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Health Line
30-06-2025
- Health
- Health Line
What is a Medicare advisor?
A Medicare advisor is a licensed professional who can help you evaluate and select the right Medicare plan for your budget and needs. The two main types of Medicare advisors are independent insurance agents and brokers. Navigating Medicare can be confusing. However, Medicare advisors can help you understand the different parts, costs, and coverage. It is important to check their licensing before choosing which one to use. Types of Medicare advisors There are different types of Medicare advisors — the two main types are brokers and agents. Medicare brokers A Medicare broker is a licensed individual who represents multiple insurance companies. They can help you evaluate plan options. As Medicare brokers are not tied to a particular insurance company, they can help walk you through various plans from different companies to find the best one for your coverage needs and budget. Once they help you choose a plan, they will then connect you with an agent from the insurance company to help you with the enrollment process. A Medicare broker may be the best option if you are unfamiliar with the insurance companies that offer Medicare Advantage (Part C), Part D, or Medigap plans and want to compare a variety of plans. Medicare agents Medicare agents are licensed individuals who help enroll people in various insurance products, such as Medicare Advantage, Part D, and Medigap. There are two types of Medicare agents: Independent: An independent agent is a contractor who represents different insurance companies. They search for the best plans based on each client's individual needs. Captive: A captive agent is an individual who represents an individual insurance company and is required to sell only plans from that company. Federal requirements for Medicare agents hold a license in the states where they do business use approved marketing materials test and train annually on their knowledge of Medicare health and prescription drug plans agree to the scope of appointment via document or phone call before meeting with potential enrollees SHIP volunteers The State Health Insurance Assistance Program (SHIP) is a federally funded state-based organization that provides Medicare counseling and information to beneficiaries and their caregivers. SHIP counselors are all volunteers. They offer unbiased one-to-one counseling and assistance. SHIP also screens, trains, and certifies all its volunteers as Medicare experts. To contact SHIP, you can call 877-839-2675 or find your local SHIP office. Contacting Medicare You can contact Medicare directly with any questions you may have. The Medicare line is open 24/7, except for certain federal holidays. How do Medicare advisors get paid? It is rare for a beneficiary to pay a Medicare advisor anything out of pocket. Generally, Medicare advisors are paid via commission for enrollment and retention in Medicare Advantage, Part D, and Medigap plans. They may also be offered further compensation for: administrative payments for marketing bonuses for meeting enrollment benchmarks selling other health-related insurance products, such as hospital indemnity insurance other activities for plans, such as beneficiary health risk assessments The Centers for Medicare & Medicaid Services (CMS) requires that agent compensation for Medicare Advantage and Medicare Part D plans be at or below fair market value. The following table gives examples of compensation for 2025. Compensation type National maximum Medicare Advantage initial year $626 Medicare Advantage renewal year $313 Medicare Part D initial year $109 Medicare Part D renewal year $55 For each Medicare Advantage or Plan D plan renewal or switch to a new similar plan, the Medicare advisor is paid up to 50% of the fair market value. For Medigap plans, agents are given about 20% initial enrollment and 10% for each subsequent year. What to look for when choosing a Medicare advisor When choosing a Medicare advisor, there are certain criteria you may want to consider: Licenses: Be sure to check that your chosen advisor is licensed by your state insurance department, as required by CMS. Also, check to be sure they are a member of the AHIP, the national trade association for the health insurance industry. Scope of services: Consider the services an advisor offers. If you are unfamiliar with the top companies that provide Medicare plans, a Medicare broker may be a better option. If you would rather work with only one intermediary, an agent may be more suitable. Support offered: Consider whether the Medicare advisor will provide support if you have questions or run into problems after you purchase a plan. Summary Medicare advisors are licensed individuals who can help you choose and enroll in a Medicare plan. There are two main types of Medicare Advisors — brokers and agents. Each one of these can help you in different ways. You can also contact the State Health Insurance Assistance Program (SHIP) and get unbiased one-to-one counseling on Medicare issues and questions. Medicare also has a helpline that you can call or chat online with 24/7. The information on this website may assist you in making personal decisions about insurance, but it is not intended to provide advice regarding the purchase or use of any insurance or insurance products. Healthline Media does not transact the business of insurance in any manner and is not licensed as an insurance company or producer in any U.S. jurisdiction. Healthline Media does not recommend or endorse any third parties that may transact the business of insurance.
