Retiree Health Plans Moving to Medicare Advantage

Retiree health benefits are pretty rare these days, but I have  two friends and two relatives who worked for big companies that offer benefits to supplement Medicare for their retirees.  These people are in their 70’s and 80’s and have each been moved from Medicare to Medicare Advantage plans – and not one of them understood what that meant.

Retiree Health Plans moving to Medicare Advantage.

Just before Christmas, I visited my 86-yer old friend Julie in Connecticut and was surprised to find that she is being moved into a Medicare Advantage plan as of January 1st, 2015.   Julie had a long career with Pfizer, the pharmaceutical company, and she was able to take care of all her affairs until just a few months ago when she had a stroke.  My smart and funny friend, with whom I have shared many conversations about politics and sports, is now totally dependent on her team of caregivers. Recently, her kidneys failed requiring her to go on dialysis.

Julie was so smart that she had a long term care insurance policy that is now paying for her to be taken care of at home.

Julie’s family and caregivers are taking great care of her, but they don’t have a clue about insurance – and they had piles of paperwork spread across the kitchen and dining room tables.  In the middle of those piles of papers I found a thick “Evidence of Coverage” book for a UnitedHealthcare Medicare Advantage plan.  I proceeded to rummage through assorted papers and found a letter from Pfizer dated in July.  The letter said all Pfizer retirees will be moved to a UnitedHealthcare Medicare Advantage plan for 2015.  I also found a  Medicare Advantage id card for Julie.

I explained to Julie’s family how the Advantage plan works.  It is a PPO plan and the materials say she can see doctors in-network or out-of-network for the same co-pay.  But out-of-network providers must agree to bill UnitedHealthcare – and that means Julie’s caregivers must explain this to all of her doctors, labs, home healthcare providers, and the dialysis center.

I worry about Julie’s dialysis because a person getting dialysis really shouldn’t be on a Medicare Advantage plan. That’s because dialysis is so expensive and the Advantage plan is only paid a capitated amount of money by Medicare for each person enrolled in the plan.  The Advantage plan will be okay for Julie as long as all the providers agree to bill United. Her max out-of-pocket for 2015 is just $3,400, so she is protected from never-ending medical bills.  But United is going to get slammed by the dialysis bill.

To tell you the truth, I’m not worried about UnitedHealthcare, but am worried about Julie’s family and caregivers understanding what they need to do as of January 1st.  I have explained to them that they need to tell everybody who is providing medical services to Julie that she no longer has Medicare and they must bill UnitedHealthcare.  They probably also need to get approval for all the services Julie has been getting because everything now goes through United. Hopefully, there won’t be any problems due to this change.

If I had not visited Julie and if I had not been the nosey neighbor rummaging through those papers, Julie’s family would have never realized her Medicare coverage was changing as of January 1st.  If they use her Medicare card in 2015,  her medical bills will be rejected by Medicare.  What a nightmare that would be!

A note on the nosey neighbor:  Julie’s family had asked me to look through the piles of mail to organize the long term care paperwork and to try to understand how her Medicare supplement worked.

I tell all my clients that they need to review their Medicare benefits every fall. I guess I also need to tell my friends and relatives to do the same if they have a retiree plan.  Of course, when people are in their 80’s and 90’s, they might not be capable of reviewing their benefits. It seems like Pfizer and other companies are assuming their retirees are, indeed, capable of reviewing their coverage and understanding the changes being made. I have a feeling there are lots of  people like Julie who haven’t got a clue about the changes coming to their Medicare coverage.