Joanne: Have you seen Medicare advertisements on TV or online or in the mail that promise benefits that just seem too good to be true? Well, based on where you actually live, they might be. And so in today's episode, we will be explaining how where you live will impact your Medicare 

Cameron: coverage options. But before we start, my name is Cameron Giardini, and together with my co-host Joanne Giardini Russell, we operate Giardini Medicare, which is an independent insurance agency based out of southeast Michigan.

Although we are based in Michigan, we work virtually over the phone to directly help consumers in about 13 states to find the right Medicare coverage for them. If we do not work in your state, we will connect you with another trusted, independent agent that will be able to help you find the coverage that you want.

We also now have a free online course available for you to register for, and you can learn more about all of these Medicare topics by going online and going to gmedcourse.com, which is gmedcourse.com. So a brief overview of today's episode, we will give an overview of Medicare Advantage and Medigap plans as well as Part D just to kind of refresh your memory and talk more about those topics later on.

We will then go over the geographic statistics and really what you should know based on different locations in the country about Medicare Advantage, Medicare Supplements, and Part D. We'll give you our thoughts on how you can better navigate these differences based on geography between these different coverages.

And then lastly, of course, we will recap what you should know about the geographic differences when it comes to Medicare. So first, here is a brief overview of what Medicare Advantage plans are. It's always good to remember this so we can go over these in more detail throughout the episode. Medicare Advantage is also known as Part C.

It is a private alternative to Original Medicare that bundles all of the benefits of Part A. Part B and typically Part D all into one package. These are managed care programs. They are offered by private insurance companies, and they typically come in the form of HMOs or PPOs, which require the use of specific networks of providers and hospitals, and they might require prior authorization before getting medical care, and Medicare Advantage plans.

They typically have low monthly premiums, and they provide extra benefits, not covered by original Medicare. According to Medicare.gov, while enrolled in a Medicare Advantage plan, you'll get most of your services for Part A and B coverage through your Medicare Advantage plan instead of through Original Medicare.

So just to go back real quick, I know I said at the beginning this is often called Part C, but it's always good to remember this is not an actual part of Original Medicare. It's an alternative as I just mentioned. But now, shifting gears completely, Joanne will talk about Medigap and Part D as an overview.

Joanne: So, we have Medicare supplements, which are also called Medigap plans, and these plans, they are sold by private insurance companies, and they're designed to fill the gaps left by Original Medicare, and they'll cover the 20% cost-sharing that Original Medicare does not cover. These plans allow policyholders to see any provider that accepts Original Medicare, and they rarely will ever require prior authorization.

Medigap plans typically are going to have higher monthly premiums, but lower potential out-of-pocket medical costs compared to Medicare Advantage plans, and they do not usually provide extra benefits that are not covered by Original Medicare. Medigap plans are standardized by their plan letters, and the plan letters range from A through N.

Now, Part D. Part D provides coverage for most outpatient prescriptions that you're going to be filling at a pharmacy. Part D is not a part of Original Medicare, meaning Part A or Part B, but it's instead provided through private insurance companies that contract with Medicare to offer what are considered Part D plans.

Although these plans are provided by private companies, according to the Center for Medicare Advocacy, these companies are both regulated and subsidized by Medicare. To be eligible for a Part D plan, you must be enrolled in Part A and or Part B of Medicare and be a resident of the county or the service area where that Part D plan is offered

Cameron: So again, that was just an overview to remember what Medicare Advantage, Medigap plans, as well as Part D plans, are. And now, we will talk about how your geography and where you live can impact your Medicare options and everything we just discussed. First, we'll start with the geographic impact on actual Original Medicare, which again is Part A and Part B.

So unlike many Medicare coverages, where you live, it doesn't have as much impact on your actual Original Medicare benefits. Original Medicare has the same standard premiums, deductibles, coinsurance, and copays across the country. For example, in 2023, the monthly base premium for Medicare Part B is $164.90/month, and the Part B deductible is $226 for the year.

