CHA Blog

• 05Jan

  Medicare = Big Bucks for Insurers ~ Can They Afford to Leave the Market?

  Medicare Advantage No Comments

  When Congress debated cutting payments to Medicare Advantage plan sponsors, what did the sponsors threaten?  To get out of the Medicare market.  Yet can they really afford not to be in the Medicare market, especially given that 3 of the top Fortune 500 companies in 2011 were WellCare Health Plans, Humana, and Centene, all of which are health insurers with a high proportion of Medicare Advantage enrollees? WellCare’s share price has nearly doubled while Humana and Centene are up about 50%.

  Here’s an article about profits these sponsors are earning.

  If you have time, also watch the video with Dr. Donald Berwick on “How to heal health care” at the end of the article.

  Tags: health care, Medicare Advantage, Medicare Advantage plans, profits

• 07Nov

  Beneficiaries Gain a New Right to Switch to a 5-Star Health Plan Starting 12/8/11

  Medicare Advantage, Prescription drugs No Comments

  As a way to reward Medicare Advantage (MA) and Part D plans that receive high performance ratings by the Centers for Medicare and Medicaid Services (CMS), and to guide beneficiaries toward such plans, there will be a new Special Election Period (SEP) allowing Medicare beneficiaries to enroll in MA and Part D plans that receive an overall 5-star rating by CMS’s Plan Performance Rating system. This right will start on December 8, 2011 and ends November 30, 2012.  The 5-Star SEP can only be exercised once per year.  Plan ratings for 2012 are available now on Medicare.gov’s Plan Finder Tool.

  Very few plans in 2011 achieved 5-star status. In California, no stand-alone Part D plans achieved this status. Kaiser’s Senior Advantage HMO plan in several counties is the only MA plan that received a 5-star rating.

  Note that using the 5-Star SEP does not guarantee Part D coverage. If a beneficiary in either an MA-PD plan or a PDP chooses to enroll in an MA-only plan with a 5-star overall rating, that beneficiary would lose Part D coverage and must wait for a subsequent enrollment period to obtain Part D coverage (such as the Annual Election Period from Oct 15 – Dec 7 each year). Late enrollment penalties might also apply.

  Here’s a summary of the star ratings for the PDPs in California:

  Star rating	How many PDPs?	Comments
  4	5	Dominated by Medco and Blue Shield.  Two of the Blue Shield PDPs are new – please note that the ratings are based on the sponsor and not the individual plan.
  3.5	2	Both WellCare.
  3	12
  2.5	14	Two of them are benchmark plans (Envision Rx Plus Silver and Aetna CVS/pharmacy).

• 17Oct

  Medicare’s Fall Open Enrollment Has Begun ~ Oct 15 – Dec 7

  Medicare Advantage, Prescription drugs No Comments

  Medicare’s Fall Open Enrollment, officially known as the Annual Enrollment Period (AEP) starts and ends earlier now. From October 15 – December 7, beneficiaries can change their Medicare health plan and Part D coverage and/or return to Original Medicare. Coverage changes become effective January 1, 2012.

  Learn more about the AEP and other enrollment periods. Beneficiaries can also contact their local Health Insurance Counseling and Advocacy Program (HICAP) for free counseling and information on their health care options in their area.

• 11Oct

  California Beneficiaries Hit Hard by Medicare Advantage Plan Pull-outs

  Medicare Advantage No Comments

  Almost 151,000 beneficiaries in California are in a Medicare Advantage plan that is pulling out of Medicare in 2012. This means these plans are not renewing their Medicare contracts, their plans are terminating by the end of the year, and beneficiaries enrolled in these plans need to choose a new coverage option for 2012. With a total of 301,912 beneficiaries nationwide affected by such terminations, 50% are in California.  Anthem Blue Cross is the reason for this high percentage of affected benefciaries. They decided not to renew two regional PPO plans, the Freedom Blue plans, which have 113,709 enrollees or 75% of affected beneficiaries statewide.

  Anthem Blue’s explanation for not renewing these popular regional PPO plans is “to ensure that we manage our operational and financial stability so that we can continue to support our member’s needs today and in the future.”  Other Medicare Advantage plans that are not renewing account for the remaining 25% of affected beneficiaries.  Some of these plans may be terminating because of low enrollment.

  What can beneficiaries in this situation do?

