By Caroline Humer via Reuters.com

The U.S. government on Thursday proposed an increase of 1.84 percent on average in its 2019 payments to the health insurers that manage Medicare Advantage insurance plans for more than 20 million elderly or disabled people.

The proposed rate, which affects how much insurers charge for monthly healthcare premiums, plan benefits and ultimately, how much they profit, was near analyst expectations, and insurer shares were largely unchanged in after-hours trading.

UnitedHealth Group Inc, Humana Inc, Aetna Inc and WellCare Health Plans Inc are the largest sellers of Medicare Advantage health insurance. Under the program, they are paid a set rate by the government to cover member healthcare costs.

The 2019 payment proposal also expands the benefits that insurers can offer in the plans to include items like wheelchair ramps and devices to diminish the impact of health conditions, a positive for insurers competing with traditional Medicare for members.

Kim Monk, managing director of company and investing research group Capital Alpha Partners, said she had expected an increase of 1 percent to 2 percent on average. Payments rates will vary based on geography and on factors like the health of members and the quality ratings of the insurer.

January enrollment data showed that Medicare Advantage 2018 enrollment was 20.9 million and had grown to account for 35 percent of overall Medicare enrollment, BMO Capital Markets analyst Matt Borsch said in a recent research note.

Medicare Advantage competes with the traditional Medicare fee-for-service program. Both have grown as the so-called “Baby Boomer” generation ages into Medicare and together cover more than 55 million people.

Insurers have bet on future growth of Medicare Advantage as the Trump Administration turns to private insurers to control healthcare costs.

The Centers for Medicare and Medicaid Services, a division of the U.S. Department of Health and Human Resources, releases the proposed rate early each year and then opens a public comment period. The final rate released in April could be higher or lower than the proposed one.

In December, CMS provided a forecast for medical services cost growth of more than 4 percent, one of the key components of the total payment rate, which also includes other factors. For instance, the law requires the government to pay similar amounts in the Medicare Advantage plans and the fee-for-service Medicare program, which typically results in a payment cut to insurers.

Center for Medicare Advocacy – Matt Shepard: 860-456-7790, shepard@MedicareAdvocacy.org
Medicare Rights Center – Deane Beebe: 212-204-6248, dbeebe@medicarerights.org

Statement from
The Center for Medicare Advocacy and The Medicare Rights Center

— People with Medicare Largely Forgotten in Spending Bill Debate —

Washington, DC – We are relieved that Congress has reached an agreement to fund the federal government through February 8, as any lapse in federal funding can have serious consequences for people with Medicare and their families. We are also relieved that as part of this deal, Congress reauthorized the Children’s Health Insurance Program (CHIP), which provides affordable health coverage for over 9 million children in working families — many of which include people with Medicare.

However, we are concerned that key, bipartisan health policies were not addressed in this legislation. As Congress seeks to resolve outstanding spending and policy debates in the coming weeks, we urge lawmakers not to forget older adults and people with disabilities by overlooking the need to fund and extend these initiatives. The health and financial well-being of people with Medicare is at stake.

Without delay, we urge Congress to fully repeal the harmful Medicare therapy caps. These arbitrary caps create a barrier to accessing necessary therapy services, particularly for individuals with long-term, chronic conditions. The absence of such therapy can lead to avoidable health declines and permanent deterioration. To prevent these outcomes, the cap should be repealed or, at the very least, the process that has allowed individuals to seek an exception to the cap must be reinstated. A permanent fix is urgent to ensure that care is delivered to vulnerable patients, protects beneficiaries from high out-of-pocket costs, and safeguards the long-term viability of the Medicare program.

We also urge Congress to extend funding for community-based organizations to provide outreach and enrollment to low-income Medicare beneficiaries. Previous allocations for these critical activities have led to important, proven results, such as helping 2.5 million beneficiaries in need pay out-of-pocket health care costs they could not otherwise afford. Half of all people with Medicare—nearly 29 million older adults and people with disabilities—live on annual incomes of $26,200 or less, and one quarter live on $15,250 or less. Most people with Medicare simply cannot afford to pay more for health care, and without this assistance, many would be forced to go without care.

