Health systems dropping Medicare Advantage pose a new enrollment challenge

Many people on Medicare look the other way when the program’s annual enrollment period rolls around, preferring simply to ignore the hassle. But for thousands of seniors in San Diego, Medicare enrollment this year has become a confusing scramble to find new insurance - or new health providers.

Scripps Health, a major Southern California healthcare provider, announced in September that beginning next year, its popular clinic and coastal medical groups will no longer accept patients enrolled in Medicare Advantage, the managed-care alternative to traditional Medicare offered by commercial insurance companies. That has left 32,000 San Diego seniors scrambling to find either new healthcare options or new insurance for 2024.

And Scripps is not alone - at least a half-dozen other health systems around the U.S. are terminating Advantage contracts, according to Becker’s Hospital CFO Report. Along with the health systems mentioned in that report, University of North Carolina Health recently warned 200,000 patients that it may drop UnitedHealthcare’s Advantage plan next year.

Medicare’s annual enrollment period is under way, and it ends on Dec. 7. If you are enrolled in traditional Medicare (Parts A and B) paired with a Medigap there is no need to review that coverage. But Part D prescription drug or Medicare Advantage coverage should be reviewed. This also is the time when you can move between Advantage and traditional Medicare.

Medicare Advantage enrollment has grown quickly over the past decade, partly due to its all-in-one features and lower upfront costs. Most Advantage plans include prescription drug benefits, and they are not used alongside supplemental Medigap policies, which cover out-of-pocket costs and can be expensive. Like all Medicare beneficiaries, Advantage enrollees pay their Part B premium, and they are on the hook for out-of-pocket costs up to a pre-set annual ceiling.

But the Scripps Health decision underscores an important downside to Medicare Advantage plans: there is no guarantee that you will be able to stick with your preferred doctors and hospitals. Medicare Advantage plans can drop healthcare providers from their networks - and that happens when providers and insurers cannot agree on contract terms.

The Scripps decision marks a new twist: healthcare systems deciding to drop out of Medicare Advantage. This inherent provider instability means that the choice between traditional Medicare and Advantage is not just financial - it is also a critical consideration for your health and quality of life.

Learn more in my latest column for Reuters. And here’s a story from NBC News on how Advantage plan denials of care are harming rural health systems.

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