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A new Kaiser Family Foundation (KFF) analysis examines the extent to which large employers that offer retiree health benefits are turning to Medicare Advantage (MA), the reasons why they are making this shift, and the implications for retirees and federal spending.
Among the key findings:
This shift has important implications for beneficiaries and the Medicare program. Unlike OM enrollees, people with MA are subject to narrow provider networks and utilization management tools that may limit or delay access to Medicare-covered services. Funneling more Medicare-eligible retirees into MA will likely drive up costs, as Medicare pays more for MA enrollees (including in group plans), on average, than for a similar beneficiary in OM.
As KFF notes, there are also critical transparency issues. “…the rising number of Medicare Advantage enrollees in group plans highlights the lack of transparency about these plans, including information about which employers are offering Medicare Advantage, and makes it difficult to assess the extent to which Medicare overpayments may be offsetting employers’ liability for retiree health coverage, the scope of coverage under group plans, such as provider networks for Medicare-covered and other benefits, the scope of extra benefits, and premium and cost-sharing requirements.”
The Medicare Rights Center continues to urge commonsense reforms to ensure all people with Medicare have coverage that works for them. This includes deterring overpayments; equalizing Medicare benefits; realigning payment incentives; and easing access to care, including by limiting prior authorization, preventing erroneous denials, and streamlining appeals processes. We also urge improvements to simplify Medicare enrollment, such as standardizing plan options, passing BENES 2.0, and expanding access to Medigap.
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