Advantage plans cost more than regular Medicare
 

I was taking with a friend today and I had mentioned that Advantage plans cost the Medicare program more per patient than regular Medicare. He was very surprised to hear that since Advantage plans were originally developed to save money as regular Medicare costs were at that time increasing at a rapid rate. These Advantage plans were supposed to save the Medicare fund money by having drug choice restrictions, physician choice restrictions, specialist access restrictions, etc. Unfortunately, due to bonus payments and other unseen costs the average Advantage patient costs Medicare $321 more than a regular Medicare part B patient!

Mine does not if you refer to the monthly premium. It could if you include deductibles and co pays and are a heavy user of the plan.

True for routine healthy care but the difference is made up on serious illness where Advantage plan provides lowest reimbursements to providers.

I don't know where to start. Have you considered the Federal salaries and benefits to process all of the Medicare Part B claims? And, have you considered that the Medicare Advantage plans are managed by private companies who have a profit a motive to reduce fraudulent claims? What incentive do Federal employees have to deny fraudulent claims? And, have you considered the fact that a patient, who has Medicare Part B and a Medicare supplement has no copay and, therefore, has no incentive to shop for the lowest cost option, and no incentive to reduce treatments or expensive medical supplies or devices. Medicare Advantage plans have all of these incentives to moderate the cost of medical care.

I would be interested to know where you got statistics to back this up.

Let me clarify my topic. I am not talking about how much a Medicare Advantage plan or Medicare-MediGap plan costs an individual patient nor how much these plans reimburse a medical provider or hospital. I am referring to the cost these two plans cost CMS, the government Medicare program that our Medicare taxes and other funds are used to pay out for claims. What it comes down to is Medicare Advantage plans cost the Medicare fund more than regular Medicare. Medicare Advantage plans were supposed to cost less but due to unexpected bonuses and other costs, Medicare has had to pay $321 (recent 2019 data) more per patient than regular Medicare. Since Advantage plans restrict doctor choice, drug choice, require specialist referrals and were paid a set amount of money per patient, they were seen as a way for the government to save money over regular Medicare. Advantage plans are administered by insurance companies and they are extremely profitable. The Advantage plans also offer a lot of freebies, like low premiums and low co pays, free gym memberships, free over the counter drugs, etc. so they are attractive to individuals signing up as they may cost them less up front, but our Medicare fund pays more. This may mean that Advantage plans may come under scrutiny by Congress.

$321 per what? Day? Month? Year? Doctor Visit?

I no longer use Medicare so, I can't speak to your numbers, other than to say, Medicare isa. good example of how a half ass'ed attempt to provide Healthcare works and costs (not very well). The VA which I now get all my healthcare through is a GOOD example of what a universal healthcare system should/could work.

I thank you for bringing this topic to attention. I did a Google search and found an interesting article which describes the process. As any article could be subject to being biased and incorrect, one must be suspect to the article and to interpretation. The article is on this link.

Why Medicare Advantage costs taxpayers billions more than it should – Center for Public Integrity

So, my simplistic interpretation is "Fraud", not by users or providers, but rather by the Medicare Advantage Programs providing the networks. Apparently, the initial program was meant to eliminate fraud by individual claims and this program was conjured up to eliminate that. Seems that the original program was a one cost covers all and some Advantage programs cherrypicked participants to sign up only the healthiest to minimize costs. The program was then changed to add a risk factor for severity of participants needs. Supposedly, that has been abused by some Advantage programs by getting higher funding for participants with higher risks.

Seems that the other benefits offered such as freebies are not the driver since they are not covered by Medicare.

Again, this is my interpretation of the article (which may or may not be true). I would expect the normal on line experts will be around to correct my interpretation and the source that I found.

I am not a user of Medicare Advantage. I have original Medicare and a Supplement program which also now pays for Gym membership. Supplement payment is now about $160/Month. Gym membership was $55/Month and now is free, covered by the Supplement which is still $160 / Month. Hmm! Wonder where that extra $55 came from. Maybe the theory is that I am heathier and require less medical care

There is a recent article published in Forbes Magazine (June 15, 2022) on Medicare Advantage Plans. It says Medicare Advantage patients cost on average 4% more per year than what an average patient costs on traditional Medicare. The article has a lot of other interesting information as well. I am no expert and and I was only posting this because I was so surprised when talking to my friend that these Advantage plans weren’t saving money over traditional Medicare.

Sales pitch?
 

Sounds like a sales pitch to me. We use Medicare Advantage, exercise it through (But not restricted to) The Villages Healthcare, and spend less that the stated $321 out of pocket PER YEAR! Everyone is different, of course, and each should do their own homework.

You are talking about your personal cost of a Medicare Advantage plan. (Yes many Advantage plans have lower up front costs)

I am referring to the cost of these plans to the Medicare Program, the huge government fund that is supported by the Medicare tax on wages and other monies. This is where all the money comes from to pay for Medicare recipients healthcare. It is a huge government expenditure and it needs monitoring so costs don’t spiral out of control.

The VA is set up to give health care to veterans health care according to their classification and type of injury they received. As a DAV and had no health care when I moved to FL 20 years ago they took care of all my medical needs, after I was old enough for Medicare, I only use them certain things, both have worked well for me.

It’s complicated. There are some reasons the government is fine with paying more per patient with Advantage plans over traditional Medicare. For instance, better health outcomes (after controlling for medical conditions) and medical innovation are common benefits arising from Advantage plans on average.

Lots have been written about this comparison from more serious sources. It’s not fair to simply compare cost per person. Consider costs AND (long term) benefits of each. For example:
Medicare Advantage: A Policy Primer | Commonwealth Fund

What do you do if the VA can’t schedule you for a month ?
I like having a choice, I pay co-pays with the VA because of my income level .
With my supplemental and Medicare I only have a $208 deductible for the whole year . It is cheaper for me to see outside private local doctors I’ve been a patient of for decades . My Medicare part D is $16 a month and the majority of my prescriptions are free .

You do not pay more, the government pays more to the program with the intent of cutting your costs by managing your care and not permitting you choice in your care. The program takes the money that should go to people who are signed up for the care. It is the first step in privatization and should never be chosen as your plan. They get the people with gimmicks that are not health related.