Medicare Advantage members can lose access to their hospitals, hospital systems and other providers at any time during the year, and when it happens, most beneficiaries have no way to change coverage until months later.
Changes in providers during the year are happening more frequently, according to Becker’s Hospital Review, Thomson Reuters reported.
Why Hospitals And Insurers Keep Clashing
Hospital systems and Advantage plan sponsors have fought with each other for years over two issues. One is prior authorization.
Hospitals and other medical providers say they don’t not receive payment for procedures and treatment unless they receive prior authorization from the plans. The hospitals say Advantage plans deny treatment requests too often.
One report concluded that Advantage plans deny treatment requests six times more often than original Medicare denies claims. Original Medicare generally does not approve or deny payment until after the services are rendered and a bill is sent to Medicare.
A health system in Oregon said Medicare Advantage plans denied 22% of prior authorization requests, while original Medicare’s denial rate was 1%.
Medical providers say that when they expend the time and resources to appeal denials, the appeals usually are successful.
Payment Disputes Add More Tension
Another issue is that providers say the Advantage plans are slow to pay and sometimes pay less than the amount billed.
Advantage plans say that many hospitals are inefficient, making costs too high.
The result is some major hospital systems no longer accept Advantage plan patients, and the list is growing rapidly.
This year major providers that have eliminated or reduced Advantage plan relationships include the Mayo Clinic, Johns Hopkins and UNC Health, according to Becker’s Hospital Review.
Becker’s said about 25 major health systems have joined the list already this year.
The Advantage plans said that not all the separations were at the initiative of the health systems.
Advantage plans terminated arrangements with health systems because of inefficiencies, high costs or other reasons.
Why Beneficiaries Are Stuck When Networks Change
Beneficiaries should know that Medicare Advantage plans can make changes to the provider network at any time during the year.
Yet, a beneficiary can switch Advantage plans or change to original Medicare only during the Annual Enrollment Period from Oct. 15 through Dec. 7 or the Open Enrollment Period from Jan. 1 through March 31.
There is another little-known drawback to Advantage plans.
The Medigap Rule Most People Don’t Know
During a beneficiary’s initial enrollment period, Medicare supplement (or Medigap) insurers must issue the beneficiary a policy without any medical underwriting.
After that, medical underwriting is allowed. A beneficiary can be denied coverage or charged a higher premium after the initial enrollment period. (There are some states that restrict medical underwriting for Medigap plans more than federal law does.)
Sometimes a beneficiary wants to change Medigap policies. Or a beneficiary who initially selected an Advantage plan decides to switch to original Medicare with a Medigap policy.
In either case, medical underwriting could prevent the beneficiary from obtaining an affordable Medigap policy.
But when an Advantage plan is discontinued or is no longer available in a beneficiary’s area, a 63-day guaranteed issue period for Medigap policies opens for the beneficiary.
The Catch: Provider Changes Don’t Trigger Medigap Protections
What is little known is that a change in providers in the Advantage plan’s network is not a plan termination, no matter how significant the provider is.
The change does not trigger a new guaranteed issue period for Medigap policies.
In that situation, a beneficiary who wants to join original Medicare and obtain a Medigap policy is subject to medical underwriting, except for beneficiaries in the few states that limit medical underwriting of Medicare supplement policies.
Expect More Disputes — And More Network Changes
The bulk of medical expenses are incurred at hospitals. Medicare Advantage plans will continue to try to restrain costs.
These disputes will continue, and changes in provider networks are likely to continue.
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