CONSUMERS BEWARE! MEDICARE SALES ABUSES

The confusing array of private plan options for drug and medical coverage can make people with Medicare vulnerable to deception and bullying by unscrupulous insurance agents. Sales reps looking to maximize the commissions they receive from insurance companies may target frail older adults, people with cognitive disabilities and the poor and sick who are worried about paying their medical bills.

Each Medicare Advantage enrollee generates thousands of dollars in additional taxpayer-funded subsidies for the insurance company offering the plan. So, insurance companies typically pay brokers about $500 for every person they enroll in a Medicare Advantage plan offering both medical and drug coverage, more than five times the commission they pay for signing someone up for a plan that just covers drugs and allows the individual to stay in Original Medicare. As a result, counselors across the country last year answered thousands of calls from individuals who found themselves in a Medicare Advantage plan when they thought they were signing up just for drug coverage. These individuals were often saddled with high medical bills when they discovered their doctors would not accept their new plan, or the plan imposed high cost sharing for major medical expenses. Neither the insurance companies nor CMS ensures that brokers and agents adequately and honestly explain these plans to consumers.

Of all the Medicare Advantage plans, private fee-for-service plans are the ones most subject to aggressive and deceptive marketing. Unscrupulous agents tell prospective customers that “all doctors take this plan” or say it is just like Original Medicare. Neither claim is true.

-Adapted from: From: “Stop This Scam” Asclepios/Medicare Rights Center Advocacy e-mail, Volume 7, Issue 5, February 01, 2007.

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