Medicare Advantage plans do not explicitly exclude older, high-cost seniors, but the structure and rules of these plans can create challenges for this group. Medicare Advantage (MA) plans are offered by private insurance companies approved by Medicare and provide an alternative to Original Medicare by bundling hospital, medical, and often prescription drug coverage into one plan. While these plans are popular and growing in enrollment, concerns exist about how they serve older seniors who have higher healthcare costs and more complex medical needs.
Medicare Advantage plans are required to accept all eligible Medicare beneficiaries in their service area without denying enrollment based on health status or pre-existing conditions. This means they cannot outright exclude older or sicker seniors from joining. However, the way these plans manage care and costs can indirectly affect high-cost seniors. For example, MA plans often use provider networks, requiring members to see doctors and hospitals within a specified network. Seniors with complex conditions may find their preferred specialists or facilities are not in-network, limiting their access to care or forcing them to switch providers.
Additionally, MA plans typically require prior authorization for many services, which can delay or complicate access to needed treatments for seniors with chronic or severe illnesses. While these plans often have lower premiums than Original Medicare plus Medigap, they impose out-of-pocket maximums and copayments that can add up, especially for those requiring frequent care. This cost-sharing structure can be burdensome for high-cost seniors, potentially discouraging them from enrolling or continuing in MA plans.
Another factor is that some Medicare Advantage plans have announced exits from certain markets, which can disproportionately impact older, high-cost seniors who rely on those plans for coverage. When a plan leaves, affected members must find new coverage, often during a limited enrollment window. Switching back to Original Medicare and purchasing a Medigap supplement can be difficult for high-cost seniors because Medigap plans often require medical underwriting outside of guaranteed issue periods. This underwriting can lead to denial or higher premiums for those with pre-existing conditions, effectively limiting options for older, sicker beneficiaries.
Despite these challenges, Medicare Advantage plans are popular among seniors because they often include extra benefits not covered by Original Medicare, such as dental, vision, hearing, and wellness programs. Many seniors appreciate the convenience of an all-in-one plan with predictable costs and additional services. The plans also have out-of-pocket maximums, which Original Medicare lacks, providing some financial protection for high-cost care.
However, the complexity of plan rules, networ