  Beneficiaries who are affected by these non-renewals should have received a notice from their plan on or before Oct 2nd informing them about their upcoming termination and that they have a Special Election Period (SEP) to join another plan.  They also have the option to return to Original Medicare, enroll in a stand-alone Part D prescription drug plan, and use a Guaranteed Issue right to purchase a Medigap policy without a health screening, a form of Medicare supplemental insurance. See When MA Plans Terminate for more info.

  Beneficiaries who want to use their SEP to join another Medicare health plan may or may not have many plan options to choose from depending on which county they live in. Generally, beneficiaries in southern California have many Medicare Advantage plan options, especially HMOs, whereas beneficiaries in northern California have fewer Medicare Advantage plan options.  In urban areas in northern California, some counties have a few HMO plans, and in rural areas, some counties have private fee-for-service (PFFS) plans only.

  Although there are no counties without any Medicare Advantage plan options, a few counties have options that are not affordable or suitable.  For example, four counties – Marin, Nevada, Sutter and Yuba – each have only one Medicare Advantage plan in 2012, and the premiums of these plans range from $79.60 to $99, much higher than the current Freedom Blue PPO which has a $0 premium.  Another example is Santa Cruz county which will have two Medicare Advantage plans next year, but the premiums are high: one HMO with prescription drug coverage at $192 and one HMO without prescription drug coverage at $89. Beneficiaries who want a Medicare Advantage plan and prescription drug coverage have to choose the HMO with prescription drug coverage because of a rule that a beneficiary cannot combine an HMO with a stand-alone Part D plan.

  Three counties – San Benito, Tehema and Tuolumne – illustrate another problem. Each county has only a private fee-for-service plan; they have no local HMO or PPO plans.  Many doctors do not accept the payment terms and conditions of these private fee-for-service plans.  Thus a private fee-for-service plan enrollee may have coverage but no access to his or her doctor.

  Sponsors of plans that are not renewing are trying to get affected beneficiaries to enroll in the sponsor’s other plans, such as other MA plans or stand-alone Part D plans.  Anthem Blue, for instance, is offering local PPO plans in 13 counties and three Part D plans statewide.  Insurance companies that sell Medigap policies, including some sponsors of Medicare Advantage plans, are also targeting affected beneficiaries since these beneficiaries have a guaranteed issue right to buy a Medigap policy.  Beneficiaries should look at all their options and not just the plans offered by one sponsor.  To find out about their options, beneficiaries’ best bet is to contact their local HICAP (Health Insurance Counseling & Advocacy Program) at 1-800-434-0222.  Local HICAPs provide objective Medicare benefits counseling at no cost, such as helping a beneficiary compare the difference between Medicare Advantage plans and Medigap, or finding and comparing Part D prescription drug plans.

  All Medicare beneficiaries can make changes involving a Medicare Advantage or Part D plan during the Annual Election Period, also called Fall Open Enrollment, which is earlier this year, from October 15 to December 7.  A beneficiary who is in a non-renewing plan also has a Special Election Period from Dec 8 to Feb 29, which gives them more time to make a change.

  See our website for more information on the AEP and your rights if your Medicare health plan is terminating coverage.

• 16Aug

  CMS Removes Sanction from Universal American – Today’s Options Plans

  Medicare Advantage 1 Comment

  The Centers for Medicare and Medicaid Services (CMS) removed its marketing and enrollment sanctions on Universal American on 8/5/2011.  Universal American offers the Today’s Options plans in California.  As of now, Quality Health Plan (QHP), a Tampa, Florida based insurer is the only organization that’s still under sanction.

  With its sanctions removed, Universal is permitted to market and advertise their 2011 Medicare Part C and D products. They can also accept enrollments from beneficiaries with valid election periods, with the earliest effective enrollment date being 9/1/2011.

  Universal had been under sanction for marketing violations by their agents and brokers, including prohibited marketing practices, resulting in delays in access to care.

  CMS is reasonably assured that the issues that gave rise to the company’s sanction are not likely to reoccur. However, if they do resurface, CMS will consider additional compliance and enforcement actions. CMS will also continue to closely monitor Universal American’s performance.

  If you hear of any significant issues associated with Universal American, or any other of our Medicare Advantage or Prescription Drug Plans, please let CMS know by contacting your CMS Regional Office.

