Council Post: Why Are Medicare Advantage Plans So Heavily Advertised?

It's "Medicare Advantage" harassment season, so soon? It happens nearly all year 'round! "Group health" solutions based on statistics do not work well for everyone.

According to an M.D. I went to several years ago - the insurance companies overestimate the problems healthy people will have . . . with projections based on statistical stereotypes, rather than health of individuals. If the predicted use of funds allotted are not used, by any individual, than the funds can be used for other folks. So the over estimation of predicted problems for everyone pays off for the insurance companies - to cover extra costs for the very ill - unless one is sensitive to gloom and doom predictions or expectations by others about oneself!

"Medicare Advantage plans can be changed during MA OEP (Jan. 1 – March 31), Special Enrollment Periods (SEP) ( a qualifying life event), the Initial Enrollment Period(?) and the fall OEP/AEP."

"How the Medicare Advantage Open Enrollment Period is different from the Medicare Annual Election Period
The AEP is different in several ways. First, it occurs in the fall, between Oct. 15 and Dec. 7, for coverage beginning Jan. 1. Second, anyone eligible for Medicare can participate. Third, you can make as many changes to your plan and coverage as you wish before Dec. 7." (Sounds like the lottery . . . you gamble you lose, and everything is a gamble. mg)

Take away I got from the article:

"Advantage plans are heavily advertised because of how they are funded. These plans' premiums are low or nonexistent because Medicare pays the carrier whenever someone enrolls. It benefits insurance companies to encourage enrollment in Advantage plans because of the money they receive from Medicare."

"Medicare Advantage Funding

Looking at how Advantage plans are funded gives some insight into why we see so many of the aforementioned advertisements. The Centers for Medicare & Medicaid Services (CMS) is the principal source of funding for Advantage plans, paying insurance companies for each beneficiary's expected healthcare costs. Thus, the more people who enroll in Advantage plans, the more funds Medicare gives insurance companies offering these plans. In exchange, the Advantage plans, rather than Medicare, pay for enrollees' care. Critics have raised concerns that CMS steers enrollees to Advantage plans because of this.

Plans make bids regarding estimated costs per enrollee, and Medicare accepts those meeting requirements. Each county (or region for regional PPOs) has a benchmark amount to which Medicare compares the bids."