Summit County seniors on Medicare Advantage plans are being forced to choose new coverage with the start of 2011 Medicare enrollment this week.A federal law passed in 2008 required all Medicare Advantage plans to have a provider network by 2011. Because most health insurance providers do not have such networks in Summit County, the only existing Advantage plans are disappearing next year.

Medicare Advantage plans came into existence in 1997 to allow Medicare recipients to receive coverage through private insurance companies instead of through the government’s original Medicare services. The plans had to include all coverage from Original Medicare, but they added additional services for a premium. As of March of this year, approximately a quarter of those eligible for Medicare were enrolled in Medicare Advantage plans, according to Kaiser Family Foundation.In urban areas where provider networks like HMOs and PPOs were already established, Medicare Advantage plans were often tethered to the networks, and enrollees were forced to stay in network for coverage or incur additional costs. In rural communities like Summit County, where few provider networks exist, Private-Fee-For-Service (PFFS) models became popular. These plans were not attached to a network and were generally accepted by any health care provider who accepted Original Medicare plans.With the new law going into effect next year, providers of PFFS plans had to either connect their plans to provider networks or drop them entirely. Most insurance providers do not have provider networks established in rural areas, and to build them can be costly. As a result, the Medicare Advantage PFFS plans – and thus all Medicare Advantage plans – have disappeared from Summit County residents’ options for 2011.Humana covers 98,000 commercial and Medicare users in Colorado and offered a Medicare Advantage PFFS plan in Summit County in 2010. The plan is no longer available due to the new law, but Humana may bring it back in 2012 if it can build a network in time.”We worked diligently to contract with local physicians, but were not able to secure PFFS contracts with large provider groups in time to submit the network choices in Summit County to the Centers for Medicare & Medicaid Services,” said Humana media relations manager Ross McLerran. “We will continue to build our network presence in Colorado and anticipate filing additional Medicare Advantage options in the state in 2012.”Humana and other companies still offer prescription drug plans in Summit County, but these are supplemental to health plans, not replacements for them.

Those who were signed up with Medicare Advantage plans through Humana, SecureHorizons and other companies must now choose from three options: Sticking with Original Medicare, adding Medicare Supplement insurance or enrolling in a Medicare Cost Plan.Original Medicare covers approximately 80 percent of normal expenses, leaving 20 percent to be covered out-of-pocket, according to Denver-based insurance agent Kate Neuschaefer, who has been hosting informative sessions throughout Summit County over the past month. Many Medicare users stay with only the Original coverage and pay additional costs out of pocket.Medicare Supplement insurance plans – also known as Medigap plans – are typically more expensive than Medicare Advantage plans, but they provide more complete coverage of the 20 percent gap, according to Neuschaefer. Medigap subscribers still use their Original Medicare plan for everything it covers, but as the name implies, they use the Medicare Supplement coverage for any additional health care services.Finally, Grand Junction-based Rocky Mountain Health Plans offers the only full Medicare health plan available in Summit County in 2011 in the form of a Cost plan. These plans were the first of their kind, and RMHP has sold the plans since 1977, according to RMHP director of Medicare sales Karen Swiat. Whereas companies that offer Medicare Advantage plans are reimbursed by the government at a set rate for each enrollee in the plan, cost plans are reimbursed based on the type of services performed.Swiat said these plans are less profitable but more stable, as evidenced by the disappearance of Medicare Advantage PFFS plans in 2011. But as a nonprofit organization, Swiat said RMHP’s first responsibility is to providing coverage, not to returning profit to shareholders.”A lot of the models used in Grand Junction are being held as examples of what works in the health care industry,” Swiat said.SDN reporter Drew Andersen can be contacted at (970) 668-4633 or drewa@summitdaily.com.