There’s no question today because I want to discuss the wonderful news that a 10-year agreement was signed by UPMC and Highmark that will grant the vast majority of those on Highmark health and Medicare plans in-network access to UPMC doctors and hospitals.
I was extremely surprised by this announcement. In fact, in my column that ran last Monday, the same day Attorney General Shapiro and Governor Wolfe announced the new agreement, I predicted Highmark Medicare Advantage Plan members would not be able to access UPMC facilities at an affordable rate, if at all, in 2020.
I’m not sure I’ve ever been more pleased about being wrong!
I realize the fight between Western PA’s two biggest health care and health insurance providers was very stressful. But in the end, I believe it’s going to turn out to be beneficial for tens of thousands of seniors because it forced those who were on overpriced plans to shop and change companies to one that allowed access to UPMC. In every single case we had, the result for our client was a combination of lower premiums and very similar or better overall benefits.
However, there were still many who chose to remain on plans that weren’t competitive. I’m worried that with the new contract, people will either go back to their old plans despite their deficiencies, or once again renew their plan every year without comparing them to competing companies.
It’s human nature for those who’ve been with an insurance company for years upon years to be fearful of change. Unfortunately, in the case of Advantage Plans, that fear and refusal to move elsewhere has resulted in the overpaying of premiums, and overexposure to out of pocket costs. I’ve written about it on numerous occasions and will continue to do so until I’m convinced it’s no longer an issue.
Since I entered the health and Medicare business over 11 years ago, premiums on what were some of the most popular HMO’s and PPO’s have gone up 500% to 600%. In addition, the amount of medical bills one could possibly pay in a calendar year, also known as the Maximum Out of Pocket (MOOP) virtually doubled, going from $3,400 to $6,700. Yet, tens of thousands of people continued to pay more and get less over the years due to the comfort of familiarity.
The most satisfying part of our jobs as Medicare brokers is when we help seniors who are paying $200-$300/month for their Advantage Plan HMO or PPO save as much as $3,500 per year in premiums, while lowering their MOOP $3,000 or more. Helping someone living on a fixed income save that kind of money, while ensuring as good or better overall benefits is a great feeling.
However, I can’t even count how many times myself or one of our other agents have compared plans side by side, showing the savings in black and white to seniors who literally couldn’t make a change out of fear of leaving a company they had been with for as many as 40 or 50 years. Despite a different plan having all their doctors in network, the opportunity to save thousands in premiums and have less exposure to out of pocket costs, they stayed put on an overpriced plan.
I hear words like this. “It’s always worked for us.” Or, “When I had my heart attack in 1999, the bill was over $50,000 and they paid it.” Or, “We’ve had it forever.” Or, “I’m worried the other company won’t cover everything my current one does.”
All those statements should never come into play when choosing a plan as there are protections for consumers. Remember, all Advantage Plans are regulated by the Centers for Medicare and Medicaid. They all must cover the same services which have to be as good or better than original Medicare. They also cannot deny an application or refuse to pay a claim due to pre-existing conditions.
When I first got into the business in 2008, for about five years there was a different Advantage Plan company who had the best overall package from one year to the next. We literally advised clients to go with four or five different companies or plans in that span. Who is our favorite company? The one that offers our clients the best value that year. We currently have 75% or more of our Advantage Plan clients, approximately 2,500 people, with one particular company. If we feel another is going to be better in 2020, we’ll advise all 2,500 of those people to consider changing. If the company they left in 2019 turns out to be the best option, we’ll advise going back.
The name of the company and the logo on your card mean nothing. When choosing a plan, consider the following: Are the doctors and hospitals you need in network? Premiums - this year the vast majority of the plans people signed up for with our agency were under $60. The MOOP - we prefer plans that have one on the lower end, $3,400. Hospital co-pays - we prefer plans that have a per stay co-pay of under $500 to those that charge by the day and can result in a bill from $1,000 to $2,000.
Let’s celebrate the news of the UPMC/Highmark reconciliation. But let’s not allow it to influence our plan choice in 2020 and beyond.