And then also Part B has a 20% coinsurance, which is just a fancy way of saying you have to pay out of pocket 20% for medical services covered by original Medicare. You may pay more for Medicare premiums due to what we have talked about in the past, which is IRMA. But that is income related, and it is not geography related.

So go to those episodes about Irma, if you want to learn more about that. Now, a couple of things that can impact Original Medicare based on where you live are the fee schedules. Original Medicare, it is known as a fee-for-service program. You don't need to know it technically, but at a basic level, this means that providers are paid a set fee for the services they provide.

 These payments can vary by state and even county. For example, in one county, a procedure might have a fee of $110. And it might be $100 in another county. So if you have original Medicare, although the 20% is standard, so everyone's paying 20%, the amount that the 20% becomes can vary based on where you live.

Because, again, these fees can change. Now, a lot of times, you'll either enroll in a Medicare Advantage or a Medigap plan, so that won't matter. But just technically speaking, this is different with Original Medicare in different places. And then second, the participating versus non-participating provider equation or prevalence that can change based on where you live.

So although a large majority of doctors accept Medicare and are participating providers, there are parts of the country where certain clinics or locations may have more non-participating providers. In this case, they can charge excess charges. But to learn more about that topic, make sure to check out our Medigap episodes that cover that in much more detail.

And there are also mom states out there, which is not your mother, but it is the Medicare overcharge measure state. Basically, these states are where excess charges are not allowed so if you are in one of those states, that can shift the equation when you're wondering about participating or non-participating providers. Now, shifting from original Medicare and its differences across states or across counties, let's talk about what's probably more important to you, and let's start with Medicare Advantage and how those plans can vary from one area to the next.

Joanne: For the following information, the statistics we're using are going to be from data from the latest Kaiser Family Foundation Medicare Advantage landscape report, as well as a Milliman white paper about the urban versus rural divide of Medicare Advantage plans, so we're going to link to both of those in the show notes.

So first, let's discuss plan availability. Medicare Advantage plan availability is based on the county that you live in. So in 2023, the average beneficiary can choose from 43 Medicare Advantage plans in their county, double the 2018 availability number. So this can range from zero plans available in parts of Alaska, Colorado, Nebraska, Idaho, and others, all the way to 80-plus plans that are available in some counties in Ohio.

The vast majority of Medicare Advantage plans offer drug coverage, with 89% of plans that do offer that drug coverage. Now, here are some numbers on enrollment penetration. Medicare Advantage penetration is the percentage of Medicare-eligible beneficiaries enrolled in a Medicare Advantage plan in a given area.

Roughly 50% of Medicare-eligible people are now enrolled in a Medicare Advantage plan, but this does vary greatly in different regions of the country. The rural areas average about 41% penetration, while urban areas average 48%. The Midwest and the West have the highest percentage of rural counties in the United States.

Medicare Advantage penetration rates vary significantly across the country, with 0% penetration in some counties in Alaska and all the way up to 85% penetration in parts of Minnesota. 

Cameron: Yeah, so all of that is to say that the number of plans available to you and how likely you are to enroll in a Medicare Advantage plan can be impacted based on where you actually live.

And we'll just continue this by going through more Medicare Advantage statistics and information about how geography can influence these factors. So next, we'll talk about monthly premiums with Medicare Advantage plans. In 2023, 66% of Medicare Advantage plans have a 0 monthly premium, and that is up from 59% of plans in 2022.

And 99% of beneficiaries have access to a Medicare Advantage plan with 0 per month premiums, with those in Alaska being the only exception. Nationwide, Medicare Advantage premiums are $2.50 per month lower in urban versus rural areas, which just continues that trend where urban environments tend to have higher and more amounts of Medicare Advantage opportunities.

Next, we'll talk about the HMO versus PPO element regarding Medicare Advantage plans. HMOs are health maintenance organizations. They tend to be more restrictive and don't let you go out of network in most cases outside of an emergency. Whereas PPOs are preferred provider organizations and do have some more out-of-network coverage.

