New Medicare Managed Care Plans Create Confusion
Medical Economics Feature - May 2007
One patient was forced to choose an insurance plan she really didn't want. Another is afraid to see his doctor because he fears getting a bill he can't pay.
Those two cases are real examples of confusion for some patients - and headaches for physicians - resulting from the Medicare Advantage plans offering seniors a replacement for traditional Medicare. When Congress authorized the new products four years ago, the idea was to give beneficiaries more choices and, in some cases, more benefits.
But physicians complain that many of their elderly patients do not understand that they are giving up traditional Medicare for private health plans operated by commercial health insurance companies.
Doctors also say some patients are stuck with higher out-of-pocket costs, that they sometimes have difficulty getting paid, and that they cannot choose to opt out of some of these plans without severing their relationship with the patient.
Centers for Medicare & Medicaid Services (CMS) officials admit that some "enrollment" issues have created confusion over patients' coverage and that some seniors may have been misled or confused about what coverage they were buying.
Where's the Advantage?
The Medicare Advantage plans were authorized under the Medicare Modernization Act (MMA) of 2003 to replace the old Medicare + Choice plans. Texas Medical Association officials say the MMA substantially revamped Medicare "replacement" products and created a much larger market for them.
The law kept the Medicare HMOs created under Medicare + Choice, but added several new types of products, including PPOs, special needs plans targeted at enrollees who are institutionalized and/or have chronic illnesses, and private fee-for-service (PFFS) plans, which allow patients to go to any Medicare-approved physician or hospital.
Medicare Advantage plans were first offered to beneficiaries in 2006, and several major commercial insurers and a few smaller companies sell the plans in Texas. They include Humana, UnitedHealthcare, Blue Cross and Blue Shield of Texas, Texas Community Care, Universal Health Care Inc., and others.
The greatest confusion appears to involve the PFFS plans, in which enrollment has significantly increased in 2007.
Unlike an HMO or PPO, a PFFS plan has no network. Patients are allowed to see any physician who participates in Medicare and accepts the plan's terms and conditions.
Universal Health Care markets its PFFS plan under the name Any, Any, Any Plan, which stands for any doctor, anytime, anywhere. Physicians are supposed to be paid at 100 percent of Medicare-approved rates; no referrals, precertifications, or preauthorizations are required; and there are no contracts to sign. Physicians may collect applicable copayments, but balance billing is prohibited.
The Any, Any, Any Plan was first offered in Texas on Jan. 1 and already has 14,000 enrollees, says Greg Allen, Universal Health Care's director of provider operations.
PFFS plans are heavily marketed to Medicare beneficiaries, who often find them attractive because they offer all the coverage of traditional Medicare, plus additional benefits such as transportation coverage or a prescription drug benefit.
But while "any doctor, anytime, anywhere" may sound appealing, many beneficiaries are finding that is not the case. Many Texas physicians are opting not to participate in the PFFS products because they say they often pay less than 100 percent of Medicare.
Katherine Grigsby, director of contracting for Oncology Consultants in Houston, says her practice decided not to accept Medicare Advantage products because they refuse to negotiate the price of chemotherapy drugs.
In addition, many of the plans have patient copayments of up to 20 percent to 25 percent, and federal law bars patients who opt for Medicare Advantage coverage from purchasing Medicare supplemental coverage. That means chemotherapy patients are stuck with large copayments they often can't afford, she says.
Putting on the Pressure
Some physicians say their elderly patients who have signed up for Medicare Advantage plans don't really understand that they no longer have traditional Medicare or feel they were pressured to switch.
Carolyn Lehmann, practice manager for the Center for Spine, Sports, and Physical Medicine in Tomball, says one elderly patient was told she had to switch to a PFFS plan because she was dually eligible for Medicare and Medicaid. She says the patient ultimately was able to switch back to traditional Medicare, but that has not been easy for everyone.
Lisa Fehrenkamp, practice administrator for her husband, Austin endocrinologist Steven Fehrenkamp, MD, says an elderly patient with diabetes signed up for Texas Community Care but now is afraid to go to the doctor because he's "running up bills that they can't get paid."
Ms. Fehrenkamp says the patient and his wife unknowingly switched to the PFFS plan, then switched back to traditional Medicare when they realized what had happened.
In the meantime, neither Texas Community Care nor TrailBlazer Health Enterprises - the state's traditional Medicare carrier - will pay the bills because each claims the couple is enrolled in the other's plan.
"No providers are getting paid for this elderly, infirm patient," she said. "And he's worried about going to the doctor because he thinks he's going to get stuck with those bills."
Art Pagan, branch manager for Medicare Advantage and Health Plans in the Dallas CMS regional office, says situations such as these were created by CMS's problems in synchronizing its Medicare Advantage enrollment system with the systems that physician offices use to determine eligibility. He says there also was confusion over patients' coverage because the CMS enrollment system uses similar codes for all Medicare Advantage plans, meaning physician offices could not determine if the patient had a PFFS plan or an HMO or PPO.
Those problems are being corrected, Mr. Pagan says.
Meanwhile, CMS has received numerous complaints about misleading marketing and beneficiaries being pressured to switch to Medicare Advantage plans. Some of those complaints are arising from the actions of independent brokers that some plans use to sell their products.
"We're keeping data where we do get complaints from the beneficiaries about that," Mr. Pagan said. "And we have taken actions against certain plans, and those plans, in turn, have taken action against the particular brokers."
The American Medical Association is developing pamphlets to help physicians understand Medicare Advantage plans. They will be posted on the AMA Web site at www.ama-assn.org.
AMA also is planning an educational session on Medicare Advantage plans during its annual meeting in Chicago in June.
Ken Ortoloncan be reached by telephone at (800) 880-1300, ext. 1392, or (512) 370-1392; by fax at (512) 370-1629; or by email at Ken Ortolon.
CMS Posts Medicare Advantage, Part D Info on Web
The Centers for Medicare & Medicaid Services (CMS) has created a new section on its public Web site to house contract and enrollment data about Medicare Advantage and Part D prescription drug plans.
Log on to www.cms.hhs.gov/MCRAdvPartDEnrolData .
This site has a health plan directory and a Medicare Advantage claims-processing contact directory. The directories contain basic information about the contract, as well as contact information for the plan itself. The information is posted in three formats: a PDF document sorted by contract name, a PDF document sorted by contract number, and an Excel version.
CMS says it will update the directories monthly.
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