Have Medicare? Don't shop insurance exchange

From the New York Times

WASHINGTON — Medicare beneficiaries can sign up for private health plans starting Tuesday, but federal officials fear that many of them, out of confusion, might go to the new federal insurance exchange.

In fact, people with Medicare generally cannot buy insurance through the exchange. Policies sold there duplicate many benefits provided by Medicare, and it is illegal for insurance companies, agents and brokers to sell such polices to people known to have Medicare, federal officials said Monday.

More than one-fourth of the 52 million Medicare beneficiaries are in private managed care plans known as Medicare Advantage, and the Obama administration is giving these insurance companies a fresh infusion of federal money.

Earlier this year, the administration reversed a proposed cut in federal payments to Medicare Advantage plans and decided — despite the recommendations of career government officials — to increase payments to them in 2014. The decision followed extensive lobbying by the insurance industry.

Medicare actuaries estimate that as a result payments to insurers will rise by $6.5 billion in 2014 and by $60 billion over 10 years. Those numbers include additional premiums that will be paid by Medicare beneficiaries, roughly $1.5 billion next year and $14 billion over 10 years.

Joan M. Jenness, 81, a retired schoolteacher who lives in Bridgton, Me., said she had been watching the rollout of the federal exchange “with fascination, muted horror and sympathy” for people struggling to use it.

“I am very glad that I do not have to worry about the exchange and health plans offered on the exchange, with their limited networks of doctors and hospitals,” said Ms. Jenness, who added that her experience with Medicare had been “very satisfactory.”

In a bulletin for older Americans, the Obama administration emphasized that people on Medicare did not have to worry about the exchanges, or marketplaces, where millions of Americans have been trying to shop for private insurance since Oct. 1.

The Medicare handbook, sent to beneficiaries last month, drove home the point, saying, “Medicare isn’t part of the marketplace.”

During the annual open enrollment period, which begins Tuesday, Medicare beneficiaries can sign up for Medicare Advantage plans offered by insurers like UnitedHealth and Humana and by Blue Cross and Blue Shield companies.

A recent government notice to Medicare beneficiaries says: “The health insurance marketplace is designed to help people who don’t have any health insurance. You have health insurance through Medicare. The marketplace won’t have any effect on your Medicare coverage.”

The open enrollment period for Medicare runs to Dec. 7 and overlaps with the open enrollment period for the exchanges, which is from Oct. 1 through March 31.

To minimize confusion, the administration said that people on Medicare “should make sure that they are reviewing Medicare plans and not marketplace options.”

The potential for confusion is substantial. A number of insurers have used the terms “gold,” “silver” or “platinum” for products sold to Medicare beneficiaries, and similar terms are now used in the exchange.

Humana Gold Plus is the name of a health maintenance organization for Medicare beneficiaries. Coventry Health Care, acquired this year by Aetna, offers Medicare H.M.O.’s known as Advantra Silver and Gold Advantage.

Anne M. Armao, a vice president of SummaCare, in Akron, Ohio, said the company had changed the names of its silver and gold Medicare Advantage plans to sapphire and emerald to avoid confusion with products offered on the exchange to people under 65.

In newspaper advertisements intended for Medicare beneficiaries last week, Bruce D. Broussard, the chief executive of Humana, said: “We want to reassure you that these changes won’t affect how you enroll in Medicare. So you can relax — there’s no need to worry.”

Humana has reason to be concerned about public confusion: it derives more than 60 percent of its revenue — $25 billion of $39 billion last year — from Medicare Advantage.

Judith A. Stein, the executive director of the nonprofit Center for Medicare Advocacy, said she had received many calls from beneficiaries who believed incorrectly that “because of Obamacare they have to make some change or have to go to the new marketplace."

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