So with that being said, HMOs make up a majority of Medicare Advantage enrollment in urban areas at 41%. In comparison, PPOs make up a majority of enrollment in rural areas at 56%, which is a huge difference. Overall, approximately 59% of urban Medicare Advantage beneficiaries are in plans with out-of-network opportunities, compared to 78% of rural Medicare Advantage beneficiaries.

And this makes sense because if you're in a rural environment, you may want to have more flexibility because there may not be as many providers in your area, or there may not be as many plan options or healthcare options, so you want to have that out of network flexibility. However, overall, PPO enrollment percentages are growing faster than HMO plans when looking at nationwide trends and data.

Now, lastly, we'll talk about the differences in extra benefits. In 2023, 99% of enrollees have access to at least one Medicare Advantage plan, offering extra benefits not covered by original Medicare. Those in urban areas are more likely to have access to non-emergency medical transport, abbreviated as NEMT, with their Medicare Advantage plans.

Again, talking about extra benefits, generally, the extra benefits provided by Medicare Advantage plans, they're fairly similar when comparing the urban versus rural divide, although those in urban areas have a higher percentage of enrollees, with the highest level of extra benefits available. This means that in urban areas, you may see more people have access to quote-unquote, richer extra benefits with their Medicare Advantage plans.

So we'll round this out and just talk about what you should know about Medicare Advantage based on geography. 

Joanne: Yeah, there are a few things you want to always consider and remember. So you want to adjust your expectations based on where you live. That sounds a little bit obvious, but you want to understand that the availability of plan numbers and premiums can vary, and know that in rural areas, you may be more inclined to consider plans with out-of-network coverage due to generally more limited network access.

So you also want to keep in mind that your level of extra benefits is going to vary drastically based on where you live, so don't get caught up with the benefits you see advertised online or on TV. Suppose you're listening to this podcast in rural Idaho, for example. In that case, the chances are that your Medicare Advantage plan options are drastically different than if you're listening from South Beach, Miami.

According to Milliman Report, the biggest hurdles that play into the urban versus rural Medicare Advantage divide may be due to the more significant revenue for plans in the urban areas, as well as the network adequacy standards. They do state that Medicare Advantage plans entering a new market must make sure that 90% of plan enrollees in a county have access to providers and facilities providing certain services.

And this must be available to them based on certain distance guidelines, meaning how far they are from the services. This may be harder to achieve in very rural areas. 

Cameron: And lastly, what you should know with Medicare Advantage plans is you should just work with a broker that can offer the unique local options of plans in your area.

For example, in Michigan, the most popular plans by enrollment numbers tend to not be the large companies that many people are familiar with. Like United Healthcare, Aetna, or Humana's of the world, but instead, they are local carriers that some brokers aren't aware of or don't work with.

This applies to many parts of the country. So, it's important to find out if there are unique plans in your area and make sure you are working with somebody that can offer those specific options. So now we are going to shift entirely from Medicare Advantage plans and talk about Medicare supplements, which are also called Medigap plans.

Overall, Medigap plans are offered by private insurance companies like we talked about, but they are regulated by individual states and their state's Department of Insurance. Therefore, it is no surprise that Medigap coverage choices will likely vary from one state to the next. So one way that these do vary are by Medigap Premium Ratings.

We talked about this in other episodes more specifically. In our episode about how Medigap Premiums increase, there are three Medigap Premium Rating Classes. These are Community Rated, Issue Age Rated, and Attained Age Rated. Just know that your ability to find plans with these different rating classes will be highly dependent on the state that you live in.

So we went through all of these states, and we found that attained age-rated plans are most common in 36 states. Community-rated plans are only most available in 9 states. And issue age rated is the most common plan type in only five states in the country. So a lot of people get fixated on one rating system or the other, but it's important to understand what is available in your state before doing so.

