RALEIGH — Bonnie Lee Smith, a retired medical imaging technician, should have plenty of health-insurance coverage: She qualifies for Medicare because of her age and for Medicaid because of her income.
But Smith, 81, says she has had no primary physician since her previous doctor's office said it won't accept her coverage under a privately run Medicare plan.
"I'm just trying to figure my way through the maze," said Smith, a stomach-cancer survivor.
Evercare, the plan that covers Smith, is one of about 50 Medicare Advantage policies offered by insurance companies in North Carolina. These plans, which cover about one in five Medicare recipients, replace traditional Medicare and usually offer additional coverage such as dental, vision or fitness benefits.
But nationally, Medicare Advantage plans are the subject of fierce debate as Congress attempts to craft a health-care reform bill. Supporters say they offer extra benefits that seniors love, and opponents call the average 14 percent extra they cost per recipient a giveaway to insurance companies. State regulators say people with Medicare Advantage insurance have often had problems finding doctors and hospitals to take the coverage.
The Senate Finance Committee plan under debate last week would cut more than $120 billion in subsidies to the plans beginning in 2011.
In his Sept. 10 health-care address, President Barack Obama called Medicare Advantage plans "unwarranted subsidies in Medicare that go to insurance companies -- subsidies that do everything to pad their profits and nothing to improve your care."
Republicans in Congress oppose Obama's plan to cut the subsidies, citing the many Medicare recipients who choose the plans. They describe attempts to cut subsidies as paying for reform "on the backs of seniors."
Insurance companies say Medicare Advantage brings greater choice to recipients and competition to the market. Sen. Richard Burr said in a recent letter to constituents that he "cannot accept cuts to Medicare Advantage," which he called an extremely popular program.
A June analysis by the Medicare Payment Advisory Commission, an independent body set up by Congress to monitor the federal insurance program, found there's no proof that the plans serve recipients better than traditional Medicare.
"Although plans are being paid more, the extra payments do not necessarily result in higher quality of care," the agency, known as MedPAC, said in the report.
In North Carolina, insurance regulators have dealt with more than 750 complaints about the plans since 2006. About 45,000 people across the state have Medicare Advantage plans as their only coverage; more have it in combination with prescription drug plans.
"We've had complaints about all the [Medicare Advantage] plans," said Carla Obiol, deputy commissioner of the state's Seniors' Health Insurance Information Program.
Plan sounded good
Smith remembers that she signed up for Evercare when a saleswoman visited her apartment complex in North Raleigh. Smith says she didn't take note at the time that signing up for a Medicare Advantage plan held no guarantee that her current physicians would accept the coverage. Details of the coverage were difficult to understand, but the saleswoman made it sound attractive, she said.
"A lot of mathematics are involved, and that's not my strong point," she said.
Confusion among seniors about Medicare Advantage plans is common, Obiol said.
"It's not so much that the product doesn't provide benefits, but that their [health-care] providers don't accept the product," Obiol said.
Jon Stone, a spokesman for Evercare's parent, Minnesota-based United HealthCare, said the company "takes numerous steps before, during and after the enrollment process to verify that each member understands all aspects of the plan that he or she is joining."
Stone cited a new industry study of Medicare Advantage participants in 2006 in California and Nevada who spent less time in the hospital and were readmitted less often that their counterparts on traditional Medicare.
But United Healthcare and its North Carolina subsidiary have paid more than $3 million in fines and penalties to the state Department of Insurance in the past five years to settle issues such as claims management and explanation of benefits. As part of the settlements, the company did not admit to violating any laws or regulations.
Deciding among the available public and private Medicare plans is daunting, involving weighing different levels of benefits and charges among dozens of documents.
"A huge problem for the senior community is that there are so many Medicare programs for them to choose from," said Sylvia Harlen, a geriatric care manager in Raleigh. "Part of the dilemma of the elderly is that they are overwhelmed by the information that's available."
Said Smith: "I've heard even medical people say it is hard for them to keep things straight."
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