The Dark Side of Medicare Advantage Plans

Recently an NPBO Member shared with me a report on Medicare Advantage plans and the increasing amount of prior authorizations that are being required with Advantage plans. But that is just one disadvantage of these plans…

If you, a family member, or a friend receive Medicare, you’re well aware of the uptick in marketing (aggressive marketing) before each annual renewal period. This is true for Original Medicare and Medicare Advantage Plans.

Medicare is a complex topic for consumers and providers alike. So before I go further, let’s do a brief Medicare review.

Medicare Reviewed

To cover our bases, here’s a 40,000-foot overview of Medicare.

Original Medicare, of course, is administered by the federal government and consists of two parts.

Medicare Part A covers inpatient care in the hospital, skilled nursing facilities, hospice, and home health care. Most people don’t pay for Part A because they’ve paid Medicare taxes while working.

Medicare Part B covers outpatient services such as provider visits, lab tests, medical equipment, and some home health. But Part B is not “free,” and there is a monthly premium based on income. Part B does not cover everything and leaves a coverage gap.

The Gap

And this is where extra insurance comes into the picture and why people choose to get additional coverage to bridge the gap.

The extra coverage, called Medicare Part C, comes in two flavors: Medicare Supplement (Medigap) and Medicare Advantage plans.

And this is where it gets interesting…

When I checked Google for the number of Medigap plans in 2023, there were ten. They all have different benefits and cover all or part of the Part A deductible.

At the same time, when asked about Medicare Advantage plans, Google told me there were a total of 3,998 Medicare Advantage plans available in 2023.

Did Google make a mistake? Unlikely…

I can’t help but wonder why the drastic discrepancy.

Insurance companies don’t rush to pick up more subscribers unless there’s money to be made. Unless there’s a healthy profit to be had…

And please, don’t get me wrong; there is nothing wrong with profit. Every business is in business to make a profit.

But I start to ask questions when I can’t see why insurance companies are so eager to sign up more people and how they will make money from it.

I understand it’s a numbers game… So, the number must work for the insurance companies, right? Why else would they do it?

To learn more about these plans, tune in to Episode #75 of the NP Matters Podcast, where Don Self and I talk about Traditional Medicare and Medicare Advantage Plans. Find out what the Advantage Plans are, how they differ from the regular plans, and why so many insurance companies offer them. And, understand how Advantage Plans may hurt providers and patients alike.

You can watch the episode on YouTube, listen to it on this page, or on your favorite podcast app.

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Your Turn

What is your experience with Medicare Advantage Plans? What has worked, and not worked for you? Or have you opted out of Medicare altogether? Share the good, the bad, and the ugly below.

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  1. Thank you for this informative Podcast. Many large hospital organizations are partnering with insurance companies to create their own Medicare advantage plans. It's a huge windfall for them. It's important to remember that insurance companies make money by denying claims. Now they also contract with Radiology benefits managers, Pharmacy benefit managers and create ridiculous , cumbersome and inefficient prior authorization requirements. Many providers are behind the call for Medicare for all, but we have to be careful and know what this means, it should not mean Advantage plans which only increases profits not care.

  2. Hi Sonja, good to hear from you.
    You are correct, they are not the only ones doing this. The mega clinic I go to does this as well. I just wish we could provide care to patients without the ridiculous red tape and have to have a desk clerk “approve” our request and that sort of nonsense.

    Medicare for all (universal health) can be good, but we, as people have to agree to pay for it, and….well, I don’t want to get too politial here, but we need some changes in Washington.

    Take care and Happy Winter Holidays!

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