We will link in the show notes to a map that shows the different states and what their most common rating system is for a Medigap plan. And then next, plan standardization can vary from one state to the next. You will often hear that Medigap plans are standardized from plan letters A through N. Joanne just mentioned that at the beginning of this episode.

You can even find the chart in the Medicare You book that says just that. However, this does not apply to plans in every single state. There are three states are Massachusetts, Minnesota, and Wisconsin, that have plans standardized by different methods than simply the plan letters. For example, Massachusetts has three standardized plans, which are the Core Plan, Supplement 1 Plan, and Supplement 1A Plan.

So the whole point there is if you're in one of those states, don't get too fixated on plan letters when that likely does not apply to you. And now we'll have Joanne talk about more geographic differences. 

Joanne: Now we move into the Medigap premiums. Medigap plans may be standardized by the plan letters in most states, but it doesn't mean that the premiums are standardized.

Plan letters are going to have different premiums, for example, a plan G versus a plan N. But also, the same plan letters can have wildly different premiums from one state to the next. So I'm going to give you a little list and examples of using roughly the cheapest premiums for a turning 65 male, non-tobacco user in a few cities, so you can get an idea of what we're talking about here.

In Portland, Oregon, this turning 65-year-old male non-tobacco smoker would pay roughly 150 a month for a Plan G. If he lived in Cleveland, Ohio, it would be 130 a month. If he lives in Omaha, Nebraska, it's 110 a month. But if he lives in Boise, Idaho, it's 170 a month. So you can see there's a wide swing based on your zip code and your state.

Cameron: Keep in mind that those are average numbers, too. It can be higher or lower in each of those places, but it gives you a good idea that each state, and even different zip codes within the state, will have different Medigap premiums. 

Joanne (2): Right. Then there are eligibility rules.

Medigap plans have eligibility rules that can differ across states, and here are some, but not all, some of examples for you. Um, open enrollment tobacco usage. So although insurance companies can't charge you a higher premium based on your health during the Medigap open enrollment, they can still take tobacco usage into account in some states.

About half of the 50 states allow Medigap companies to charge more for tobacco usage even though they are Medigap open enrollment period, which we do talk about in our other episodes about Medigap. So please understand what the open enrollment rule is. Guarantee issue. There are specific scenarios that may give you guaranteed issued rights for Medigap plans, but these can also vary.

For example, only in about 10 States, they will give you guarantee issue rights if you lose Medicaid. Underwriting differences among states. We often say that changing a Medigap plan in the future requires you to go through medical questions and health underwriting to see if you can qualify to make a change based on your health.

However, like everything else, this is not true in all states. As of recording this episode in 2023, there are at least 13 states that have unique Medigap underwriting rules that can help the enrollees. It allows them to change plans with no health questions being asked in various circumstances. And we're going to link to more detail in the show notes about those states. Now, plan availability. There are seven companies that offer Plan G for a 65-year-old female in Albany, New York. There are 45 companies that offer a Plan G for a person, a female, in Lansing, Michigan. There are 36 in Denver, Colorado, and 43 in Phoenix, Arizona. So you could see not every state is consistent in the number of plans that are being offered.

Cameron: Exactly. Yep. Just like Medicare Advantage, where you live is going to have a big impact on your Medigap options. And although we covered many of the geographic differences with Medigap plans, there are still more details that we couldn't even fit into just this episode, and we'll spare you the details and we won't go over it today.

But again, what you should know is to work with a broker that is familiar with Medigap plans in your state. They don't necessarily have to live in your state, but they should have experience doing business there and know some of the intricacies of the Medigap rules, especially if you're in a place like Wisconsin or Minnesota with uniquely standardized plans or states with unique underwriting rules like Joanne just mentioned.

We typically recommend trying to understand and ask about your state's unique Medigap landscape before focusing too much on any one of the details. For example, don't go down the rabbit hole of trying to learn about issue age, attained age, community-rated, and then only to realize that your state only allows for one type of plan rating.