Yahoo
03-04-2025
- Health
- Yahoo
Medicare Advantage is covering more and more Americans − some because they don't get to choose
Since the mid-2000s, the Medicare system has dramatically transformed. Enrollment in Medicare Advantage – the private alternative to the traditional Medicare program administered by the government – has more than quadrupled. It now accounts for the majority of Medicare enrollment. Employers, including state government agencies, are helping drive this growth in Medicare Advantage sign-ups. The increase in people on Medicare Advantage plans burdens taxpayers and means more patients can be denied doctor-ordered care. At the same time, it is often difficult for people enrolled in Medicare Advantage to switch to traditional Medicare. Medicare insures people 65 or older and some who are younger and disabled. Attracted by lower premiums and co-pays and the promise of extra benefits, many over-65 Medicare beneficiaries are voluntarily choosing Medicare Advantage, often switching away from traditional Medicare when they're relatively young and healthy. At the same time, many private and state employers have shifted their retirement plans so that the health benefit employees have earned counts only toward Medicare Advantage plans that replace traditional Medicare. We are health care policy experts who study Medicare, including what's driving the changes in employer health care subsidies and why health care choices may be difficult for many people. As of early 2025, health care subsidies for retired state employees in 13 states don't include traditional Medicare supplement plans. The subsidies apply only to Medicare Advantage plans. In the private sector, just over half of large employers that offer Medicare Advantage have used it to replace traditional Medicare instead of offering their employees a choice. When private and state employers drop the option for the Medigap insurance that supplements rather than replaces traditional Medicare, retirees must choose a fully privatized Medicare Advantage plan or pay the full cost of a supplemental Medigap plan on their own. Medigap lowers or removes traditional Medicare's co-pays and deductibles. When a person first enrolls in Medicare, Medigap costs US$30 to $400 a month, depending on coverage and location. But in most states, it can cost more if a person switches into the plan after the first year. There are some protections for people whose employer-sponsored plans change or are canceled. Enrollees should contact their local State Health Insurance Assistance Program advisers to understand their options. Altogether, 54% of people using Medicare are now using the private Medicare Advantage program, an increase from 8 million to 33 million between 2007 and 2024. After President Lyndon B. Johnson signed Medicare into law in 1965, older Americans usually received health insurance through the government-administered traditional Medicare health insurance program. The Medigap private insurance for co-pays and deductibles was standardized in 1980. Today, a person signing up for Medicare also has, on average, more than 30 Medicare Advantage plan options – privately run alternatives to traditional Medicare and Medigap. The two largest providers, UnitedHealthcare and Humana, administered nearly half of all Medicare Advantage plans in 2024. Navigating the current Medicare system can be overwhelming, and the Medicare Advantage option is expensive for taxpayers. As policymakers continue to weigh potential reforms, it's important to understand why Medicare Advantage has become so popular, who is enrolling in Medicare Advantage, and what aspects of Medicare Advantage plans may be important to them. The bulk of Medicare Advantage's rapid growth has come from people switching from traditional Medicare into Medicare Advantage: In 2021 alone, over 7% of Americans covered by traditional Medicare switched to Medicare Advantage, but only 1.2% of those with Medicare Advantage coverage switched to traditional Medicare. This growth mirrors the privatization of Medicaid, the federal and state health insurance program for people with low income. About 74% of beneficiaries are now enrolled in private Medicaid plans. With Medicaid, people generally don't have a choice – they are usually switched to a private plan by their state governments. But for Medicare, the privatization trend is not so simple. Compared with traditional Medicare, Medicare Advantage plans are, on average, paid more by the taxpayer-funded Medicare system for covering each enrollee. Advantage plans also have more flexibility to limit their medical costs by restricting provider networks and requiring prior authorization. Some of these extra funds result in higher profits for insurers, but they also partially finance benefits that are not part of regular Medicare. These benefits include limits to out-of-pocket costs traditionally offered by the supplemental Medigap plans and dental, hearing and vision coverage that Medicare doesn't provide. In the past