Five problems with Medicare Part C

Created with the goal of improving efficiency, care and overall cost in health care, Medicare Advantage plans (also known as Medicare Part C) show uneven success. Enrollment is higher in some parts of the country, but efforts to increase the number of subscribers have met obstacles, such as a low number of contracted providers or difficulty in accessing care.

Some providers shy away from signing on to the program — in which private insurers cover Traditional Medicare services — leaving patients with fewer choices. This scarcity is inconvenient for consumers, but medical providers have their own complaints about the program. Here are five of the most common that I’ve heard as a patient advocate:

1. Traditional Medicare is Easy

Consider the “regular Medicare” process: render service, send a bill, get paid. Follow well-published, simple instructions, and your payment will land in your bank account within 14 days.

Medicare Advantage plans are less transparent, more complex and obstructive. More resources, time and manpower are needed to receive the same payment in 30 days­ — maybe.

Disputed claims, in general, are a minor reason for rejecting Medicare Advantage patients. But there is no doubt that for each appeal made to Medicare, there are dozens made to Part C carriers.

Even if the payment is eventually the same, the cost of the added paperwork, stress, processes, appeals, calls and staff time bites through any profit, quickly causing a practice to lose money.

2. Medicare Advantage is Complicated

The tedious and often-delayed authorization process for Medicare Advantage remains a major drain on resources and staff time. Losing money on that end is common.

Fee for Service or PPO plans (a misnomer as patients think providers are contracted with Medicare when in fact they are contracted with the particular plan administrator) are more widely accepted. Fewer resources or staff time are required.

Providers generally dislike HMO plans. Any service, visit or treatment requires prior authorization. This routinely takes three to five days, if there’s no emergency, and the patient must return to receive care. Schedules are burdened, diagnoses and treatments are delayed, and frustration is rampant. The exceptions are plans such as Kaiser Permanente, which is autonomous and self-contained.

Because of cost and unrelated contracts, an outside provider often must perform simple tests or labs. For example, an authorization must be requested, paperwork sent to the lab, blood drawn and reports sent to the office before the patient can be notified of results, a process that may have taken a few minutes otherwise. This waste of time causes hardship and anxiety for patients, while the added office administrative costs are not reimbursed.

I’ve worked with cancer patients whose HMO plan forced them to receive chemotherapy at home. With no way of supervising the treatment, the stress on staff, doctors and patients was crushing. Saving a relatively small amount seemed the only reason for the insurance to impose such a risky and potentially disastrous decision.

3. Unpaid Patient Balances

Unpaid bills are another element that has become important in the decision-making process of medical practices. With traditional Medicare, patients usually have a secondary insurance. Patient liability, which has grown in recent years, remains low and easily collected.

But Medicare Advantage policies often come with much higher deductibles and out-of-pocket costs. Some plans have no patient limit for certain items (chemotherapy drugs, for example), causing patients to either forgo treatment altogether or drain their savings. Without secondary insurance, many cannot afford to pay their bills, causing doctors to lose more money.

4. Unclear Policies

Traditional Medicare offers a vast range of guidelines, policies, webinars, educational materials and contact methods to help offices determine whether a specific item or treatment is covered, under what conditions, and at what price.

Commercial carriers, the administrators of Part C plans, must offer equivalent coverage. But they may dictate which treatment to order (cheaper, non-surgical or less drastic first), which drugs to prescribe, or where and how patients receive treatment. Pre-authorization requirements vary, so medical providers must call before any treatment or service can be recommended or started.

5. Unfair Patient Responsibility

If an office bills incorrectly or provides a non-covered service to a Traditional Medicare patient, it must absorb the loss. Not always so with Part C. Patients are more likely to be hit with unpaid bills, especially if they see a non-contracted provider or receive care that was not pre-approved.

These obstacles leave seniors caught in the middle. Between restricted access to medical providers, billing surprises, treatment delays, widespread confusion and impositions of all sorts, they are too often left to fend for themselves, with no way to change their plan until the following January.

If you are a Medicare Advantage patient, check and double-check your coverage and your bills. Not doing so could lead to bad and expensive surprises.

Learn more about Martine on NerdWallet’s Ask an Advisor.