Is Medicare + Choice too complicated for seniors?

Patricia Neuman, Sc.D. Director, Medicare Policy Project, Kaiser Family Foundation       YES For many seniors, decisions regarding health insurance are already very complicated, and there is a high degree of confusion about their benefits and health insurance choices.   Although Medicare Plus Choice may offer opportunities in the form of more generous benefits or lower costs, it also has risks.   Because the law doesn’t require the new PSOs, PPOs, MSAs, and private fee-for-service plans to offer standard benefits, there is likely to be a wide variety of benefit combinations and premium levels, making apples-to-apples comparisons among Medicare Plus Choice plans virtually impossible. This same type of confusion characterized the Medigap market in the 1980s and led Congress to require standard Medigap benefits.   Beneficiaries will also be hard-pressed to understand their potential financial liability depending on which plan they select. The premium limits and balance-billing protections they have grown accustomed to with Medicare will not apply to services offered by all of these new plans.   Beneficiaries will not be able to predict their financial liability until they get sick and start using the medical system. At that point, it will be too late to switch plans until the annual open enrollment period.   It will be a daunting challenge for beneficiaries to make informed comparisons between plans, given the virtually infinite range of benefit combinations, premiums, and financial requirements.   Beneficiaries generally rely on family members or friends for advice when choosing a plan. Medicare Plus Choice will provide information to help beneficiaries compare the performance and quality of plans, which may be useful for some. But it is questionable whether comparison information will be used by millions of beneficiaries who are in poor health.

Daniel H. Johnson Jr., M.D. Immediate Past President, American Medical Association       NO Choice has a greater potential for substantial advantages to both beneficiaries and the health-care system than it has potential to confuse.   The plan offers a chance to put patients in the driver’s seat, just as they are for other services. This way accountability flows to the patients by a direct link between them and the cost of individual care.   That linkage carries with it the potential for reward. For example, a patient who spends less than the defined contribution may be able to pocket the savings.   Or suppose patients want to have some additional coverage that the government doesn’t want to buy? Medicare Plus Choice will allow them to supplement coverage to suit their individual needs.   Making a good choice from an array of available options does, however, imply the need to learn about those options. This is just what one does when buying a car. The real challenge to the system is to offer the choices in as simple a way as possible, providing all the needed information for an informed choice.   The Federal Employees Health Benefits Program is a model. It offers an array of plans, and people make informed decisions on the basis of information about competing plans. With Medicare Plus Choice, seniors can also be given information to make choices that are just as sound.   Moreover, physicians are available to help patients make their choices. This is an area where the physician can fill a true advocacy role. Who knows more about how the system works than physicians? What better person to turn to for advice? The physician is well positioned to help steer patients.   The key word here is choice, which has pluses and minuses. But when one limits choice, as traditional Medicare does, one limits cost-effectiveness.