Making sense of Medicare Advantage plan advertising

If you watch television, listen to the radio or use the internet, it is hard to miss advertisements for Medicare Advantage plans. It’s open enrollment time, so expect the wave of advertising to continue through Dec. 7. People who are not enrolled in a Medicare Advantage plan have until Dec. 7 to opt in. For those already enrolled in Medicare Advantage, switching from one plan to another is allowed between Jan. 1 and March 31. Health care services expert Lee Revere, Ph.D., a professor and chair of the department of health services research, management and policy at the University of Florida College of Public Health and Health Professions, offers insights on Medicare Advantage ads and messaging.

Question: What is Medicare Advantage?

Answer: Americans age 65 or older can choose to receive federal Medicare health insurance benefits through original Medicare, also known as traditional Medicare, in which the government pays for covered health care services, or through Medicare Advantage. Medicare Advantage health insurance plans are provided by Medicare-approved private companies. Medicare pays these companies to provide health care coverage.

Medicare Advantage plan users are required to have Part A and Part B of original Medicare. Part A covers hospital stays while Part B covers medical services delivered by outpatient providers. Although original Medicare covers inpatient and outpatient services, beneficiaries share costs via deductibles and co-insurance. To offset those costs, some beneficiaries buy MediGap insurance to cover the payment “gaps.”

Medicare Advantage plans offer benefits beyond those provided by Medicare Part A and B, including dental, vision and wellness plans. In addition, Medicare Advantage enrollees do not need MediGap insurance. Some Medicare Advantage plans charge a monthly premium, but many are free.

Q: Why are we seeing Medicare Advantage plans advertised everywhere?

A: Insurance works when you have large numbers enrolled; it is a risk-based business. Just like car or home insurance, the more people who pay into the risk pool, the more the risk is spread, which benefits the insurance company. Companies offering Medicare Advantage programs are competing to grow their customer base through direct mail, telemarketing, and radio, television, web and social media ads.

A Commonwealth Fund report found that during last year’s open enrollment, most older adults received some type of Medicare Advantage plan marketing. More than three-quarters of older adults reported seeing one or more TV or online ads per day, and 30% said they received seven or more phone calls a week. Recently, watching the news for one hour, I saw five Medicare Advantage ads.

Q: Are some of these Medicare Advantage advertisements misleading?

A: Some are and some aren’t. But many invoke emotion and a sense of urgency:

• Telling viewers they must call now.
• Suggesting you are missing out on Medicare benefits.
• Suggesting your Medicare benefits have changed and you need to call to learn more.
• Noting that your out-of-pocket costs might be high if you don’t select Medicare Advantage.
• Offering a “free benefits check-up.”
• Using visuals with flags and attention-grabbing language and colors.

Q: What rules are in place to protect consumers?

A: Starting in 2024, the Centers for Medicare and Medicaid Services will prohibit ads that use Medicare logos or other words and imagery in confusing or misleading ways. Ads that do not mention a specific plan name are also prohibited.

The regulations emphasize the need for Medicare Advantage plans to be more proactive in monitoring agent and broker activities. While vendors or brokers may create misleading marketing messages, it is the Medicare Advantage plans’ responsibility to stop them.

Q: How does someone avoid picking the wrong Medicare Advantage plan?

A: I am not sure any plan is wrong or flawed. There are plans that are better for different individuals. Medicare beneficiaries need to consider how they use health care, their financial constraints and their willingness to use in-network providers. Medicare Advantage plans can often save beneficiaries money if they have high dental, vision or medication costs with original Medicare. However, Medicare Advantage plans often require referrals and preauthorization for services. Eligible beneficiaries should also consider if they travel frequently, particularly internationally. Some Medicare Advantage plans may not cover beneficiaries who are out of the service area for long periods.

For more information, these are good resources:

• Medicare’s one-page summary of the differences between original Medicare and Medicare Advantage.
• AARP has a short article discussing original Medicare and Medicare Advantage plans.
• Medicare offers a comprehensive review of Medicare Advantage.