Why Are My Out-of-Pocket Costs So High?
Q: Although my Medicare Advantage Plan did not raise premiums much over the past two years, I discovered that I had to pay considerably more out-of-pocket than I expected to this year. I have a $1,000 deducible, but my costs are already closer to $5,000. Why would this occur?
A: Three of the most common reasons that costs are higher than expected are "out-of-network" care, higher annual out-of-pocket limits, and billing errors. It's possible that you're affected by all of them.
When you receive services from an out-of-network provider that makes a significant difference to what you pay out-of-pocket. If you're in a Medicare HMO and you go out-of-network, your plan may not cover the cost of care, and you will have to pay 100 percent of the cost of your services. Depending on your plan if you are in a Medicare Advantage PPO, your plan may impose out-of-network deductibles, and charge higher co-pays. In addition out-of-network care in either may not count toward your out-of-pocket limits.
To ensure that you get the most out of your health plan, make sure that you check whether your providers participate in your plan, before your next appointment or filling the next prescription. You can use your health plan's website to find participating providers, or call the customer service number listed in the booklet that explains your health plan.
According to the Kaiser Family Foundation, which conducts annual research on Medicare Advantage plans, average out-of-pocket spending limits have been rising rapidly. These limits are the maximum amount you can expect to pay each year before your health plan covers the rest of the costs. While the Centers for Medicare and Medicaid Services recommends an out-of-pocket limit of $3,400, $6,700 is the maximum that plans can charge in 2014. According the Kaiser Family Foundation, between 2013 and 2014, the share of Medicare Advantage enrollees in plans with limits of more than $5,000 almost doubled, growing from 24 percent to 44 percent.
Healthcare billing advocates estimate that 30 to 80 percent of medical bills contain errors, but errors can sometimes be difficult to spot. Start by making sure providers have the correct Medicare number, and your most recent card from your Medicare Advantage plan. Ask doctors and your hospital for itemized billing statements, and call for explanations of charges you don't understand. Look for duplicate charges, one of the most common errors.
Resources: For questions about Medicare and Medicare Advantage plans, try www.MedicareInteractive.org. To learn more about Medicare Advantage plans in your area, check your 2014 copy of Medicare & You. Call Medicare toll free at 1-800- MEDICARE (1-800-633-4227) or visit www.Medicare.gov.
Sources: Medicare Advantage 2014 Spotlight: Enrollment Market Update, Kaiser Family Foundation, April 2014.