- Medicare Advantage is not a "robust" alternative to Medigap coverage.
Nearly every independent Medicare advocate will tell you that a comprehensive Medigap plan is almost always better than a Medicare Advantage plan if an individual can afford a Medigap plan. Please click here for a more detailed explanation.
- The Affordable Care Act does not eliminate the need to have a Medigap insurer of last resort.
BCBSM and Governor Snyder are inaccurately using the Affodable Care Act ("Obamacare") to explain why an 'insurer or last resort' is unnecessary in Michigan. Regarding Medigap plans, this statement is wholly inaccurate. The Affordable Care Act did nothing to change the underwriting requirements of Medigap plans. Individuals 65 and older are only entitled to a Medigap plan without underwriting under certain limited circumstances. Individuals under 65 are never guaranteed a Medigap plan without underwriting. The Affordable Care Act did nothing to change this.
If anything, the Affordable Care Act makes it more beneficial to have an affordable, guranteed Medigap plan for Michiganders. Currently, Medicare pays Medicare Advantage plans 14% more than what it spends on equivalent services under Original Medicare. The Affordable Care Act cuts this 14% meaning premiums for Medicare Advantage plans may go up or the service provided under Medicare Advantage plans may go down. Individuals with Medigap plans will not see any change. Please click here for a more detailed explanation about these points.
If anything, the Affordable Care Act makes it more beneficial to have an affordable, guranteed Medigap plan for Michiganders. Currently, Medicare pays Medicare Advantage plans 14% more than what it spends on equivalent services under Original Medicare. The Affordable Care Act cuts this 14% meaning premiums for Medicare Advantage plans may go up or the service provided under Medicare Advantage plans may go down. Individuals with Medigap plans will not see any change. Please click here for a more detailed explanation about these points.
- The rate freeze until 2016 is politically convenient, but does not prevent BCBSM Legacy from ultimately being cut.
Conveniently, in the wake of the 2010 political debates over Medicare cuts, BCBSM entered into an agreement with the State of Michigan to hold Legacy rates constant until 2016. That agreement is now being used to effectively gloss over a probable cut to an invaluable Medicare option in Michigan. Nothing currently guarantees Legacy plans after 2016. Nothing prevents significant rate hikes after 2016. Nothing currently guarantees that Michiganders will be able to enroll in Legacy when the legislation passes. And nothing currently guarantees that Michiganders with disabilities will be able to enroll in an affordable Medigap plan. Please click here for a more detailed explanation.
- A $1.5 Billion fund over 18 years is woefully insufficient.
The proposed $1.5 Billion "fund" to benefit needy Michiganders is woefully insufficient to cover what Michiganders are being asked to give up. If spread out equally over 18 years, BCBSM is offering less than $1 Billion in today's dollars. BCBSM will make more than this back by shifting Legacy plan holders to market rates in 2017 alone. In other words, Legacy plans themselves are worth more than $1.7 Billion over 18 years without even considering the intangible benefits of giving up an an insurer of last resort or an insurer with greater consumer rate protections. Please click here for a more detailed explanation.