Farewell Medicare Advantage, Hello Medicare Supplement Plans

There was an interesting article in the Wall Street Journal on June 11th

, 2010 on page A18 that discusses the future of the Medicare Advantage program and the pending changes seniors will experience first hand. While there is a definitely a conservative bias to this article, many of the statements are fact rather than opinion. The democratic government in an effort to preserve the Medicare program and enhance coverage has made several changes.

The underlying cause of these changes is due to the fact that the government is going to cut over $135 billion in funding to the Medicare Advantage program over the next ten years. This will create a very similar environment to the one Seniors experienced in 1997 when the Medicare + Choice program was starved of funding and Senior HMO plans stopped offering insurance options in nearly every state. The result of the changes in 1997 forced people over 65 to purchase Medicare Supplement Plans so they could limit their out of pocket costs for medical services.

The good news is that Medicare Supplement Plans offer great coverage, often better than the coverage provided by Medicare Advantage plans. In addition, with Medicare Supplement Plans there are no provider networks so people who are enrolled in these plans can visit any doctor or hospital as long as they accept original Medicare. People who talk to there doctors consistently also know that they prefer their patients have Medicare Supplement Plans because they are easier for health care providers to work with.

People who are enrolled in Medicare Advantage Plans will likely need to shop for Medicare Supplement Plans at some point over the next few years as many people are expecting enrollment in the Medicare Advantage program to drop significantly. The Congressional Budget Office believes enrollment will drop by over 35%, while Medicare is more aggressive with their assumption and believes enrollment in these plans will drop by over 50%. In addition, both Medicare and the Congressional Budget Office believe benefits will likely decline, making the coverage worse.

With a decrease in benefits, and higher prices, there will be no wonder why seniors will likely purchase Medicare Supplement Plans. In addition, most people will want to continue to visit the doctors they know and trust, which is an even greater reason to purchase a Medicare Supplement Plan. Medicare Advantage plans have been getting worse and worse over the past few years and experts expect this trend to continue. Most seniors will reach a breaking point over the next few years and will enroll once again in original Medicare.

The most important thing to remember is in light of all these changes, the Medicare program will be financially stable and preserved for future generations. Obama told seniors in Wheatland, Maryland, what you need to know is that the guaranteed Medicare benefits that youve earned will not change. Original Medicare combined with Medicare Supplement Plans provide excellent coverage for an affordable price, and most seniors will be much better off and have less headaches.

by: Tyra Phillips

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