When the yearly open enrollment period arrives, Medicare users have the option to select a healthcare plan. However, millions of seniors may lose access to their Medicare Advantage plans this year because several major insurers are discontinuing them.
This change is largely due to the Inflation Reduction Act, which lowered government reimbursement rates, making it harder for insurance companies to keep offering these plans.
What Is Medicare Advantage?
Medicare Advantage, also known as Part C, is a private version of Medicare. It’s managed by private insurance companies but still overseen by the Social Security Administration.
Medicare Advantage often includes benefits like dental and vision care, which aren’t covered by basic Medicare. It can be a cost-effective choice for seniors who want extra coverage without paying out-of-pocket for additional insurance.
Why Are Medicare Advantage Plans Being Discontinued?
The Inflation Reduction Act aimed to make healthcare costs more manageable, but it also lowered the reimbursement rates for insurers. As a result, many insurance companies can no longer afford to maintain Medicare Advantage plans.
When costs rise, but reimbursement doesn’t, it becomes hard for insurers to operate without losing money. Kevin Thompson, CEO of 9i Capital Group, explained that many companies are backing out of Medicare Advantage because they’re no longer profitable.
Major Insurance Companies Leaving Medicare Advantage
Several big insurers are stepping away from Medicare Advantage plans, which will impact seniors in various states:
- Humana: Humana has reduced its Medicare Advantage options, affecting 560,000 members in 13 different markets. The company made this decision after a drop in earnings, partly due to new rules on prescription drug prices.
- HealthPartners: Partnering with UnitedHealthcare, HealthPartners announced it would no longer offer certain Medicare Advantage plans. This change will affect about 30,000 members who may have to find new coverage.
- Centene Corp: Centene is exiting the Medicare Advantage market in several states, impacting around 40,000 members. The company’s CFO noted that they aim to focus on areas that offer better long-term stability.
Additionally, Vermont’s UVM Health Network is cutting its MVP Medicare Advantage plan, impacting around 25,000 seniors in the state.
What This Means for Seniors
Losing access to Medicare Advantage can be challenging for seniors who rely on these plans for affordable dental, vision, and other medical services. Michael Ryan, an expert from michaelryanmoney.
com, emphasized that these changes may mean higher out-of-pocket costs for those impacted. Seniors using Medicare Advantage for regular health services may now need to seek alternative coverage.
While these changes can be inconvenient, Chris Fong, CEO of Smile Insurance Group, suggests it may open new options for some seniors. Those who lose their Medicare Advantage plan could qualify for Medicare Supplement plans without needing health screenings. This can be especially helpful for seniors with existing health conditions.
Important Dates
If your Medicare Advantage plan is ending, it will remain active until December 31. After that, if you haven’t chosen a new plan, you’ll automatically switch to standard Medicare, which offers fewer benefits. Open enrollment began on October 15 and will end on December 7.
With Medicare Advantage plans ending for many seniors, it’s important to understand your options. Although these changes are a response to the Inflation Reduction Act, they have left insurance companies struggling to cover rising costs.
For affected seniors, now is the time to explore new plans and determine which coverage works best. For some, Medicare Supplement plans may offer a new path forward, especially for those needing coverage without health screening barriers.
Make sure to review your plan options before the December 7 enrollment deadline to ensure your healthcare needs are covered.
1. Why is my Medicare Advantage plan ending?
Medicare Advantage plans are ending for many because insurers can no longer cover costs after the Inflation Reduction Act reduced their reimbursement rates.
2. How many people will be affected by these changes?
Over 600,000 seniors are expected to lose access to their current Medicare Advantage plans.
3. What happens if I don’t choose a new plan by December 31?
If you don’t select a new plan, you’ll automatically switch to standard Medicare, which provides fewer benefits than Medicare Advantage.
4. Can I switch to a different type of Medicare plan?
Yes, you may qualify for a Medicare Supplement plan, which provides additional coverage, though you may need to go through a health screening.
5. How can I find out if my plan is ending?
Contact your insurance provider or check the Medicare website to see if your Medicare Advantage plan is one of those being discontinued.
