(CNN) — Attention Medicare Advantage enrollees: It’s a good idea to review your plans during open enrollment, which begins this Tuesday, so you aren’t surprised next year.
Although the fast-growing market remains stable overall, insurers are making a number of changes that could leave some senior citizens seeking new policies, paying more out of pocket or receiving more limited supplemental benefits.
“In recent years, this is the biggest benefit disruption we’ve seen in the market,” said Lindsay Knable, a partner at consulting firm Oliver Wyman.
The changes come as Medicare Advantage enrollment is expected to reach 35.7 million, or 51% of total Medicare enrollment. Under the Medicare Advantage program, which serves as an alternative to traditional Medicare, the federal government contracts with private insurers to provide Medicare coverage to beneficiaries, many of whom are very cost-conscious since they are on fixed incomes.
However, few enrollees purchase during open enrollment, which runs through December 7. Nearly two-thirds of Medicare Advantage participants did not compare their coverage with other options for 2022, according to a recent analysis by KFF, a health policy research organization.
Enrollees should review their annual notice of changes to know what might change by 2025, said Jeannie Fuglesten Biniek, associate director of KFF’s Medicare Policy Program.
“People really have to pay attention to understand what they’re signing up for,” he said.
Finished plans
This year, more than 1.8 million Medicare Advantage members, or about 8% of those in non-group and non-special needs plans, are enrolled in policies that will not be offered in 2025, according to an analysis by Oliver Wyman. About 1.3 million of them are currently enrolled in $0 premium plans.
That means they will have to actively select new plans or be placed in traditional Medicare. By comparison, approximately 230,000 members, or about 1%, were in this situation by 2024.
Humana and Aetna are the most aggressive in cutting their offerings, with about 10% of their membership affected by the changes, according to David Windley, senior equity analyst at Jefferies. Approximately 5% of those enrolled in UnitedHealthcare and Centene policies will be affected.
Still, almost all senior citizens will have a variety of other options to choose from. On average, they will have 34 Medicare Advantage plans with drug coverage to choose from in their county by 2025, up from 36 this year, according to the Centers for Medicare & Medicaid Services. (These figures do not include special needs plans available only to enrollees in specific situations.)
“Offers are stable and people will continue to have wide and affordable options both in the markets of [Medicare Advantage] as in Part D [plan de medicamentos]”Dr. Meena Seshamani, director of the Center for Medicare, told reporters last month.
Additionally, average monthly premiums for the plans will decrease to $17 next year, a reduction of $1.23 from this year, according to the agency. Approximately 60% of enrollees who remain in their current plan will have a $0 premium in 2025, and the vast majority of members will have the same or lower premiums next year if they remain in their current plan.
Although it is discontinuing some plans, Aetna will still have affordable policies for 59 million Medicare-eligible beneficiaries, said David Whitrap, a spokesman for the insurer. It will offer plans in 76 new counties next year.
“By 2025, Aetna is investing in markets where we can offer competitive, high-quality and affordable benefits in a way that is sustainable for our business,” he said in an email.
Higher drug deductibles
Senior citizens will also need to check if they will have to bear more out-of-pocket costs next year, especially for medications.
This year, more than 16 million enrollees are in plans with no deductible for any medications, according to Greg Berger, a partner at Oliver Wyman.
But in 2025, more than 45% of these members will be subject to a deductible for at least some drugs, especially brand-name or specialty drugs, if they stay in the same plan.
About 36% of Medicare Advantage enrollees with prescription drug coverage are in plans whose drug deductibles will increase by at least $200, according to Jefferies. Those on UnitedHealthcare and Aetna are the most likely to face higher deductibles. (The maximum deductible for medications is US$595.)
Some insurers are also cutting their allowances for dental, hearing and vision benefits. For example, Aetna is reducing its allocation by more than $1,700 a year, on average, across its top 20 plans, while UnitedHealthcare is reducing it by just over $750 a year, on average, Windley said.
Likewise, Centene, Aetna and Humana are cutting their benefits that help seniors pay for over-the-counter medications and provide flexible spending cards, which can be used to pay for other health-related expenses, it found.
Although many seniors focus on premiums when reviewing their options, they also need to check the other benefits and features of their Medicare Advantage options, said Mary Beth Donahue, CEO of the Better Medicare Alliance, a funded Medicare Advantage research and advocacy group. by insurers.
“Seniors and those who guide them through this process — caregivers, family and aging organizations — really have to look at the big picture,” she said.
Multiple impacts
The changes come from multiple legislative and regulatory changes to the Medicare Advantage program in recent years, as well as an increase in enrollees’ use of health services.
Critics have long said that Medicare Advantage insurers are being overpaid for the care and services they provide, arguing that many insurers designate some enrollees as sicker than people of similar health in traditional Medicare to get higher out-of-pocket payments. federal government.
In recent years, the Biden administration has made several changes to the Medicare Advantage payment system, particularly in measures that address the health status of enrollees and the quality rating of plans, both of which affect the general payments that insurers receive. Additionally, some Covid-19 pandemic-era provisions that temporarily inflated the quality rating of insurers’ plans have expired.
The result is that, although the Centers for Medicare and Medicaid Services has raised rates, insurers argue that the payments are not enough to cover your medical costs.
Additionally, Congress made major changes to the Medicare drug benefit as part of the Inflation Reduction Act of 2022, which Democrats pushed through both chambers. Among the most notable provisions was a $2,000 annual cap on out-of-pocket prescription drug costs for Medicare enrollees, beginning in January. However, the law requires insurers to pick up more of the costs once enrollees reach the catastrophic coverage phase above the limit.
To help manage their increased liability for the redesigned drug benefit, some insurers are increasing their deductibles and instituting other modifications to their drug coverage.
“You have changes that are impacting revenue in many different ways,” Knable said. “That’s requiring insurers to reconsider what their product portfolios look like.”
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