Air conditioners for people with asthma, healthy groceries, rides to medical appointments and home-delivered meals may be among the new benefits offered to Medicare beneficiaries who choose private sector health plans, when new federal rules take effect next year.
The Centers for Medicare & Medicaid Services (CMS) last week expanded how it defines the “primarily health-related” benefits that private insurers are allowed to include in their Medicare Advantage policies. And insurers would include these extras on top of providing the benefits traditional Medicare provides.
“Medicare Advantage beneficiaries will have more supplemental benefits, making it easier for them to lead healthier, more independent lives,” said CMS Administrator Seema Verma.
Of the 61 million people enrolled in Medicare last year, 20 million opted for Medicare Advantage, the privately run alternative to the traditional government program. Advantage plans limit members to a network of providers, and similar restrictions may apply to the new benefits. In California, 40 percent of Medicare beneficiaries have joined Medicare Advantage.
Many Medicare Advantage plans already offer some health benefits not covered by traditional Medicare, such as eyeglasses, hearing aids, dental care and gym memberships. However, the new rules, which the industry sought, will expand that list significantly, adding more items and services that are not directly medical.
CMS said the insurers will be permitted to provide care and devices that prevent or treat illness or injuries, compensate for physical impairments, address the psychological effects of illness and injuries, or reduce the need for emergency medical care.
Expanded how it defines the “primarily health-related” benefits a new concept. In California, for example, the Institute on Aging, a nonprofit, offers social, psychological and health-related services for seniors and adults with disabilities. It has helped people in San Francisco and Southern California move from nursing homes back to their own homes, and it provides a variety of services and goods — from kitchen supplies to wheelchair ramps — that help improve their quality of life.
“By taking a more integrated approach to address people’s social and health needs, we have seen up to a 30 percent savings in health care costs compared to the costs of the same individuals before they joined our program,” said Dustin Harper, the institute’s vice president for strategic partnerships. The agency serves 20,000 Californians a year, including former nursing home residents who qualify for Medicare, the federally funded health insurance program for seniors, or Medicaid, the federal-state program for low-income people — or both.
The institute also provides a number of other innovative services. Volunteers and staff members answer calls to its toll-free, ’round-the-clock Friendship Line (800-971-0016), which is intended to combat social isolation and loneliness. In partnership with the city and county of San Francisco, the institute also offers subsidized home care for a small group of low- and middle-income people who don’t qualify for other assistance and could not otherwise afford it.
The organization also runs one of California’s 38 Multipurpose Senior Service Program sites, providing Medicaid-funded, home-based care. Some 33 social service organizations are MSSP providers, including the Partners in Care Foundation in Los Angeles, which operates four sites. About 2 million older adults and people with disabilities rely on Medicaid for home-based services to live at home for as long as possible.
Although Medicare Advantage insurers are still in the early stages of designing their 2019 policies, some companies have ideas about what they might include. In addition to transportation to doctors’ offices or better food options, some health insurance experts said additional benefits could include simple modifications inside beneficiaries’ homes, such as installing grab bars in the bathroom, or aides to help with daily activities, including dressing, eating and other personal care needs.
“This will allow us to build off the existing benefits that we already have in place that are focused more on prevention of avoidable injuries or exacerbation of existing health conditions,” said Alicia Kelley, director of Medicare sales for Capital District Physicians’ Health Plan, a nonprofit serving 43,000 members in 24 upstate New York counties.
Although a physician’s order or prescription is not necessary, the new benefits must be “medically appropriate” and recommended by a licensed health care provider, according to the new rules.
Many beneficiaries have been attracted to Medicare Advantage because of its extra benefits and the limit on out-of-pocket expenses. However, CMS also cautioned that new supplemental benefits should not be items provided as an inducement to enroll.
The new rules “set the stage to continue to innovate and provide choice,” said Cathryn Donaldson, of America’s Health Insurance Plans, a trade group.
“CMS is catching up with the rest of the world in terms of its understanding of how we keep people healthy and well and living longer and independently, and those are all positive steps,” said Ceci Connolly, chief executive officer of the Alliance of Community Health Plans, which represents nonprofit health insurance plans. Some offer non-emergency medical transportation, low-cost hearing aids, a mobile dental clinic and a “grocery on wheels,” to make shopping more convenient, she said.
UnitedHealthcare, the largest health insurer in the U.S., also welcomes the opportunity to expand benefits, said Matt Burns, a company spokesman. “Medicare benefits should not be one-size-fits-all, and continued rate stability and greater benefit design flexibility enable health plans to provide a more personalized health care experience,” he said.
But patient advocates including David Lipschutz. senior policy attorney at the Center for Medicare Advocacy, are concerned about those who may be left behind. “It’s great for the people in Medicare Advantage plans, but what about the majority of the people who are in traditional Medicare?” he asked. “As we tip the scales more in favor of Medicare Advantage, it’s to the detriment of people in traditional Medicare.”
The details of the 2019 Medicare Advantage benefit packages must first be approved by CMS and will be released in the fall, when the annual open enrollment begins. It’s very likely that all new benefits will not be available to all beneficiaries since there is “tremendous variation across the country” in what plans offer, said Gretchen Jacobson, associate director of the Kaiser Family Foundation’s Program on Medicare Policy. (Kaiser Health News, which produces California Healthline, is an editorially independent program of the foundation.)
In addition to next year’s changes in supplemental benefits, CMS also noted that a new federal law allows Medicare Advantage plans to offer benefits that are not primarily health-related for Medicare Advantage members with chronic illnesses. The law and the agency’s changes are complementary, CMS officials said. They promised additional guidance in the coming months to help plans differentiate between the two.
This article was written with the support of a journalism fellowship from New America Media, the Gerontological Society of America and the Silver Century Foundation.