decade, lawmakers have introduced several bills to add this coverage, but Congress has not passed any of them. Medicare beneficiaries give many reasons for choosing their health plan. The most common reasons are different for people covered by traditional Medicare versus Medicare Advantage. Of people who have traditional Medicare coverage, 40% prefer to have more doctors and hospitals to choose from. A similar percentage of those with Medicare Advantage cite extra benefits or limits on out-of-pocket costs. These financial protections and extra benefits are important for some older adults, given high rates of poverty and economic insecurity among people who are 65 or older. Though these supplemental benefits may not be very accessible, a quarter of surveyed beneficiaries said they were a primary reason for enrolling in Medicare Advantage. An additional fifth cited lower out-of-pocket costs. Medicare Advantage plans also typically include a low-cost drug plan that people who opt for traditional Medicare pay for separately as Part D. Compared with a traditional Medicare plan that doesn't include a supplemental Medigap plan to limit premiums and co-pays, Medicare Advantage's premiums and co-pays contribute to an estimated 18% to 24% lower out-of-pocket spending. Brokers, agents and advertisements also play an important role in which plans people choose. In a survey of people who have Medicare coverage, one-third said they used an agent or broker to choose a plan. Of those living below the federal poverty line, 12% said they relied on advertising. While these sources can inform beneficiaries about the many options, many policymakers have raised concerns about misleading marketing steering people into plans that don't serve their needs. Brokers and agents may have more incentive to guide patients to Medicare Advantage because they are paid more for enrolling people in fully privatized plans than in the Medigap and Part D plans that supplement traditional Medicare. Changes in retirement benefits are also contributing to the growth in Medicare Advantage. A majority of state employee health care retirement benefits include Medicare Advantage plans. And in 13 states, the health care benefit for retired state employees does not include a choice of Medigap: Alabama, Arizona, Colorado, Connecticut, Georgia, Illinois, Kentucky, Maine, Michigan, Missouri, New Hampshire, Pennsylvania and West Virginia. In the private sector, the share of employers offering retirement health care benefits to their employees has declined since the 1990s: Only 21% of large employers offer those benefits today compared with 66% in 1988. But among private employers that still offer retirement health care benefits, those offering Medicare Advantage more than doubled between 2017 and 2024, from 26% to 56%. Just over half of large employers that offer Medicare Advantage have used it to replace regular Medicare instead of offering their employees a choice. This means that to remain in traditional Medicare, retirees would have to give up an employer subsidy that covers all or part of the Medicare Advantage premium and pay the full Medigap premium. Private employers that still offer subsidized health care insurance as a retirement benefit but offer only Medicare Advantage include IBM and AT&T. Employers cite the shift as a necessary response to rising health care costs, though many retirees have protested the trend. Medicare Advantage premiums are generally cheaper than Medigap premiums, saving employers money, in exchange for retirees potentially being denied care more often. New York City employees successfully prevented the switch. For many Medicare beneficiaries, switching to Medicare Advantage is a one-way street because most states don't offer switchers the guaranteed issue and community rating protections for Medigap supplemental coverage plans that people get when initially signing up for Medicare. These protections prevent people from being denied coverage or charged a higher price for preexisting conditions. This increased cost in most states of switching back to regular Medicare after age 66½ – especially for people with serious health conditions – may reduce the number of people who do so. But some switch despite the cost. Meanwhile, 5% of people who used Medicare Advantage plans in 2024 had to find a new one in 2025 because of a plan being discontinued. There is a silver lining, however: For the first 63 days after their coverage ends, people in failed plans can choose traditional Medicare plus a Medigap supplement with the guaranteed issue protection that in most states applies only during the first year of Medicare eligibility. Medicare Advantage growth has been particularly strong among people with low incomes and among racial and ethnic minorities. While the share of Americans enrolled in Medicare Advantage plans has grown nationwide, the program's popularity still varies geographically. Today, the share of Medicare beneficiaries enrolled in Medicare Advantage ranges from 2% in Alaska