Ask The Health Insurance Specialist
QUESTION:
Question from Julie: I’m on a plan that’s rated four and a half stars. I’m looking at the 2023 Medicare and You Handbook I just got in the mail and see many plans get five stars. What does that mean for me? Should I change to a five-star plan?
ANSWER:
No. Changing to a five-star plan for the sake of having that designation alone gets you no better benefits, privileges, or coverage. I don’t like the way stars are awarded because monthly premiums, cost of co-pays, the Maximum out of Pocket (MOOP), and amount and generosity of ancillary benefits like dental, vision, hearing, OTC allowances, etc., are not taken into consideration at all! That’s very misleading for consumers in my opinion. For example, there’s a 2022 five-star plan that has a premium over $70/month, a five-day hospital copay of over $1,000, a MOOP over $5,000, offers no comprehensive dental or OTC allowances, and provides only $150 for eyeglasses. Meanwhile, another 2022 plan in our market costs under $30/month, has a 5-day hospital co-pay under $300, a MOOP that’s $1,000 less, provides more than $2,000 in comprehensive dental, the best OTC and hearing benefits in the market, $250 additional eyeglasses allowance, and a debit card that helps pay as much as $400/year for certain co-pays. It only gets four and a half stars.
According to Xtelligent Healthcare Media, “CMS (Centers for Medicare and Medicaid) assesses a Medicare Advantage plan’s quality of care according to the plan’s performance on a list of quality measures. Each measure falls under one of nine domains. The domains include maintaining health, chronic disease management, member experience, member complaints, and customer service as well as four domains for scoring drug plans. Thus, measures could include annual flu vaccination, diabetes care—eye exam, rating of health care quality, members choosing to leave the plan, reviewing appeals decisions, and more.”
It’s important to note, “As part of pandemic relief, CMS relaxed how it calculated Medicare Advantage star ratings for 2021 and 2022. The result was a record number of insurers gaining higher scores on the program’s five-point scale, and a corresponding increase in federal spending on bonuses.” This is according to Modern Healthcare, which I subscribe to and rely heavily on for breaking news and trends in the healthcare and health insurance industries. They go on to explain that “Medicare Advantage carriers are prepping for the most difficult star ratings season since before the pandemic. The CMS is set to resume the standard process for assessing quality, which it relaxed in response to the public health crisis (COVID), and to more heavily weigh consumer satisfaction when determining health plan performance. These looming changes threaten the big bonuses on which insurers came to rely on to differentiate their offerings in the crowded market for private Medicare plans through richer benefits and lower premiums.” To summarize, many plans that were awarded five stars would not have earned them if it weren’t for the fact CMS stopped taking member complaints and satisfaction into account.
There are two things I expect to happen due to the more stringent star rating system; There will be fewer, if any, five-star plans when those ratings come out in 2023 or 2024. Another ramification that I’m extremely concerned about is plans which fall under four stars will lose the five percent bonus they’ve been receiving. This extra money companies have been paid is the reason more ancillary benefits as well as lower overall premiums and co-pays have been offered on their best plans. If they lose that bonus and it has a substantial impact on profit margins which I would expect, we may see the outstanding value Advantage Plans have offered in the last couple of years and into 2023, be reduced in 2024, 2025, and beyond. This could mean less generous dental, vision, hearing, and OTC allowances and/or higher co-pays and premiums. I’m hopeful that a moratorium on the reduced reimbursements will be announced so there isn’t any shock to the system. By January 1st, 2023, there will be more than 30 million Americans who rely on Advantage Plans due to the lower premiums and extra benefits they provide.
You can make a difference in star ratings because part of what goes into them is the number of members who get their preventative services such as mammograms, prostate screenings, flu and pneumonia vaccines, and others. And those calls constantly asking you to let a nurse come to the house for a health assessment? The percentage of members who participate is also important to star ratings. Make sure you receive all your preventative services and schedule your home health assessment! Not only will it help your plan keep its 4 plus star rating and great benefits, but it also can contribute to good health. I actually had a client tell me a serious medical issue was diagnosed by a nurse during his home visit that may have saved his life.
A reminder that the Medicare Annual Election Period (AEP) starts on October 15th and runs through December 7th. We highly recommend anyone who didn’t originally get their Advantage, Supplement, or Part D prescription plan from The Health Insurance Store give us a call to ensure you’re not overpaying in premiums or co-pays and getting the best possible benefits for your money. I estimate that 50% of those on Medicare are not on a competitive plan! Consultations are always no cost and can be done in person, over the phone, or via the internet. Feel free to reach out directly as well via email at aaron@ getyourbestplan.com. Keep the great questions coming and thanks for reading. Go Steelers!