IF YOU'RE on Medicare, prepare. You're approaching the most bewildering few years you'll ever see. If you have a parent on Medicare, be ready to help.
Last summer, Congress "privatized" Medicare through a program called Medicare Plus Choice. It creates four new types of Medicare health plans -- each with different rules for securing treatment and getting your benefits paid.
Together with traditional, fee-for-service Medicare (now called Original Medicare) and Medicare HMOs, we now have six kinds of plans in all. You will have to think about which you want.
All the new health plans provide the same coverage you get from Original Medicare. But some plans add extra benefits, or (at a price) give you greater medical choice.
Signing up for Medicare will change from an easy process to something maddeningly complex. Many people won't know how to choose. And they might not always understand the implications of their choices -- for example, how much they're likely to pay out of pocket for a particular plan, or what happens if the plan goes out of business.
The Health Care Financing Administration (HCFA), which manages Medicare, isn't going to hit the whole country with these changes all at once.
It will start with 5.5 million designated guinea pigs -- namely, the Medicare enrollees in Arizona, Florida, Ohio, Oregon and Washington state.
In November, the guinea pigs will get a new government handbook called Medicare & You. It will explain what Medicare covers and the new kinds of plans on the menu.
The handbook will also list the names of local health plans, showing each one's basic rules and cost. An 800 number will be on tap, as well as a World Wide Web site (www.medicare.gov). You can sign up for one of the listed plans or keep the Medicare you have.
If you live in one of the 45 non-guinea-pig states, you'll get a Medicare bulletin this year, explaining the new plans in brief. You can also check the Web site for the names of plans in your area.
In November 1999, Medicare's new sign-up program will go nationwide. All beneficiaries will get a copy of Medicare & You, including the names of local plans. HCFA will have improved the handbook, based on the feedback it got from the guinea-pig states. Maybe recipients will be slightly less confused.
Luckily, there aren't any new types of plans in this trial run -- just the familiar HMOs and Original Medicare. Next year, however, you will probably find more choices on your plate.
Of the four new choice plans, two are versions of managed care. A "preferred provider organization" keeps you within a member network of doctors and hospitals, but with more options than you get from an HMO. A "provider sponsored organization" is an HMO run by doctors and hospitals rather than an insurance company. The doctors and hospitals can't bill more than Medicare allows.
The other two plans are essentially government-subsidized private insurance. There's a classic fee-for-service plan, which could attract the fancier doctors. Also, a medical savings account, where you pay upfront costs and buy private insurance (with government help) to cover the larger bills.
These latter plans let doctors and hospitals charge you more than the usual Medicare limit. In other words, they're for people with money. The average beneficiary will want Original Medicare, an HMO or another type of managed-care plan.
Explaining all this to older Americans will be an enormous task. The Medicare Plus Choice plans (mostly HMOs) are supposed to pay a substantial share of the public-education cost, since the booklets advertise their plans. But they're protesting.
The public-education budget was cut this year, and may be cut next year, too. HCFA is relying on volunteer groups, newspapers, organizations for the elderly and state insurance hot lines to help spread the word.
Corporations should gear up, too, says Ed Susank, a principal in the consulting firm William M. Mercer in Washington, D.C. Retirees will want to know how the new Choice plans blend with their employer plans.
Some employers may even push their retirees to pick one of the LTC managed-care plans, Susank says. The plans limit patient choice, but save employers money.
One super important point: If you already have Medicare, you can keep the plan you have, says Diane Archer, head of the Medicare Rights Center in New York. You don't have to do anything at all.
For Archer's good advice, send for the booklet, Medicare Changes, Medicare Choice, $3, from the Medicare Rights Center, Box CC, 1460 Broadway, New York, N.Y. 10036.
Pub Date: 10/19/98