Twice, between December 20 and December 30, I received automated calls encouraging me to review my options for medical coverage – options that would take me off ‘original Medicare’ and pass control of my healthcare to a Medicare Advantage or Medicare Supplement provider. An insurance company.
This might not have been quite so annoying – though I hate automated/robo calls – if it weren’t for the fact that the annual ‘open enrollment period’ for switching from one to another option to original Medicare ended on December 7.
There are three issues here:  Why are automated calls to potential clients allowed?  Why am I getting calls at a time, as one well over 65, and primarily limited to switching from one plan to another during the October 15-December 7 open enrollment period, I am only eligible to switch plans under certain, very specific conditions; and  Why are Medicare-eligible individuals limited to when they can switch from one alternative to ‘original Medicare’ to another?
Aside from those questions, there is a far greater, more-far-reaching one: Why on earth are Medicare and its alternative so outrageously complicated?
I was a licensed insurance agent for perhaps ten years. I allowed my license to expire a year ago. One of the reasons I did so was because I am not and never have been a good test-taker. And every year, agents wishing to sell alternatives to original Medicare must devote two, three or more full work days to studying the year-to-year changes in Medicare’s rules and those of plans you wish to sell.
I don’t have, and I suspect it would be impossible to learn, how many millions of taxpayer dollars are wasted annually on Medicare (and alternative) program changes that seldom if ever benefit consumers.
Sadly, there is a simple answer why Medicare employees, representatives at several levels in insurance companies, and insurance agents are put through this dog-and-pony show: Insurance companies seek the complications, because in many cases they make it easy to deny claims, because a claimant hasn’t followed every esoteric rule of the year.
Insurance companies spend huge amounts of money every year lobbying Congress for Medicare rule changes for the simple reason that they want premium-collecting to be as easy as possible and payout – claims – rules to be so complicated, so nearly unfathomable, that many people simply don’t try fighting ‘the system.’ It, the system, is totally rigged against them.
Insurance companies spend many hundreds of thousands of dollars annually rewarding agents with trips to exotic locations – trips that, truth be told, should be reported by agents as unearned income. (Chances are, though, that the insurance companies’ lobbyists have manipulated the tax laws to render such reporting unnecessary.)
Those trips are fully subsidized by insurers’ premiums.
The open enrollment period scam – and it is a scam: there is absolutely no logical reason for its existence – is not only totally illogical, it is enormously costly to the federal government, which insists that anyone wanting to switch from one Medicare Supplement or Medicare Advantage plan to another must do so within the period that last year ran from Oct. 24 through Dec. 7.
In 2012, there were a total of 49.6 million Medicare recipients, according to the Kaiser Family Foundation. In 2013, the number of total beneficiaries was up to 52.3 million, according to the National Committee to Preserve Social Security and Medicare.
For an extremely conservative estimate, let’s assume that only one percent of Medicare recipients, in either of those two years, chose to switch from one plan to another. Some would, of course, make the switch early in the open enrollment period. Others, though, would dawdle, and not switch until the last minute. However the switching happened, Medicare, in the person of the Centers for Medicare and Medicare Services, would have had to check all the figures on all the forms and get all the changes put into place by the start of the new benefit year – January 1.
From October 30 to December 31 last year, including the day after Thanksgiving, there were a total of 42 business/working days to process, in 2012, 496,000 applications, and 523,000 in 2013. How many extra staffers had to be brought on board to process, in 2012, some 11,810 applications on each of those working days?
The insurance companies selling those policies had precisely the same problem – processing an enormous number of apps in an unreasonably short period of time.
And the point of forcing that rush-pace effort (a sure way to ensure mistakes) is . . . what?
Could the ‘logic’ behind this system be as simple as, this is a good way to incentivize licensed agents to bust their butts, for a few weeks, with a carrot-and-stick suggestion that, by so doing, they will sell lots of policies, and make lots of commission money?
Agents who put themselves through that had better make good money (thought many don’t) during those weeks, because before the start of the open enrollment period, each of them had had to dedicate the better part of an unpaid work week to studying the changes and having their knowledge tested, before they could be ‘appointed’ to deal, in that particular year, with Medicare-related ‘products’. (‘Next, the entire studying/testing routine is done again.)
The saddest thing is, only a relatively small number of changes to Medicare regulations or to individual plans serve to benefit, in any significant way, Medicare recipients.
Someone – some group of someones, in the form of a Congressional Committee – needs to take a hard look at the shear waste the open enrollment period.
And the mind-boggling complexity of Medicare rules and regulations: This is a public program designed to serve primarily people 65 and older – an age where one’s faculties begin to fail, when one’s ability to make sense of complex language and terminology decreases dramatically, by the week or month, for many people.
Every Medicare recipient receives a new version every year of the book ‘Medicare And You’. The 2016 version weighs just shy of 12 ounces. (Each Medicare Advantage program produces a nearly-as-thick book every year for its new and ongoing clients.)
Imagine the labor that goes into producing a book whose 12 ounces actually consumes, across the 52.3 million distributed copies, more than 1960 tons of paper, ever year!
And only a miniscule share of those receiving ‘Medicare And You’ make much (if any) effort to make sense of what’s telling them!
Nineteen hundred and sixty tons of paper may not sound like a lot, but think of the tens of thousands of work hours – and taxpayer dollars – that go into producing something too complex for all but a very few to spend, literally waste, time on.
Then there the tens (hundreds?) of millions of dollar being wasted by insurance company lobbyists and staffers – not to mention Congressional staff time – to generate a work that is, largely, useless.
These are hugely complicated programs that, if ‘fixed’ in ways suggested here, would undoubtedly have an economic impact on budget costs (positively), lobbyists (negatively) and insurance companies (ultimately, positively).
But as seems to be the case in a number of other areas – defense costs being a prime example – lobbyists have such a tight grip on the system it’s unlikely to change.