• 07Dec

  Back-Billing Problems Solved for 18,000+ Beneficiaries in Secure Horizons Plans

  Medicare Advantage No Comments

  Beneficiaries enrolled in AARP Medicare Complete, a Medicare Advantage HMO sponsored by Secure Horizon have reported being back-billed for past months and/or years of premiums they did not know they owed. This has caused some panic and much distress for beneficiaries receiving bills for hundreds, sometimes thousands of dollars of premiums and no extra money with which to pay. California Health Advocates alerted the Centers for Medicare and Medicaid (CMS) about the problem, and CMS and United (Secure Horizons’ parent company) have recently come to a resolution. Below is a summary of the 2 kinds of back-billing problems, United’s actions and terms of resolution for each kind of problem, and a discussion regarding some of our ongoing concerns.

  Two Kinds of Back Billing Problems

  The 2 kinds of back-billing problems had to do with enrollees with dental benefits, and enrollees dually eligible for both Medicare and Medi-Cal.

  Dental benefits – Some Secure Horizons enrollees signed up to receive an optional dental benefit and to have their premiums deducted from their Social Security checks.  Yet, as it turns out, Secure Horizons was not set up to deduct the additional dental benefit premiums from their Social Security checks, and therefore none of their premiums were paid. Secure Horizons did not bill members for the dental premium until recently, back-billing for several months’ or years’ premium. United (Secure Horizons’ parent company) agreed to write off the premiums for the months when members were not billed.  These cases were closed a few weeks ago.

  Beneficiaries on Medicare and Medi-Cal – Many of these cases were first reported to us from the Health Insurance Counseling and Advocacy Program (HICAP), and CHA in turn inquired of CMS.  Some of the cases involved beneficiaries who were in a Secure Horizons plan even before 2006 when Medi-Cal paid the monthly premium.  These beneficiaries did not receive an invoice or coupon book until recently.  The invoices ranged from $990 to almost $3,000.

  More than 18,000 beneficiaries were affected, yet it is still unclear whether all affected beneficiaries were in California. As United investigated the problem, they found that members fell into 4 categories depending on different dates, and United’s action was tailored accordingly.  Common to all cases, United agreed to write off balances during periods when United failed to bill or billed incorrect amounts.  However, for periods when United billed correctly, United expects to collect these amounts going forward.  If members cannot pay several months’ premium (for periods when United billed correctly and in a timely manner), United will offer payment plans.

  For all categories, United developed appropriate communications to members, which were submitted for CMS approval and were sent to affected members in late November. According to CMS, they have also re-trained their staff to properly address this issue.  If United members have complaints related to this back-billing problem, they should call the plan and also 1-800-Medicare to log the complaint.

  Additional Issues of Concern

  Some issues we continue to be concerned about include:

  1.     For some beneficiaries, when they called Secure Horizons about the lump sum invoice, the plan representative negotiated and reduced the amount due.  If a beneficiary paid the reduced amount, he or she should get a refund (or credit) if what he/she paid was for a period that United has agreed to write off. We are concerned about if, how and when they will receive this refund and whether CMS is monitoring this process.

  2.     Beneficiaries with Medicare and Medi-Cal (also known as “dual eligibles”) may not know that they have a Special Election Period (SEP) to disenroll from their Secure Horizons plan.  We communicated our concern to CMS and they responded that they would ask United inform these beneficiaries of their SEP rights.

  3.     Some dual eligibles were enrolled in their Secure Horizons plan before 2006, when Medi-Cal paid the premium.  When the policy changed and Medi-Cal no longer paid the premium, these beneficiaries may not have been notified that they would now be responsible for their MA plan premium.

  4.     A related issue is dually eligible beneficiaries who were told by sales reps that they would not have to pay a premium because they have Medi-Cal.  As mentioned above, Medi-Cal does not pay the premium of Medicare Advantage plans for beneficiaries who are dually eligible for Medicare and Medi-Cal.  If a beneficiary cannot afford  the premium, they can disenroll or change to a plan with a lower premium.  They have an SEP to disenroll or change plans.

  If you hear of any additional cases regarding this back-billing issue, please contact your local HICAP at 1-800-434-0222.

  See Special Election Periods for Parts C and D for more information on SEPs.

• 24Nov

  CMS Clarifies When ESRD Beneficiaries Can Enroll in Other MA Plans

  Medicare Advantage, Medicare and disabilities No Comments

  People with end stage renal disease (ESRD) are prohibited from enrolling in Medicare Advantage plans. If, however, they are already enrolled in one and then later develop ESRD, they can stay in their plan; the MA plan cannot drop their coverage.

