These days you hear a lot of politicians talking about “saving Medicare” and offering seniors additional health care benefits, such as free prescription medicine. But take a look at what the politicians are doing instead of what they are saying. Then you’ll see that many of these same politicians are reducing seniors’ health care options and increasing costs.
This year Medicare reimbursements to nursing homes, especially for physical therapy, were reduced. As a result, many nursing homes are in financial difficulty or reducing services. Most now won’t admit certain types of patients, because it is unprofitable to care for them under Medicare. Other patients are discharged much earlier than they would have been last year and before their course of therapy is completed.
HMOs also have had their reimbursements reduced and were denied permission to increase their charges to members. The government recently announced that 327,000 Medicare beneficiaries have to find new health care because their HMOs no longer will participate in Medicare. Other seniors in HMOs face benefit reductions and copayment increases.
And, until a recent court decision, most doctors could not let you pay for services if you are enrolled in Medicare. Some seniors preferred from time to time to pay for care, because they got appointments and treatment quicker, and their doctors didn’t have to negotiate with Medicare over whether or not a certain treatment would be covered. The government wants to end that.
There’s talk now of giving seniors “free” prescription medication. Don’t fall for that one. According to surveys, about 70% of seniors already have prescription drug coverage. Only 2% say they have to choose between medication and other essentials. But if prescription drug coverage is added, Medicare premiums will climb much higher than already scheduled. In addition, the government will control reimbursement prices. That will result in shortages of prescription drugs similar to what seniors have experienced in other aspects of medical care.
What is a senior to do?
Regularly monitor your health care options, so you’ll know what else is available whenever a change occurs. It is a good idea to keep up with the basic options so you won’t have to start from scratch to find new coverage in 60 days or so. I help you with that in our monthly visits.
When an HMO drops out of Medicare, look for another HMO in your area. In a metropolitan area you are likely to have other options. But keep in mind that a recent government study concluded that HMOs still are overpaid. Reimbursements to HMOs are likely to get reduced again, causing more HMOs to drop out or cut benefits. (These are ironic developments. The 1993 Clinton health care proposal and the more recent Medicare overhaul were designed to move more seniors into managed care.)
You can stick with (or go back to) regular Medicare and a “medigap,” or Medicare supplement, policy. (But some insurers have been raising their premiums at rates from 18% to 40%.) After picking the type of coverage you want, carefully shop for an insurer. Don’t consider only the current premiums. Ask about the history of premium increases. For tips on selecting the right medigap policy for you, see my February 1999 issue or the web site.
Professional associations also might offer group coverage. Even if you dropped out of your professional or trade association at retirement, contact them again and see if they have health care policies available for which you qualify.
For some seniors, the best move is to go back to work at a job that includes group health care. Then, after you leave the job, you might qualify under a law called COBRA to continue receiving the group coverage by paying a rate equal to 102% of the employer’s cost. You can do this for up to 18 months after leaving the job. Some time on the job plus 18 months of COBRA continuation coverage might get you to a point where the health care situation has settled down.
It’s been a bumpy road for senior health care over the last few years. It is likely to get bumpier, as the experts say Medicare is 10 years or less from becoming insolvent and next year is an election year.
Your basic options remain the same. If you aren’t covered by an employer or union retiree health plan, you can choose some form of managed care that participates in Medicare. Or you can join regular Medicare. In the latter case, you can pay for the items Medicaid doesn’t cover, or you can get a Medicare supplement policy to cover some or all of the gaps. Or you can go back to work with an employer who’ll cover you under a group health plan. A final option is to check out any trade association you qualify for.
Most importantly, Stay on top of the changes in this area so you’ll always know the best option for you. Get used to the idea that your health care coverage is likely to change regularly.