals, and specialists.
“Medicare Advantage plans’ marketing materials are already subject to careful regulation,” said Mary Beth Donahue, president and CEO of the Better Medicare Alliance. “They must be approved by CMS and are answerable to more than 50 pages of federal guidelines.”
The Kaiser Family Foundation recently released a report reviewing 62 studies published since 2016 that compared Medicare Advantage to traditional Medicare. While beneficiaries reported satisfaction at similar levels, slightly more MA participants switched to traditional Medicare than switched from Medicare to MA. The report suggested these switching rates may be an indication that some MA enrollees were dissatisfied.
“Medicare Advantage outperformed traditional Medicare on some measures, such as use of preventive services, having a usual source of care, and lower hospital readmission rates,” the Kaiser report said. “However, traditional Medicare outperformed Medicare Advantage on other measures, such as receiving care in the highest-rated hospitals for cancer care or in the highest-quality skilled nursing facilities and home health agencies. Additionally, a somewhat smaller share of traditional Medicare beneficiaries than Medicare Advantage enrollees experienced a cost-related problem, mainly due to lower rates of cost-related problems among traditional Medicare beneficiaries with supplemental coverage.”
Some Plan Promoters Accused of Hiding Truth
Trinidad Navarro, the state of Delaware’s insurance commissioner said there are “real problems” with MA marketing tactics. Navarro chairs the anti-fraud task force of NAIC. While there have been instances of outright fraud, often, Navarro said, MA plans just fail to tell consumers the entire truth. That’s not necessarily fraud, he said, but is “misleading and extremely confusing for consumers.”
One source of confusion is that television commercials can be broadcast into broad media markets, but , the benefits they tout might be available only to people living in certain states. For example, Delaware residents might watch programs broadcast from Philadelphia. They will want the benefits of a plan described in a commercial that’s not available in Delaware. They also may be overly influenced by the fact that a celebrity is promoting a particular plan.
“There’s just a lot of problems with the way it’s been marketed,” Navarro said. “If state regulators had the authority to regulate those commercials, we would change them significantly. There’s so much more to these Medicare Advantage plans that are not being conveyed to the consumers.”
Amy Nofziger, director of fraud victim support with AARP, said AARP’s helpline gets a lot of calls about deceptive practices involving mailers, phone calls, emails and even in-person visits from people promoting Medicare Advantage plans.
A big problem, she said, is if someone signs up for an inadequate plan, they won’t know about it until they need coverage, and then it may be too late.Nofziger said salespeople will make their plans sound like they will meet everyone’s needs, “but we know that is not true.”
People will also receive flyers in the mail that appear to be from a government agency when they are not. “The most important thing with any of these things,” she said, “is that you need to be very careful. With any of these plans, you need to really read the fine print.”
She added, “Unscrupulous people will take advantage of anyone regardless of the situation they’re in, especially if there might be a significant commission for them.” Nofziger said caretakers and family members of Medicare beneficiaries should engage their loved ones in conversations about their Medicare enrollment choices, particularly if they are suffering from any cognitive decline because they “might get stuck on a plan that has no value to them.”
Beware of MA Plans that Over Promise
Lakia Turner, director of Delaware’s Medicare Assistance Bureau, said beneficiaries are sometimes attracted to promises of lower costs, such as no premiums, not understanding that there are costs, such as copays when they visit a doctor and more costs as when they visit a specialist.
Another issue is the fact that Medicare Advantage plans limit doctors to those who are in their networks. Sometimes, Turner said, beneficiaries will ask people pushing particular plans if their doctor is part of the network and will be told yes. But later, they will find out the doctor is not under contract with the network. They may have to travel significant distances to reach in-network providers.
How to Avoid Being Misled
The key, Turner said, is for beneficiaries to educate themselves before enrolling in a MA plan. Get any promises in writing and confirm with your doctors that they are part of the plan’s network.
Each state has a State Health Insurance Assistance Program, or SHIP, that provides free help for people considering their Medicare options, including during open enrollment. Beneficiaries are encouraged to consult their state’s SHIP when making these decisions.
And even though states don’t have oversight of Medicare Advantage marketing practices, Navarro noted that many of the insurance companies also have plans that do fall under state regulation, making the companies amenable to responding to concerns raised by state officials. So if you run into a problem, you should report it to your state insurance department.
Medicare open enrollment runs from Oct. 15 through Dec. 7. But if you get locked into a Medicare Advantage plan you want to change, you do have a chance to address that as there is a second open enrollment for Medicare Advantage that runs from Jan. 1 through March 31.
However, if you switch from a medigap plan to Medicare Advantage, you may have trouble re-enrolling in medigap.
Rules For MA Promoters
According to Medicare.gov, people promoting Medicare Advantage plans are restricted in what they may and may not do. For example, they are not allowed to visit beneficiaries’ homes uninvited “to sell or endorse anything.” They also may not call you unless you’re already a member of their plan. If you do belong to the plan, the agent who helped you join may call you.
They also may not offer you cash or gifts worth more than $15 to get you to join their plan or provide you with free meals during a sales pitch.
Furthermore, they cannot sell you a product not related to health, such as an annuity or a life insurance policy, while they are delivering a sales pitch for a Medicare plan.
In addition, they must send you a bill and not ask you to pay over the phone or online.
If you agree to meet with them, they are restricted in what they may do during a meeting. According to Medicare, they may not:
During the meeting, Medicare plans and people who work with Medicare can't:
- Charge you a fee to process your enrollment into a plan.
- Steer you into a particular plan.
- Communicate incorrect information about their plan type or use inappropriate statements like their plan is "the best" or "highest ranked."
- Tell you about other plan options you haven't agreed to discuss, unless you specifically ask about them (to discuss these options, you need to complete a separate appointment form).
- Pressure you to join their plan by saying things like "you have to join this plan or you won't have coverage next year."
- Ask you to give names and phone numbers or addresses so they can sell to your friends or family.
- Ask you to sign the enrollment form before you’re ready to join.ist
If you need help with Medicare enrollment or want to report potential enrollment fraud, you can call 1-800-MEDICARE (1-800-633-4227) or your state’s Senior Medicare Patrol. The Senior Medicare Patrol can help you identify and report fraud schemes, including illegal marketing and billing for services that weren’t provided.
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