to 63% in Alabama, Connecticut and Michigan. Although an increasing share of people in rural regions have enrolled in Medicare Advantage, they are still less likely to enroll in Medicare Advantage and more likely to return from Medicare Advantage to traditional Medicare than their urban counterparts. Switching from traditional Medicare to Medicare Advantage is more common among relatively healthy people who use less health care than expected. This trend, known as 'favorable selection,' means the Medicare Advantage companies are enrolling healthier people. The Medicare system pays Medicare Advantage plans based on the expected rather than actual medical costs. This contributes to the overpayment of Medicare Advantage plans. These switching patterns suggest that among people who have illnesses such as diabetes, Medicare Advantage is potentially more appealing if they already face barriers to health care access or are in better health. These barriers are particularly common among racial and ethnic minorities in both traditional Medicare and Medicare Advantage. We believe that the Medicare Advantage program needs to be reformed. The high payments to Medicare Advantage providers have likely helped fund their explosive growth, exacerbating the financing issues that cost taxpayers US$83 billion a year. Medicare Advantage enrollment has grown particularly quickly among vulnerable populations. Many older Medicare beneficiaries are living below or near the poverty line, and a decreasing share of them are receiving subsidized retirement benefits. This has led some people to give up access to preferred providers or even treatments to spend less out of pocket on health care by enrolling in Medicare Advantage. Others who can afford extra premiums and who want more access pay extra for supplemental Medigap coverage alongside traditional Medicare. A Wall Street Journal investigation found a pattern of some Medicare Advantage patients switching to traditional Medicare when their health care expenses grew. In some ways, this resembles the tiered or 'topped-up' health care system advocated for by some economists, where people receive a baseline plan, and those who want more coverage and can afford it pay for a more generous 'topped-up' plan. Given the size and differing needs of the Medicare population, such a system can potentially be a cost-effective way to ensure health care access and financial protections. But it also creates inequalities in access, especially if the baseline plan is much worse than the 'topped-up' plan. In addition, taxpayers pay more rather than less for someone enrolled in Medicare Advantage – the less expensive baseline plan that provides less health care. They pay less for someone enrolled in traditional Medicare plus additional supplemental insurance plans – the 'topped-up' option. For Medicare to remain solvent, reforms will likely have to reduce what the federal government spends on Medicare, either by avoiding Medicare Advantage plan overpayments or making structural changes to how the plans are paid. We believe it's important that, throughout any reform, people have access to an affordable plan that ensures access to health care. Projections show that under the current payment system, reductions in payments from the Medicare system to Medicare Advantage providers would likely lead to only modest decreases in plan generosity, though given the vulnerability of many who use Medicare Advantage, this would have to be monitored carefully. It's also important for policymakers to consider improving traditional Medicare, whether that be allowing for an out-of-pocket maximum or covering at least the same degree of dental, vision or other benefits currently offered only under Medicare Advantage. This article is part of an occasional series examining the U.S. Medicare system. Past articles in the series: Medicare vs. Medicare Advantage: Sales pitches are often from biased sources, the choices can be overwhelming, and impartial help is not equally available to all Taxpayers spend 22% more per patient to support Medicare Advantage – the private alternative to Medicare that promised to cost less This article is republished from The Conversation, a nonprofit, independent news organization bringing you facts and trustworthy analysis to help you make sense of our complex world. It was written by: Grace McCormack, University of Southern California and Victoria Shier, University of Southern California Read more: GOP lawmakers commit to big spending cuts, putting Medicaid under a spotlight – but trimming the low-income health insurance program would be hard Survey shows immigrants in Florida – even US citizens – are less likely to seek health care after passage of anti-immigrant laws Taxpayers spend 22% more per patient to support Medicare Advantage – the private alternative to Medicare that promised to cost less Grace McCormack receives funding from the Commonwealth Fund and Arnold Ventures. Victoria Shier receives funding from the National Institutes of Health.
