Choosing a Medicare Plan? Don’t Rely on the Medicare & You Handbook
The Medicare & You Handbook is the official U.S. Government Medicare Handbook put out every year. Inside, you’ll find detailed information about the parts of Medicare, how to sign up for Medicare, Medicare Advantage plans, drug coverage, and so much more.
However, be warned that the handbook has a troubled past, and even after being revised, it still doesn’t clearly outline all of your post-65 health insurance options.
Need Medicare help? The Medicare Allies team specializes in Medicare health insurance as well as retirement planning. Read more about what we do and request a free personalized Medicare Planner with a qualified agent today!
The Shady Past of the Medicare & You Handbook
The 2020 Medicare & You Handbook has a few pages dedicated to explaining your options. However, be warned that it’s been criticized in the past for being a bit biased.
The Center for Medicare Advocacy explained in a 2018 statement about that year’s handbook draft: “[I]nformation about traditional Medicare and Medicare Advantage (MA) distorts and mischaracterizes facts in serious ways.”
For example, the handbook draft suggested that Medicare Advantage is the less expensive alternative for beneficiaries. (Not always true!)
It also failed to highlight the clear difference between Medicare and Medicare Advantage, which is the networks! Medicare gives you access to any provider that accepts Medicare assignment. Medicare Advantage limits your access to a network of providers in a specific area. This is critical information, especially for those who travel often or go south for the winter.
Finally, the handbook made prior authorization requirements seem like a benefit when in reality, they’re a hurdle you have to go through to get coverage. And that’s not a hurdle you have to go through with Original Medicare.
Overall, the trend was clear – the handbook draft favored Medicare Advantage. It made MA seem better than it was while also downplaying some of the drawbacks.
The Center for Medicare Advocacy, Justice in Aging, and the Medicare Rights Center ended up sending a letter to the Centers for Medicare and Medicaid Services (CMS) about these issues, and the handbook has since been fixed.
While the 2020 version seems to be pretty fair, we think understanding the context and history of the handbook is important. Just be warned that you may be urged to choose Medicare Advantage, and that’s not always the best choice (sometimes it is, but not always!).
Two Options Explained, But There Are Three!
Either way, the 2020 Medicare & You Handbook gives you a good idea of your two basic routes:
- Original Medicare + optional Medicare Supplement + optional Medicare Drug Plan
- Medicare Advantage (typically with drug coverage bundled in, called MAPD)
But there’s a third option that is gaining popularity rapidly called a Medicare Medical Savings Account (MSA).
We suspect it’s not featured as a third option because it’s technically a type of Medicare Advantage plan. It also hasn’t been widely available until recently.
However, the features of an MSA are not the same as the Medicare Advantage features explained in the beginning of the handbook.
Related Reading: How Do Medicare MSA Plans Work, and Do I Need One?
An MSA Is Different Than Traditional Medicare Advantage
Under Medicare Advantage, the handbook states you’ll need to use doctors who are in the plan’s network. With an MSA, you don’t have a network – you can see the same doctors you can see under Original Medicare. This is a key difference between the MSA and other Medicare Advantage options.
Next, the handbook states that with Medicare Advantage, you may need a referral to see a specialist. MSA plans do not require referrals.
Under costs, it says Medicare Advantage plans may have a $0 premium. All MSA plans are $0 premium – there’s no “may” about it.
Finally, the handbook explains that prescription drug coverage is included in most Medicare Advantage plans. However, with an MSA, you need to purchase a separate Medicare Part D Drug Plan. Drug coverage is not included with an MSA.
Last but not least is the main, stand-out feature of an MSA that of course isn’t mentioned at all in the beginning of the handbook: the deposit!
With an MSA, you’re given an annual deposit to use towards qualified medical expenses (it’s substantial – typically several thousand dollars, but it can change every year).
Just because the MSA is a type of Medicare Advantage plan does not mean it has the same features. And if you were relying on the Medicare & You Handbook for this, it can be quite misleading. In the Original Medicare vs. Medicare Advantage section at the beginning, the Medicare & You Handbook is really only talking about HMO and PPO Medicare Advantage plans – not the other available options, such as an MSA.
