IBM Medicare Via Benefits Medicare Advantage Maximum Out of Pocket Cost

I write a lot about Medicare Advantage plans because they are complex but are presented as a comprehensive and simple one-stop shopping alternative to original Medicare.

This post is focusing on the MAXIMUM out of pocket (MOOP) cost you might pay using a Medicare Advantage plan if you are seriously ill.  MOOP is an accumulation of all your payments, excluding premium payments, for a given year.

It is rare that this aspect of Medicare Advantage plans is mentioned or truly explained by the company or an insurance agent.  It is often referred to as a cap and not MOOP. It needs to be an important part of your selection criteria if you are considering one of these plans.

The federal government determines the maximum MOOP number and it is current set at $6,700. However, your actual maximum can go as high as $13,400 a year.  It is up to the insurance company where to set the MOOP but it never can be higher that $6,700 for in-network providers. To be fair, there are plans where the MOOP is $0.  They are more restrictive plans such as HMOs where you cannot go out of network and in-network is a small set of doctors.

It is important to realize that if  your plan does include an in-network and out-of-network option and you go to an out-of-network provider, your payment to the provider might not count toward an in-network MOOP.  It depends on the insurance plan.  Some plans have two numbers, meaning there is an in-network MOOP and an out-of-network MOOP.

I just saw a plan yesterday that had two categories and each category was set at $5000.  That means if the policy holder was very sick, they could end up paying a whooping $10,000 out of pocket in 2019 plus pay a premium of $103/mo.  Ergo, the MOOPs + premium cost could top out at $11,236/year!!!

How the blazes does that happen?  When you are seriously ill, the cost sharing in Medicare Advantage plans changes.  For example, your copay might be significantly higher than in original Medicare if you need home care. Insurance companies never talk about that.

Here is my bottom line on all of this.

A Medicare Advantage plan can be significantly more expensive than original Medicare if you get sick and has the potential of costing $13,400 in 2019 and you cannot buy a secondary insurance policy to cover that cost. There is no regulated MOOP for out-of-network services - see update below.
 
Original Medicare with my current F high deductible plan ($93/mo in my zip code) guarantees I will never pay more than $1116 in premiums and $2300 in F HD deductible in 2019.  So my Original Medicare + FHD policy premium + FHD "MOOP" is $3,416.  AND I can go to any Medicare doctor anywhere in the USA without needing a referral or worrying about networks.

I think that says it all.

Updated 5/31/2019

Today I helped someone who's parent had a Medicare Advantage PPO plan, was scheduled for cataract surgery as a hospital outpatient and was informed they had to pay a $1000 deductible and a $350 fee prior to receiving treatment. 

The plan was structured to have very low cost (in copays and no monthly premium) as long as the person had minimal health issues.  The parent didn't realize there was a $1000 deductible if she needed to use the hospital as an outpatient.  When I looked at a more detailed description, there was a $675 deductible for inpatient admission (and nothing said about how often that deductible had to be paid such as one a year, once a quarter, for every admission and a $500/day copay after day 20.  There was also a $6,700 in-network MOOP and a $10,000 out-of-network MOOP.  Ergo the parent might face an annual cap of $16,700 because apparently the out-of-network MOOP is not regulated!

It's a pathetic decimation of  the promise of Medicare insurance to protect the elderly from overwhelming medical cost and the federal government is enabling this by actively "pushing" Medicare Advantage plans.