Well, open season for changing Medicare insurance is over (although you can still change your prescription drug insurance, Medicare Part D, until tomorrow). How did it go? Did you keep the insurance you had? If you did you would be in good company, historically over 80% of us don’t change our insurance. Did you take the opportunity to really evaluate your options or did you just take a cursory review, or did you let the opportunity go by and just keep the insurance you had continue for another year? Many people I have talked with didn’t take the time to review their insurance, a dangerous approach given the changes that are going on, to say nothing of the changes to your health that might occur. I warned, cajoled, even begged everyone in earlier blogs to take the time to review their coverage. I hope some of you listened. Let me tell you what steps I went through as I reviewed my insurance and how I made my final decision.
I moved last year and, for the first time, chose a Medicare Advantage (MA) plan. Generally, a MA plan offers more benefits, usually some discounts or free memberships to health clubs, often some hearing benefits, maybe even dental and eye benefits. Surprisingly, these often come with no premiums. For me this was a big change from the premiums I was paying with my old supplementary insurance. As you might imagine these benefits and low or no premiums are offset by some stipulations and rules that need to be considered. Often their network of doctors and hospitals is more restricted, and your copays and other out-of-pocket costs are larger. Many MA plans include prescription drugs, but their formulary may be more tightly controlled. Since MA plans get paid a fixed cost for each member of their plan, they are incentivized to keep you healthy, hence the focus on fitness, healthy living, and preventive care. They are also focused on keeping costs down. Those are the tradeoffs I looked at going into the open season.
I first read my insurance company’s Annual Notice of Changes. I was pleased to find that my copayment for a specialist dropped 20% and for hospital specialists and treatment dropped $110 dollars or 25%. That was big for me since I had paid both of these copays for some tests that I had. The tests turned out fine, but it was pleasing to see that I will pay less in 2021 if I need that sort of healthcare. My drug plan stayed the same except for a big reduction in the cost of insulin in 2021 which was capped due to legislation and rules instigated by Washington. This will have a big impact on many diabetics. Given the healthcare needs of my wife and myself we found that staying with are current MA plan continued to save us money and fit our situation.
I hope that increased competition gave you more choices and more opportunity to save money in 2021. I will be really interested to see what next year’s open season brings. With the hope of vaccines allowing us to return to normal by the second half of 2021, we could see many changes in how healthcare is administered. Telehealth, in-home tests, more sophisticated medical devices to monitor our health, may all lead to changes to how we receive and pay for healthcare.
The new administration will certainly be pressured to control healthcare costs. I hope they see how competition is the quickest and best way to balance access with cost. I’m convinced that the reason my MA plan dropped their copays was not because they had a banner year — many doctors and hospitals saw a big drop in revenue due to the pandemic. What these plans do see in 2021 is a big increase in healthcare demand due to our country’s return to normal as we emerge from the pandemic and an increase in competition to satisfy that demand. A system that is based on cost controls and limited access would not respond as quickly, or at all, to this increased demand.
Keep track of your costs and access to care in 2021. Document the changes in your health. Know where you stand with your prescription drug costs. These are all things that will help you make an informed choice when next year’s open season rolls around. It could have a big impact on your cost and level of care going forward.
Stay Healthy, Thair