Also, make sure you know the specific premiums for your plans in the state that you live in, and don't just listen to other people's opinions unless they are referring to exactly the coverage where you live. And now, we'll round things out by talking about everyone's favorite topic, which is Part D, which is prescription drug coverage.

We'll talk plan availability with Part D. Just like Medicare Advantage plans, not all states have the same number of plan offerings. According to Kaiser Family Foundation, the number of Part D plans available in 2023, ranges from a low of 19 plans in New York up to 28 plans in Arizona. Overall, Part D plans vary from state to state instead of being as specific as by county or by zip code.

Plan premiums also vary, of course. Just like with plan availability, the Part D plan premiums will vary from one state to another. This is even true of identical plans provided by the same company. For example, a Part D plan offered by one insurance company with the same name, so same company, same name, has a monthly premium that fluctuates from about 41 per month in one state all the way up to 108 per month in another state.

And that was using numbers we looked at, Part D plans currently available in 2023 for that example. Now, of course, plan coverage can also vary by one state to the next. Part D plans from the same company, again, the same name, might have different out-of-pocket costs just like deductibles, co-pays, and co-insurance from one state to the next.

The same plan we just mentioned with the different premium, it also has different Tier 3 medication co-pays based on where you live. This can be as low as 20 in some states, all the way up to 47 in another. And lastly, Part D plans can vary based on your actual assistance levels for Part D. So, this is actual financial assistance options.

The first one is LIS, Low Income Subsidy, which is also known as Extra Help. Qualifications for this plan, it can depend on your income and asset limits. And the key here to know is that based on where you live, these income and asset limits can be slightly different. For example, in Alaska and Hawaii, you may be able to qualify for this program with slightly higher income than in other states.

Also, there are called benchmark plans available if you are eligible for these benefits. These are plans that can be as low as 0 per month for you, the beneficiary if you qualify for extra help. The number of these plans can go all the way down to three available in your region, all the way up to eight.

And then last but not least, there are state pharmaceutical assistance programs, which are shortened to SPAPs. And just like the name implies, these are going to vary from one state to the next. These can help people pay for prescriptions, and of course, not all states provide these. But according to Medicare Right Center, there are roughly 16 states providing some type of SPAP for beneficiaries that we will, of course, link to in the show notes.

So Joanne can round this out by talking about what you should know about Part D differences based on 

Joanne: where you live. So just like with the other Medicare coverage options that we've talked about, when it comes to Part D coverage, you understand that the costs and the coverage can and likely will vary based on the state you live in.

But don't stress about the planned costs that you hear about on social media or that you see advertised. Instead, make sure that you're considering the specific plans that are available where you live. Try and tune out that noise. Of course, again, a broker is a great resource to help compare your Part D costs in your area.

But, you can also easily do this on your own using the Medicare. gov Plan Finder. And this is going to show you the premiums, the coverages for all of the Part D plans that are available exactly where you live. You can also check out our free online course at gmedcourse, g m e d course. com, where we actually have a module that shows you exactly how you can do this analysis by yourself.

In addition, we have a really good YouTube video that walks through a Part D analysis, and it's really not that hard to do. Also, always remember that if you move to a new state, you will also very likely need to change to a new Part D plan that is available in your new state in the new zip code, so be prepared for that as it applies 

Cameron: to you.

When it comes to understanding your Medicare coverage options, it is vital to remember that where you live can greatly impact the plan and coverage options you have available to you. Don't get caught up in general Medicare advertisements that promote coverage options you don't actually have available to you.

Instead, consult with an independent broker familiar with where you actually live and compare options that you actually have available to you. As always, please leave us a review on your podcast app and subscribe so you can listen to future episodes. You can also find more Medicare content from us by going to YouTube and searching GRDN Medicare.

You can also do the same on TikTok. If you have any feedback or questions, you can send us an email to info at G medicare team. com. Thank you and have a great day.