  While these are the general rules, there are a couple of exceptions to this prohibition of joining MA plans, as outlined in CMS’ Medicare Managed Care Manual. One such exception, revised and effective as of November 19, 2010 (Chapter 2, Section 20.2.2), is that a Medicare beneficiary with ESRD who is already enrolled in an MA plan may join any of the other MA plans within the same parent MA organization during certain enrollment periods.  One such period is the Annual Election Period (AEP) which is from November 15 – December 31 in 2010 and from October 15 – December 7 starting in 2011.

  In the past, CMS limited this exception to apply only to MA plans under the same organization, not the same parent organization. For example, a beneficiary with ESRD who was enrolled in a Secure Horizons MA plan could only switch to another Secure Horizons MA plan if one was available. Now, however, a beneficiary meeting 3 conditions can switch to any MA plan under the parent organization, United. This includes switching from an HMO to a PPO or PFFS plan and vice versa. In many cases, this revision gives ESRD beneficiaries more MA plans to choose from if they’d like to switch plans.

  The 3 conditions determining whether a beneficiary can switch MA plans within the same parent company include:

  • The new MA plan must operate in the same state as the beneficiary’s previous MA plan,
  • The beneficiary meets all the other requirements for enrollment in that MA plan (i.e. has both Medicare Parts A and B), and
  • The effective date of enrollment is prospective from the date of CMS’ memorandum (11.19.10).

  For questions about this exception, please contact Jim Canavan at (410) 786-5223 or James.Canavan@cms.hhs.gov.

  For more information on ESRD and Medicare, see our fact sheet: Medicare and People with End Stage Renal Disease (ESRD).

• 22Sep

  Medicare Advantage Premiums Will Decrease in 2011

  Health Care Reform, Medicare Advantage No Comments

  The Obama administration announced that average premiums paid by individuals for private Medicare Advantage plans, which insure about 1/4 of all beneficiaries, will decline slightly next year, even as insurers provide additional benefits required by the new health care law.

  This contrasts with commercial insurance premiums which may increase 10% to 25% or more for many people younger than 65 and small businesses. Insurers say that much of the increases is attributable to requirements of the new law.

  Many of the law’s new requirements take effect this week. See Health Care Reform 6-Month Status Report, a publication by Health Access that documents how the new health care law is affecting Californians and examines major provisions effective on 9/23.

  The announcement of MA plans’ cost decrease came as a bit of a surprise. Many Congress people and health policy experts predicted an increase similar to that seen with commercial insurance for younger populations, especially since, as a way to address the past overpayment to MA plans, 2011 plan payments rates will basically stay at 2010 levels.

  Yet Medicare officials said they were able to hold down premiums and copayments by negotiating with insurers, which sponsor the Medicare Advantage plans. The health care reform law, signed by President Obama in March, gave officials new power to negotiate and to reject bids, as they did in several cases. In fact, in reviewing bids, Medicare officials identified 300 private plans that unfairly proposed to increase out-of-pocket expenses for beneficiaries while increasing their own profit margins. CMS officials rejected these bids, telling them they must do better in order to be approved. After negotiations, most plans improved their benefits by an average of $13 per member per month.

  Medicare Advantage premiums will on average be 1% lower in 2011 than today. Premiums for a particular plan in a particular county may increase next year, yet beneficiaries will most likely be able to find other plans offering a better deal. Medicare Advantage plans also project that enrollment will increase by 5% in 2011. Plans can begin marketing to beneficiaries on Oct. 1 for coverage that starts Jan. 1.

  John K. Gorman, a former Medicare official who is now a consultant with clients in the insurance industry commented on the price decrease saying that: “Today’s announcement shows that there is a new sheriff in town. Medicare officials were very specific and very forceful. Insurers succumbed to the government’s demands and stayed in the Medicare market because they have become much more dependent on Medicare business.”

  Payment rates for subsequent years will also be subject to tighter constraints. The cuts made in the health care reform law are expected to save $136 billion over 10 years.

  See Medicare Advantage for more information on MA plans.

  For info on health care reform and Medicare, see our article, What Does Health Care Reform Mean for Medicare Beneficiaries? Summary of Key Provisions.

  This article was edited in part from a NY Times article, September 21, 2010.