The handbook doesn’t address the different types of Medicare Advantage plans until much later in the book, and even then, you only get one paragraph on what an MSA is:
“These plans combine a high-deductible health plan with a bank account that the plan selects. The plan deposits money into the account (usually less than the deductible). You can use the money to pay for your health care services during the year. MSA Plans don’t offer Medicare drug coverage. If you want drug coverage, you have to join a Medicare Prescription Drug Plan. For more information on MSA Plans, visit Medicare.gov.”
Related Reading: Lasso Healthcare MSA Review
Another Misleading Detail In the Medicare & You Handbook
Something that struck us as bizarre is the following statement about Medicare Advantage: “Plans may have a $0 premium or may help pay all or part of your Part B premiums.”
Medicare Advantage plans that help pay all or part of your Part B premiums are extremely rare, so to showcase that front and center is a bit deceiving. It’s not a core feature of a Medicare Advantage plan by any means, nor is it the norm.
This feature, which is really a rebate, is only available in small areas of the US. It would’ve been more accurate to have this as a footnote – not part of your options at a glance.
Know Your Specific Medicare Plan Options
While the Medicare & You Handbook is a great resource to go through when you’re aging into Medicare, it’s never going to give you your specific Medicare plan options.
This handbook is distributed to everyone turning 65 across the entire country – by default, it has to be as general and as vague as possible. That’s why you’ll see phrases like “In most cases,” and “plans may have lower costs” and “You may need a referral.”
In order to truly know your options, we recommend meeting with a qualified insurance agent. We have excellent agents here at Medicare Allies who can pull up this year’s plans and tell you the specifics:
- Which Medicare Supplement companies have the lowest premium for you?
- Are there great Medicare Advantage options in your county?
- Is the Medicare MSA available in your state?
- Do you have $0 premium options?
- What are your expected out-of-pocket costs?
Those are answers you won’t find in the Medicare & You Handbook.
The Medicare & You Handbook Can Be a Great Resource
While there are a few faults with the Medicare & You Handbook, it’s generally really helpful!
Learn Medicare Lingo
If you’re not familiar with all the Medicare lingo, you have a handy section at the end of the handbook called “Definitions.”
That way, when you see that a doctor “accepts Medicare assignment,” you can quickly learn this just means the doctor agrees to take Medicare. Or when you see that your drug plan is making changes to its “formulary,” you’ll discover this means the list of covered drugs is changing.
Understand Medicare Supplements
Another really helpful part of this handbook is the information about Medicare Supplements. When we tell clients that all Medigap policies must offer the exact same benefits, we’re often met with a bit of skepticism.
That’s when we pull out the handbook and share the information right from the source:
“Every Medigap policy must follow federal and state laws designed to protect you, and they must be clearly identified as “Medicare Supplement Insurance.” Insurance companies can sell you only a “standardized” policy identified in most states by letters A through D, F, G, and K through N. All policies offer the same basic benefits, but some offer additional benefits so you can choose which one meets your needs. In Massachusetts, Minnesota, and Wisconsin, Medigap policies are standardized in a different way.”
This means you can switch Medicare Supplement companies to save money without losing any of your existing benefits. It also means you can price shop to find the best price without having to compare benefits – easy as can be!
Learn Original Medicare
Finally, the handbook is a great resource for learning what Original Medicare covers. Original Medicare just means Part A (hospital insurance) and Part B (medical insurance).
You can also learn helpful tips about free tests and services Medicare offers here on our blog:
- Here’s a List of Free Preventive Screenings, Tests, and Shots From Medicare
- Getting Started With MyMedicare.gov: Medicare's Free Online Portal
- Free Gym Memberships with Medicare Advantage Plans
Get Personalized Help
While the handbook is a great resource for learning about Medicare, it’s a relief to get personalized help from a human being! Reach out to us here at Medicare Allies for advice, education, and a personalized Medicare plan.
If you’re not quite ready to reach out to us yet, you can find a lot of helpful information on our blog – search by category to quickly access the content you’re interested in.
Thanks for reading, and we hope to help you with your Medicare plan!
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