Medicare Advantage Plans and Medicare Secondary Payer: Part 2

Rafael Gonzalez, Esq. Cattie & Gonzalez, PLLC

If you have been paying attention to Medicare Secondary Payer issues over the last decade, then you know that Medicare Advantage reimbursement of conditional payments has been and continues to be a significant issue for primary payers in liability, no-fault, and workers compensation cases. At one point, federal courts had determined that Medicare Advantage plans were not entitled to use the Medicare Secondary Payer Act to seek reimbursement of conditional payments, but had to instead seek such recoveries at the state level based on contractual language found within each policy. That all changed in 2012 when the United States Court of Appeals for the 3rd?Circuit ruled that Medicare Advantage plans were in fact allowed to use the MSP Act to seek reimbursement of conditional payments, including seeking double damages when primary payers refused to pay back such conditional payments forcing the Advantage plan to seek legal remedy in court.

Fast forward a decade later and today Medicare Advantage conditional payments are front and center, or should be, in the MSP compliance program of every primary payer in the country. With numerous United States District Courts and several United States Court of Appeals agreeing, and with the PAID Act becoming law in December 2020, and thereafter becoming effective in December 2021, there is no longer a void in the identification of Advantage plans that may have made payments related to the liability, no-fault, or workers compensation claim, entitling them to reimbursement pursuant to the MSP Act.

Perhaps not as top of mind for most primary payers, but certainly a concern for those of us who work with MSP issues on a daily basis, is the extension of supplemental benefits or “extra benefits” such as vision, fitness, telehealth, hearing or dental benefits to the items covered by Advantage plans that are generally not available in the traditional Medicare program. As Medicare Advantage plans continue to increase their offerings to include meals, transportation, acupuncture, chiropractic, in-home support, and enrollee caregiver support services, will these extended benefits make their way to the traditional Medicare program and become reimbursable conditional payments and an expected component of the Medicare Set Aside program when taking Medicare’s future interests into consideration when settling future medical needs associated with a liability, no-fault, or workers compensation claim?

I have been talking and writing about it for more than 20 years- the privatization of Medicare. Twenty years ago, it seemed an impossible task, but over the last decade, Medicare Advantage, the private plan alternative to traditional Medicare, has taken on a more prominent role in the Medicare program. In 2022, more than 28 million Medicare beneficiaries were enrolled in a Medicare Advantage plan, nearly half of the total Medicare population. How did this happen, and why is it still going on? Why would half of the Medicare population bypass the traditional Medicare system and instead go to private group health insurance companies to obtain their Medicare coverage?

Over the next several weeks, I will be discussing various components of why this phenomenon has occurred and is predicted to continue for the foreseeable future. As always, I use Kaiser Family Foundation (KFF) studies, analysis, statistics, research, and published articles as my source for all numbers mentioned and discussed throughout. Today we focus on one of the most popular reasons Medicare beneficiaries migrate over to Advantage plans, the extra benefits offered by Medicare?Advantage plans.

Availability of Extra Benefits

Medicare Advantage plans may provide extra benefits that are not available in traditional Medicare, considered “primarily health related,” and can use rebate dollars (including bonus payments) to help cover the cost of these extra benefits. Beginning in 2019, CMS expanded the definition of “primarily health related” to allow Medicare Advantage plans to offer additional supplemental benefits. Medicare Advantage plans may restrict the availability of these extra benefits to certain subgroups of beneficiaries, such as those with diabetes or congestive heart failure, making different benefits available to different enrollees.

In 2023, more than 97% of individual plans offer some vision, fitness, telehealth, hearing or dental benefits. Though these benefits are widely available, the scope of coverage for these services varies. For example, a dental benefit may include cleanings and preventive care or more comprehensive coverage, and often is subject to an annual dollar cap on the amount covered by the plan. Plans are not required to report data about utilization of these benefits or associated costs, so it is not clear the extent to which supplemental benefits are used by enrollees.

As of 2020, Medicare Advantage plans have been allowed to include telehealth benefits as part of the basic benefit package, beyond that which was allowed under traditional Medicare prior to the Covid-19 public emergency. These benefits’ costs are built into the Advantage plan’s bid and are not covered by either rebates or supplemental premiums. Additionally, Medicare Advantage plans may offer supplemental telehealth benefits via remote access technologies and/or telemonitoring services, which can be used for those services that do not meet the requirements for coverage under traditional Medicare or the requirements for the telehealth benefits as part of the basic benefit package (such as the requirement of being covered by Medicare Part B when provided in-person). The vast majority (97%) of Medicare Advantage plans are offering telehealth in 2023.

Other extra benefits that are frequently offered in 2023 include over the counter items, such as adhesive or elastic bandages (87%), meal benefits, such as meal delivery (71%), and transportation benefits (43%). Ten percent of plans offer access to bathroom safety devices (10%), while 4 percent offer support for caregivers of enrollees or telemonitoring services (3%). This is not an exhaustive list of extra benefits that plans offer, and plans may provide other services such as home-based palliative care, therapeutic massage, and adult day health services, among others.

Availability of Medicare Advantage Plans with Extra Benefits?

Virtually all Medicare beneficiaries live in a county where at least one Medicare Advantage plan available for general enrollment has some extra benefits not covered by traditional Medicare, with over 99% having access to at least one or more plans with dental, fitness, vision, and hearing benefits for 2023. The vast majority of beneficiaries also have access to one or more plans that offer telehealth benefits (over 99%), over the counter items (99%), a meal benefit (99%), transportation assistance (98%) but fewer have access to one or more plans that offer in-home support services (87%), bathroom safety devices (70%), or caregiver support (42%).

Special Needs Plans (SNPs) are designed to serve a disproportionately high-need population, and a somewhat larger percentage of SNPs than plans for other Medicare beneficiaries provide their enrollees transportation benefits (88%) and in-home support services (34%). Similar to plans available for general enrollment, a relatively small share of SNPs offer support for caregivers (5%) or telemonitoring services (4%).

Beginning in 2020, Medicare Advantage plans have also been able to offer extra benefits that are not primarily health related for chronically ill beneficiaries, known as Special Supplemental Benefits for the Chronically Ill (SSBCI). Information on the availability of SSBCI for 2023 has not yet been published by CMS, but in 2022,?fewer than half of all SNP enrollees were in plans that offered some SSBCI. The share of Medicare Advantage enrollees who had access to SSBCI benefits is highest for food and produce (9.6% for individual plans and 35.1% for SNPs), meals (beyond a limited basis) (7.8% in individual plans and 17.3% for SNPs), transportation for non-medical needs (6.5% for individual plans and 20.5% for SNPs), and pest control (6.4% for individual plans and 18.9% for SNPs).

About Rafael Gonzalez?

Rafael earned his Bachelors of Science degree from the University of Florida, and his Jurisprudence Doctorate degree from the Florida State University.?

Rafael has over 35 years experience in the legal and insurance industries. He is currently a partner in Cattie & Gonzalez, PLLC, a national law firm serving clients in all 50 states, focused on Medicare and Medicaid secondary payer law and compliance in auto, bodily injury, liability, mass tort, medical malpractice, nursing home, no-fault, products, workers compensation, and wrongful death claims and litigated cases.?

Rafael writes and speaks about workers compensation, social security, medicare, medicaid, marketplace, mandatory insurer reporting, conditional payments resolution, set aside allocations, msa and snt administration, social determinants of health, and diversity, equity, and inclusion throughout the country.?

Rafael can be reached at 844.546.3500 or at [email protected]. You may also reach out to him on social media, as he is active on linkedin, twitter, facebook, instagram, and youtube.?