Allen Health Insurance Agent warns of auto switch to Medicare Advantage
On July 26, the Washington Post reported the case of a woman who had been switched from Medicare to Medicare Advantage without her knowledge.
Apparently this is perfectly legal: when one of their health insurance customers becomes eligible for Medicare, an insurance company can automatically enroll the customer in one of its Medicare Advantage plans. The insurance company does have to tell the customer what’s happening, but the heads up notice goes by mail. The problem is: a person approaching their 65th birthday is inundated with mail offering Medicare supplements, Medicare prescription plans – and Medicare Advantage plans. (If I know one of my customers is headed for Medicare, I tell them to get a bigger mailbox.) The auto switch warning likely gets recycled with the rest of the junk mail overload.
Medicare Advantage plans do have their advantages: they are considerably less expensive than Medicare supplement (medigap) plans, and include hospital, medical and prescription coverage, in one package. The major problem we have found is that Medicare Advantage plan clients have to go to in network doctors to minimize out of pocket costs. By contrast a person on “original Medicare” (with or without a Medicare supplement plan) can see any doctor or other healthcare provider who accepts Medicare. Someone who doesn’t realize the switch has been made might unwittingly go to an out of network hospital without realizing their mistake until the bills start rolling in.
The best defense against “seamless conversion” as the practice is called, is to closely examine every single piece of mail that comes from the health insurance company that issued your under 65 coverage, and to call your agent with any questions. Note also that you do have 60 days to opt out of the switch.
I have not heard of any of our companies who engage in seamless conversion in Texas (the case reported in the Washington post was about Blue Cross of New Mexico) but I do know that Aetna, CIGNA, Humana and United Healthcare have asked Medicare for permission to begin the process. Significantly, Blue Cross Blue Shield of Texas is a subsidiary of Healthcare Service Corporation, who also owns Blue Cross Blue Shield of New Mexico.