Six Myths about Medicare

[Robyn55]

Medigap policies are now standardized by the US government - but sold by private insurance companies - and paid for by Medicare recipients. So of course someone who has both Medicare and a Medigap policy is going to pay more than someone who only has Medicare.

FWIW - I was kind of surprised to read about the demographics of people who buy Medigap policies - especially the high priced ones (in various studies/articles). But then when I thought about it...

Lower to middle income people can't afford large unanticipated medical expenses (in the form of co-pays/deductibles). They know what they'll pay for their Medigap policy. Older people tend to need more specialists - whose availability may be limited in MA plans. The limited availability of providers may be a factor for the rural buyers too. As for women - they live longer - so that's probably why there are more women than men in the plans.

On my part - I think the only way to make a drastic impact on Medicare expenses is: 1) to require prior authorization/a certificate of reasonableness from a gatekeeper PCP or specialist for most expensive tests/medical procedures/surgeries/etc.; and 2) to say that some things won't be covered at all - and other things won't be covered if you're a certain age and/or you have other medical things going on which make the medical expenditure stupid. People would of course be free to pay for these things themselves. I don't know about you - but I think I'd skip my annual mammography if I were dying from brain cancer. Robyn

[Ariadne22]

Originally Posted by Khsoj

According to MedPac studies, in total Medigap costs 33% more than original Medicare. I don't expect Medicare to go away nor to evolve into the joke that Ryan has proposed. Mediicare is too embedded in the US economy. But the payment mode is going to change. High deduct F and plans M and N are 1st steps in that direction.

Current Medigap allows too much expense in healthcare without regard to cost savings. Even Medicare admits that.

How does what you say make any sense? Medigap (private insurance) does NOT cost Medicare money. The private Medigap insurer collects a premium from the policyholder and protects policyholder against the 20% not paid by Medicare. For really ill people, that 20% can add up, especially if there are multiple hospitalizations, chronic ailments. Medicare pays the same amount - with or without a Medigap as backup. I don't think you understand what Medigap is.

You gotta explain to me how not having the ability to purchase PRIVATE gap insurance to cover the Medicare 20% copay will save Medicare money.

If the rationale is Medigap users generally use more Medicare because their costs are essentially limited to the Medigap premium, you are talking about a lack of Medigap providing a psychological incentive not to see the doctor. Very different than Medicare actually paying more.

It doesn't.

Medicare pays what it pays based on its approved reimbursement rates - not because the patient has a Medigap.

[Khsoj]

Medigap results in increased usage of healthcare. Medicare has no cap. And for those in Medigap plans there is no incentive to contain expenses.

Lots of discussions over the past year or so to put a deductible in all Medigap plans. $500 yearly seems to be the most common quoted.