Saving Money on Medicare Advantage

Many silver Americans don’t select the best Medicare Advantage plan for them. These plans offer broader benefits at a lower cost to the patient than traditional Medicare, on average. A study recently found that less than 10% of those searching for a Medicare Advantage Plan and 7% of those searching for a Part D prescription drug plan selected the plan that resulted in the lowest costs for their out-of-pocket drug costs. The problems, concluded the researchers, are that older Americans generally have a cognitive decline, which makes decisionmaking less reliable, and the choices have increased. Another factor is most people don’t have experience selecting a medical insurance plan. Their employers also did that for them.

And the cost difference can be substantial. For example, people in one Georgia zip code who take 70 mg tablets of osteoporosis drug Fosamax once daily may have annual expenses ranging from $2,661 to $9,032 — depending on which Medicare Advantage plan they pick, according to a plan finder offered by PlanPrescriber, a broker that sells Advantage plans, and a wholly-owned subsidiary of eHealth Inc.

Having access to more Medicare Advantage plans led to poorer decision-making, and seniors with cognitive decline were even less likely to switch to more cost-effective plans, according to a Harvard Medical School study released in August. Read the study on Health Affairs.org.