Now is the time to compare Medicare Advantage and Medicare Part D plans
A record number of Medicare Advantage plans will be available nationwide as alternatives to traditional health insurance for 2022, according to new analysis from the Kaiser Family Foundation.
That’s 8% as of 2021 and the highest number of plans available in more than a decade, according to KFF.
At the same time, KFF reports that the number of stand-alone Medicare Part D drug plans to be offered in 2022 decreases by 23% to 766 plans, mainly due to corporate consolidations leading to fewer offers of. plans sponsored by Cigna and Centene, according to another analysis from KFF.
Here’s a look at some of the changes, according to KFF.
Advantage of Medicare
More than 26 million Medicare beneficiaries, or 42% of all beneficiaries, currently benefit from Medicare Advantage plans, which are mostly HMOs and PPOs offered by private insurers that are paid to provide Medicare benefits to registrants.
In 2022, a typical beneficiary will have a choice of 39 plans in their local market. But the number of Medicare Advantage plans available varies widely across the country, with an average of 42 plans in metropolitan areas and 25 plans in non-metropolitan areas. As of 2022, 25% of beneficiaries live in a county where they can choose from 50 Medicare Advantage plans.
For his part, Thomas Wright, president of The Turning 65 Workshop, said that “the large number of Medicare Advantage options creates a lot of confusion and makes it very difficult for the average person to” make “cover” purchases.
Most Medicare Advantage plans (89%) include prescription drug coverage, according to KFF. Of these, 59% do not charge any additional premiums beyond the standard Medicare Part B premium. Over 90% of out-of-group Medicare Advantage plans offer benefits for vision, telehealth, hearing, or dental care.
Part of the appeal of Medicare Advantage plans, according to Jae Oh, author of Maximize Your Medicare, is the cost as well as the convenience of having prescription drugs covered at a lower cost than a stand-alone prescription plan. of Part D and the original Medicare.
Although the average beneficiary has access to plans offered by nine different companies, Medicare Advantage enrollment is concentrated in plans managed by UnitedHealth (A H) – Get the UnitedHealth Group Incorporated report, Humana (HUM) – Get the report from Humana Inc. (HUM), and subsidiaries of Blue Cross Blue Shield. Together, UnitedHealth and Humana represent 45% of Medicare Advantage enrollments in 2021.
One potential downside of Medicare Advantage plans is that its annual contract and features change every year.
âIt’s not necessarily negative because it can mean additional additions, additional benefits, additional access to additional benefits which can be very important to the policy owner,â Oh said. âNonetheless, it makes the fact that changing is uncomfortable for many. And, on top of that, the ability to compare becomes more and more complicated. Unfortunately, I don’t think this trend will end anytime soon.
Due to consolidations in the stand-alone drug plan market, the typical Medicare beneficiary will have a choice of 23 stand-alone drug plans next year, seven fewer than in 2021, according to KFF. Beneficiaries receiving Low Income Grants (LIS) will also have fewer options for no-premium plans in 2022, which could make it more difficult for some registrants to find a no-premium plan that covers all of their prescription drugs.
âIt has made things a little more difficult as we approach 2022,â Oh said. “If anyone is now looking to assess which plan to choose for 2022, obviously if you were on original Medicare and you have to choose a Part D plan, that task has become a little more difficult.”
In the stand-alone drug plan market, KFF reports that eight of the 10 enrolled next year are expected to be in stand-alone plans managed by just four companies: CVS Health (CVS) – Get the CVS Health Corporation report, Centene (CNC) – Get the report from Centene Corporation, UnitedHealth and Humana.
The estimated average monthly premium for stand-alone Medicare Part D drug plans is expected to be $ 43 in 2022, based on current enrollments, while average monthly premiums for the 16 national stand-alone drug plans available in 2022 are expected to range from $ 7 to $ 99.
According to Oh, beneficiaries who face fewer Part D options may decide to switch from original Medicare to a Medicare Advantage prescription drug plan for cost reasons.
Almost three-quarters, or 10 million, of the 13.3 million stand-alone drug plan members who do not qualify for low-income grants will have to pay higher premiums next year. ‘They’ll stick with their current plan, and many will also face higher deductibles and cost-sharing for covered drugs, KFF reports.
As the weighted average monthly PDP premium increases by $ 5 between 2021 and 2022 (from $ 38 to $ 43), nearly 4 million non-LIS registrants (28%) will see a premium increase of $ 10 or more per month, according to KFF. Much fewer non-LIS registrants (0.2 million, or 2%) will see a reduction in premium of the same magnitude.
âThe biggest concern I hear for Part D prescription coverage remains the potential for crippling out-of-pocket expenses,â Wright said. âMy final understanding is that a provision for an annual cap of $ 2,000 is still in effect in the pending Build Back Better bill. For individual registrants, this would have huge consequences … far greater than any market consolidation problem.
It’s hard, but be sure to compare
A recent KFF analysis found that seven in 10 Medicare beneficiaries report not having compared their options during a recent open enrollment period.
Admittedly, comparing and choosing from the wide range of Part D plans can be difficult, as the plans differ from each other in several ways, beyond premiums, including cost sharing, deductibles, deductibles, covered drugs and pharmacy networks, wrote KFF.
And comparing Medicare Advantage drug plans can be made more difficult by the fact that not only drug coverage varies, but also other features, including cost sharing for medical benefits, provider networks. and the coverage and costs of additional benefits, KFF noted.
But it is essential that beneficiaries compare their options to avoid costly mistakes. âIt’s complicated, but it’s worth it,â Oh said. “The difference in overall financial costs is several hundred dollars a year, if not more.”
Frequently Asked Questions
KFF has also updated its collection of frequently asked questions about open enrollment in Medicare, which runs through December 7, to help beneficiaries understand their options during the annual open enrollment period.