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View Diary: Whither Medicaid and CHIP Under Reform? (54 comments)

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  •  I have been very concerned about the need for (0+ / 0-)

    reform of the Medicare Supplemental Insurance rules.

    My elderly father fell into a Catch-22 situation with the current rules.

    It is very hard for people with lower middle class incomes to maintain what is called Original Medicare (i.e. the gov't run, or public option). Original Medicare costs about $100 a month. That covers 80% of your bills, and you pay the rest. Should you find yourself in the hospital or needing treatment for an extended stay, you can quickly deplete your resources (upwards of $200 a day, and then you become poor, and then you qualify for Medicaid, I guess). To avoid that situation with Original Medicare, you can pick up a Medigap policy for $170-$200 a month which will cover these costs. $300 a month for both my mother and father (i.e. 600 a month from their bank accounts, now that they're in their 70s) was a bit too much. (I'm not even getting to the drug side with the donut holes, etc.) So, they elected the cheaper Medicare Advantage plans.

    Big mistake. But more on that shortly.

    IMO, Bush helped subsidize Medicare Advantage to help kill off Original by making it difficult for many retirees to choose it. They were forcing them into the private plans. Here's where Medicare gets a bit nasty.

    When you enroll in Medicare Part B, you have 6 months of an open enrollment period to pick up a Medigap policy (i.e. supplemental policy). After you enroll and pay for Medigap, they will not cover any pre-existing condition for the first 6 months, UNLESS you had a longtime insurance that covered that condition prior to enrolling in Part B. However, in order to force the Medigap plan to cover the pre-existing condition, you must enroll in the Medigap program within 63 days (what a weird arbitrary number) after enrolling in Part B. That's your window, that's your enrollment period. If you miss it, you've lost that enrollment period for life, and from then on, you can be rejected by Medigap plans for health reasons (in other words, you have to undergo medical tests, medical underwriting [as a 65 or 75 year old!!!]). When you see how everything is set-up, you realize that unless you can pay potentially $8k a year, then your options are limited. You are being funneled away from the government option (Original Medicare) and toward the private Advantage insurance plans. And worst of all, once you choose the private plans, you cannot go back to Original easily because of the likelihood that you'll be rejected for Medigap (since your enrollment period has permanently expired).

    To top it off, many of the Advantage plans charge a bit extra ($100 a month) and give you prescription drug coverage (yes, this is a good thing!), so the privates are just killing the Original Medicare option at this point. They are much cheaper. [It should be noted that many of the private plans actually do not cover the prescription drug donut hole, and this may come as a surprise to those who do not read the fine print of their policies.]

    I now think of the rules as a deliberately concocted catch-22 situation that looks almost like a scam.

    OK, so, now that my parents are on Advantage, their first attempt to get back onto Original was a no-go because they couldn't find a cheap Medigap policy that would accept them. The only Medigap policies that did accept them cost more than what they were to pay for the increased premiums of the Advantage policy.

    Regardless, I now consider Medicare to be rigged toward forcing you to a private insurance plan. If I wasn't aware that those private plans are cash cows for the industry, that would be fine. I would be absolutely ignorant of the trade-offs, as opposed to simply ignorant of the specific nature of those trade-offs, as I am now. After all, I have a private plan through my job, and that's what covers my children as well.

    If we are to have Health Care reform, we must also reform Medicare (I know Obama is cutting the subsidies), Medicaid, etc. Actually, Obama cutting the subsidies to insurance companies may backfire in my parent's face if they are not allowed to get onto Medigap, since the insurance companies will surely raise premiums thereafter for Advantage programs.

    The Medigap signup period provisions MUST be changed.

    Look at these people! They suck each other! They eat each other's saliva and dirt! -- Tsonga people of southern Africa on Europeans kissing.

    by upstate NY on Wed Jul 29, 2009 at 11:21:37 AM PDT

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