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Medicare Open Enrollment: Elders Have Much to Consider for 2011

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By Linnie Frank Bailey –

Seniors from across the country are being bombarded with an advertising blitz touting the benefits of various Medicare Advantage Plans.

There are celebrities from years gone by promoting plans on TV; a multitude of mailings listing the benefits of various plans; and, invites to lunch and dinner meetings where Medicare is discussed.

All of this is because of the annual Medicare Open Enrollment period which began November 15 and lasts until December 31 of this year.

For the coming year, older Americans are struggling to make sense of Medicare changes in light of the health care reform law. Henry Romero, President and Owner of Riverside-based HR Benefits Consulting, cautions, “Seniors need to pay particular attention to Medicare changes for 2011. Some are brought about directly from the health care reform law and others are the result of companies “tweaking” their plans in anticipation of law requirements that may be years away.”

An important change for 2011 is that the “open enrollment period” that was previously offered from January through March, has been eliminated. In prior years, after initially enrolling in a plan by December 31, seniors could change their minds and enroll in another plan between January 1 and March 31. However, effective in 2011, enrollees are ‘locked in’ to the plan they originally chose, with their only option being to dis-enroll entirely from the plan between January 1 and February 15.

“Seniors have to choose their plan carefully before December 31, because unlike in past years, they won’t be able to change their mind the following year,” says Romero.

Only a fourth of Medicare beneficiaries opt for Advantage plans with the remainder choosing the traditional fee-for-service Medicare system. However, confusion reigns among seniors over what they sign up for. A National Council of Aging (NCOA) study showed that 40% of survey participants said they had joined an Advantage plan when in reality over half had done so.

This confusion will only be heightened as health care reform changes are enacted during the next decade. For instance, many seniors are aware of the closing of the ‘donut hole’ gap for prescription drugs, however there is still confusion on whether Medicare premiums will rise and what services will be continued.

Fear was heightened this past week when the state of Arizona announced certain organ transplants for Medicaid recipients will be dropped because of high costs to the state. Seniors worry these types of actions may spread across the country as cash-strapped states look for ways to cut their budgets.

Critics of the Obama Administration’s plan say that Medicare premiums will skyrocket, choices will disappear, and severely ill Americans will see ‘death panels’ that will determine whether treatment is cost-effective.

President Obama responds that the health-care overhaul he pushed through Congress this year has added at least a dozen years to Medicare's solvency.

There is no doubt, however, that the nation’s growing aged population will strain the system. Starting in 2011, the boomer generation (those born from 1946 through 1964) will start turning 65 at the rate of one every eight seconds. That means more than 10,000 people each day – or almost 4 million per year - - will be eligible for Medicare (if they are not already receiving it due to certain disabilities).

Pasadena resident, Betty Morris, who turned 65 this past August, remembers being deluged with mail in the months leading up to her birthday. “There were so many different options for Medicare and invitations to attend briefings,” she recounts. “Most offered a free meal just for showing up to a meeting!”

Morris says she discarded most of the mailings because, as a recently retired employee of Kaiser Permanente, she knew she would be joining their coverage plan for retirees.

“Unlike some of my friends my age, I was fortunate to have a company HR rep to talk to before having to decide on a plan,” she recounts, adding that she found the 136- page government issued book, Medicare and You, cumbersome and not easy to navigate. “The book is readable because they print it with lots of large print and bold letters. But it is not understandable for the average person,” she said.

Morris believes most of her friends, like herself, ignore the manual and instead look to associates and family members for information on Medicare. As African- Americans, they are aware of the diseases that afflict their families and community, but Morris isn’t sure how this knowledge is used when selecting a Medicare option.

(See Sidebar) Another Medicare change for 2011 is the possibility that doctors may drop new Medicare patients due to upcoming cuts in the amount paid to physicians. These cost reductions, which are not part of the health reform act, have drawn the ire of the California Medical Association and AARP, which recently launched a campaign to persuade the lame-duck Congress to act immediately and vote to prevent the deep Medicare cuts, scheduled to take place in the next two months. Both organizations believe failure to repeal the cuts will force many physicians to quit accepting new Medicare patients.

Morris is happy with her Medicare coverage; nevertheless, she is concerned about her health care costs if she moves outside Kaiser’s service area. She has contemplated moving closer to her daughter and grandkids in Austin, Texas, but says, “In Austin, I can still get Kaiser covered care but it will be more difficult because I will have to pay first and be reimbursed later. I’ll have to find the network Kaiser contracts with in Austin and submit claims for reimbursement. Now, I don’t have to worry about paying in California.”

Moving outside of their plan’s service area is a real concern for seniors and should be considered before choosing a Medicare Advantage Plan. It is also a consideration for adult children contemplating moving their aging or sickly parents to their locale.

Morris however, isn’t ready to give up her California lifestyle and friendships. Like many of today’s 65-year-olds, she and her friends are active and healthy. Yet they are concerned about long-term care down the road. “Aging can be difficult and expensive,” says Morris. She doesn’t think health care reform is going to make it any easier given the swelling numbers of adults over 65.

But younger people, who are still working, may not face these challenges. The Community Living Assistance Services and Support (CLASS) Act provision in the new law will allow Americans to save for something most will eventually need -- assistance in eating, bathing or dressing in their old age. It is the federal government's first long-term care insurance program that will allow workers to have an average of roughly $150 or $240 a month, based on age and salary, automatically deducted from their paycheck to save for long-term care. But the CLASS Act won’t help people like Morris.

“Where’s the money going to come from?” she asks.

“Will America be able to pay for our increasing health care needs, 10, 20, 30 years down the road?”

The Administration insists that health care reform enacted now, and in the next few years, will solve this issue.

Others aren’t so sure.

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