Thursday, December 30, 2010

Health Care Advertisements

Health Care Plan Advertisements: Let The Buyer Beware

All around us - on television, on the radio, and on the internet when we’re browsing - there are advertisements for health care plans. Some specifically relate to changes in health care mandated by the new Patient Protection and Affordable Care Act (PPACA), while others are generic advertisements, not new in their message, but only in their graphics. Be wary of these commercials, for no matter how glitzy they may be, their primary purpose is to sell rather than to inform.

In looking into the issue of advertisements, AH Insurance Services reviewed specific promotional materials from Aetna and United Healthcare. We were hoping to encounter easy-to-understand sound bites that would summarize the new benefits mandated by health care reform and explain the impact of these benefits on plan premiums. What do you suppose we found?

Well, we found lots of information - but not all of it clear-cut - and much of the relevant information is buried from the consumer.

Aetna, for example, provides real information about the impacts of PPACA on health insurance plans via their Homepage, but first you must search for “health care reform” and then sort through material provided in a long list of URLs. When it comes to Aetna’s advertisements, it’s difficult to discern what is true from what is mere embellishment without having prior knowledge about health care reform provisions. Aetna’s advertisements promote new benefits as innovative plan features, when in reality these benefits are mandated by PPACA. So even though Aetna makes their plan options sound original, consumers will find them available with every new health plan.

United Healthcare uses advertisements that emphasize consumer satisfaction and security. That’s all fine, but what about explaining the health plan changes and quantifying any extra costs? United Healthcare’s visual pieces, such as the advertisement to the left, emphasize the importance of obtaining a health care plan, and merely give assurance of protection. Radio commercials by United Healthcare, such as those found on United Healthcare's National Advertising website, also emphasize the protection that having health insurance provides, while giving little factual information on new health benefits.

We see on United Healthcare's National Advertising website video advertisements in which consumers give their impressions of the health care they purchased for their small businesses. Once again, these give little information about what the actual benefits and costs are, but they do give four essential tips to purchasing health insurance:

1. Look at the benefits

2. Compare prices

3. Research the quality of service

4. See if your doctors are covered

Do not be lulled by non-informative advertisements containing fantastic consumer reviews. We all pay mind to good testimonials, but it would be foolish to think that insurance companies use a random sample to choose which reviews will be shared with the public. We suggest listening closely to the reviews, and then doing due diligence to confirm their integrity.

Even though a company may include little information in its advertisements, its products are not necessarily inferior. The key is to do your research, either by yourself or with a trusted independent insurance agent. Make sure you weigh the benefits and potential shortcomings of each plan, and compare premiums with several competitors. Sometimes, quoted rates vary substantially between companies, but that may not tell the full story as the company with lower quoted rates might employ much more stringent medical underwriting. Currently, it’s still permissible for health insurance companies to charge a higher premium, impose exclusions for pre-existing conditions, or outright deny adult applicants based on their medical history.

While we didn’t specifically review any of Humana’s advertisements for this post, we should mention that we haven’t noticed any mention in the media yet of the new lower new business premium rates Humana will be rolling out on January 2nd on its Florida “HumanaOne” individual health product. Lower rates - now that’s an expression you don’t hear very often. Perhaps in this case, you heard it from us first!

For a summary of the changes to health care plans mandated by the PPACA, please visit our prior blog posts titled New PPACA Provisions I and New PPACA Provisions II.

Until next year,

Andrew Herman

AH Insurance Services, Inc.

Monday, December 13, 2010

The New Medicare Advantage Disenrollment Period (MADP)


January 1 through February 14

New for 2011, the Open Enrollment Period (OEP) has been replaced with the Medicare Advantage Disenrollment Period (MADP). Medicare beneficiaries can no longer make a switch in their Medicare Advantage plan during this period; however members may disenroll from Medicare Advantage and return to Original Medicare.

Medicare Advantage customers with prescription drug coverage as of the beginning of MADP should take note of the following:
  1. If you are enrolled in a Medicare Advantage plan that includes prescription drug coverage, you may be able to return to Original Medicare (plus any stand-alone drug plan, or none).
  2. If you are enrolled in a Private Fee-for-Service (PFFS) Medicare Advantage plan plus a stand-alone drug plan, you may be able to return to Original Medicare (keeping the same drug plan or dropping it).
  3. If you are enrolled in a Private Fee-for-Service (PFFS) Medicare Advantage plan that includes prescription drug coverage, you may be able to return to Original Medicare (plus any stand-alone drug plan, or none).
If you want to disenroll, the plan must accept your disenrollment request so you can return to Original Medicare; however, Medicare beneficiaries on non-PFFS Medicare Advantage plans will be automatically disenrolled upon their enrollment into a stand-alone drug plan during the MADP.

Please be aware that if you chose to disenroll and you choose not to enroll in a prescription drug plan, you may have a late enrollment penalty if you choose to enroll in a prescription drug plan in the future.

If you disenroll during the MADP, your disenrollment will be effective on the first day of the month following receipt of the disenrollment request.

If your situation doesn't fall into one of the three categories above, please don't hesitate to Contact Us.