I posted most of this as a comment earlier today, and several people kindly commented that it would make a good diary. This is my first diary, so be kind.
Medicare is so confusing that I almost jumped thru the TV this morning when Chuck Todd screwed up the HUGE difference between a Medicare Supplement and a Medicare Advantage. I'm on Medicare, as is my wife, so I have studied the system a lot in order to had heads or tails out of it. Go to medicare.org for a full, real discussion.
Go below the fold for a Medicare Primer and some of my thoughts.
So here is a little primer which may help out.
Medicare Part A is hospital coverage. This is part of "Original Medicare". It is basically an 80-20 plan to cover hospital costs. There are no monthly fees for this.
Medicare Part B is physician coverage. This is also part of "Original Medicare". There are co-pays with most services, and there is a monthly fee which for me is $115 that is taken directly out of my Social Security check.
Medicare Part C is now called Medicare Advantage.
Medicare Part D is Drug Coverage. Here is where the notorious donut hole lives.
Medicare Supplements are additions (supplements). There are huge numbers of really confusing options within this.
I'm going to focus on the difference between a Medicare Advantage and a Medicare supplement. They are the two most often confused parts.
An Advantage program is run by a private insurance company which is paid to administer a persons individual Medicare account. They payment is a regular cash payment to them by the government whether service is used or not. (Snark on by bad grammar. Since corporations are people, I should have said "who" instead of "which" above.) The coverage is at a minimum the same as Part A and Part B above, but the companies add features.
The insurance companies love this, as they get a nice, steady cash flow from the government.
The biggest advantage to the Advantage I have is that I have an annual maximum out of pocket of $5,400. With no Advantage program I would have an open ended OOP. So a truly major event, like heart attack, stroke, cancer, would cost me $5,400, but would wipe me out without the Advantage. My plan costs me $0.
A Medicare Supplement can add things like dental coverage, vision, hearing, but are really designed to cover the 20% of hospital that Medicare does not cover. I'm sure that all Supplements are for a fee, and about $100 to probably $400 or $500 a month.
My really biased opinion is this. The Medicare Advantage programs are a SCAM to get big profits for the insurance companies. I have one because of the price ($0) and the OOP maximum. If Medicare laws were modified to put a max on OOP, I think Advantage programs would die. Supplements are a whole nother matter, and up to individuals.
So Obamacare will take some of the profits away from the insurance companies. And Mitt doesn't like that. I'm shocked.
"We borrow this Earth from our Grandchildren."