• 24Aug

  Some MA Plans Are Back-Billing Enrollees for Past Premiums

  Medicare Advantage, Medicare billing and claims No Comments

  Several Health Insurance Counseling and Advocacy Programs (HICAP) have reported on a few Medicare Advantage plans that are back-billing their enrollees for past monthly premiums. Many of these plans did not bill beneficiaries for months or even years at a time and are now sending them a bill for a large lump sum. Beneficiaries receiving such bills are rightly distressed and have contacted their local HICAP offices for help.

  If you are experiencing this problem or have clients who are: 1) file a grievance with the MA plan; and 2) file a complaint with CMS Region 9 Office and ask that you or your client be relieved of all payment responsibility and ask for a Special Election Period (SEP) to change to another MA plan.

  CMS Region 9 Contact: Ayanna Busby-Jackson

  Her email and phone number are: ayanna.busby-jackson@cms.hhs.gov; 415-744-3615.

  We, along with other advocacy organizations, are collecting information on such cases to report to the Centers for Medicare and Medicaid Services (CMS). With enough cases we can strongly recommend CMS file sanctions against these plans and/or impact litigation.

  Please email us with a summary of such cases.

  Tags: beneficiaries, billing, health insurance, Medicare Advantage plans, premiums

• 20Jul

  Insurance Agent Prohibited from Selling Medicare Advantage Plans

  Medicare Advantage, Medicare fraud No Comments

  The California Department of Managed Health Care (DMHC) has issued an order barring a Folsom health insurance agent from selling Medicare Advantage plans, due to unscrupulous and deceptive practices against nearly a dozen local senior citizens. The agent, Nadia King, cancelled the Medicare coverage of elderly consumers without their consent or knowledge, and then enrolled them in private Medicare Advantage plans she represented, causing some to unknowingly incur unexpected medical bills.

  Deceptive marketing of Medicare Advantage products to senior citizens is a growing problem in California and across the nation. California Health Advocates started receiving complaints from beneficiaries about deceptive marketing of Medicare Advantage products over 3 years ago, and has been working with both DMHC and California Department of Insurance (CDI) in finding resolution and ways for the 2 departments to work together in stopping such practices. California Department of Insurance has the power to revoke an agent’s license (as agents are licensed by CDI), and DMHC, according to state law, has the power to bar an agent from selling certain products if it is determined that a solicitor makes misrepresentations to consumers or acts in a manner that may expose them to substantial risk.

  In this case of Naida King, the DMHC has indefinitely barred her from operating as a solicitor of Medicare Advantage plans to individuals eligible for Medicare. The order alleges that King solicited unsuspecting Medicare enrollees, using deceptive sales tactics to enroll them into the particular Medicare Advantage plans that she was selling.

  Eleven local victims are identified in the order. In most cases, unsolicited contacts with elderly Medicare recipients either in their homes, by telephone, or some other means, resulted in Ms. King enrolling the victims in various Medicare Advantage plans, often without their knowledge or consent. Some of these victims experienced delays in medical treatment as a result of the unwanted change to their health coverage, or unexpected out-of-pocket charges, of up to $6,000 in one case.

  DMHC, CDI, CHA and our Senior Medicare Patrol (SMP) program are collaborating in ongoing efforts to protect consumers from health care fraud and fraud insurance products. Both CDI and DMHC are actively investigating Medicare Advantage marketing abuse cases, CDI revoking some insurance licenses and DMHC issuing sanctions against insurance agents engaged in fraudulent activities. In addition, the DMHC has also been ordering unlicensed and fraudulent discount health plans to cease operation or seek licensure to ensure that the plans are selling a legitimate product, and has shut down a phony labor union health coverage scheme that put hundreds of consumers at risk of losing coverage.

  Consumers and advocates with questions about health care fraud can contact our SMP program at 714-560-0309. People can also contact the DMHC Help Center for assistance in identifying legitimate health products at 888-466-2219, and CDI’s consumer hotline at 800-927-4357 for reporting insurance agent misconduct.

  Also, below are a few reminders on how to avoid deceptive health care marketing schemes:

  • Do not give personal information, such as Social Security numbers, bank account numbers, or credit card information.
  • Be wary of unsolicited calls or visits at home, or an approach by someone at your doctor’s office, pharmacy or hospital.
  • Do not take calls from someone claiming to be from Social Security or Medicare. Legitimate representatives from these programs will not call or come to your home unless you have contacted them to request it.
  • Read and understand the health plan information.
  • Consult family and friends before purchasing any health plan.

  For general information on Medicare fraud and abuse, see our section Medicare Fraud.

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