These policies have a long history of bicameral, bipartisan support and must be extended immediately. If not addressed soon, people with Medicare will face increased costs, reduced access to care, and decreased health and economic security. Congress must act now to protect and strengthen Medicare by funding and enacting permanent solutions for these vital health care extenders policies.

Regulation taking effect Feb. 5 requires reasonable effort to find trusted contact, allows brokers to stop fund disbursement

By Mark Schoeff, Jr. via investmentnews.com

A new Finra regulation designed to prevent financial exploitation of seniors will spur what could be delicate conversations between brokers and older clients.

The rule, which goes into effect on Feb. 5, requires that brokers make a reasonable effort to identify a trusted person who can be contacted if the broker is concerned that the client is suffering from diminished mental capacity or is the target of a scam.

The request for a trusted contact must be made at account openings for new clients and during account updates with existing clients.

The regulation also provides brokers with liability protection if they place a hold on disbursements from an account because they think their clients could be harmed.

If the client declines to provide a trusted contact, the broker does not have to keep pushing, according to a set of frequently asked questions posted on the website of the Financial Industry Regulatory Authority Inc.

But that initial conversation could be tricky.

“We have to be real careful with that, especially with seniors, because it’s a touchy subject,” said Amy Daniels, an Edward Jones adviser in Searcy, Ark. “It’s a simple question: Who do they trust? It may be the first time a financial adviser has asked that question.”

Ms. Daniels has been gathering trusted contact information for two years. She’s found that the discussion of what to do if the client declines is a gateway to a family conversation.

“That’s when I really get into the what ifs, in the family meeting,” she said.

RBC Wealth Management brokers also have been obtaining trusted contacts for a number of years. Angie O’Leary, RBC head of wealth planning, recommends that discussion be placed in a larger context.

Conduct “a wealth planning conversation with the client rather than just focusing on the regulatory requirement,” Ms. O’Leary said. “Then they’re having a richer conversation.”

Wells Fargo Advisors has had a program in place since 2014 to protect older clients. The trusted contacts are a key part of the system, according to Ron Long, the firm’s director of regulatory affairs and elder client initiatives.

“We use the trusted contact information as part of the escalation process to protect the client,” Mr. Long said. “In the majority of cases, the trusted contact gets involved and helps resolve the situation. We are well above 50% where a trusted contact or a client or a combination of both are appreciative that we decided to step in.”

The Finra rule gives brokers a safe harbor if they stop disbursements from a client’s account. They can place an initial hold for 15 days and then extend it for another 10 days.

The Finra rule does not require that brokers report suspected elder abuse to regulators or other government agencies, but Joseph R.V. Romano, president of Romano Wealth Management in Evanston, Ill., said that’s what they should do anyway during a disbursement hold.

“The 15 days is giving you the opportunity to escalate this to the proper authorities, like the Adult Protective Services in your state,” said Mr. Romano, a member of the Finra board.

Mr. Romano, who has participated in industry conferences on senior exploitation, spoke about the Finra rule from his perspective as a firm owner, not on behalf of Finra or the board.

APS can investigate the suspected abuse.

“You’re escalating this to an agency that is prepared to make that evaluation,” Mr. Romano said.

At larger firms, such as Edward Jones and Wells Fargo Advisors, escalation means getting compliance or field office supervisors involved in the decision on whether to hold a disbursement.

As the Finra rule is going into effect, several states have implemented or are considering a model elder-abuse rule drafted by the North American Securities Administrators Association. The NASAA regulation is similar to Finra’s but requires that financial advisers report suspected abuse to authorities.

Mr. Long doesn’t foresee conflicts between the rules.

“I think brokers can follow the Finra model and enhance it with whatever state rule may exist,” he said.

The bigger challenge for brokers may be dealing with older clients who resent the idea that they have to prepare for the stage in life where they begin to decline.

Brokers’ “interest in doing the right thing for their client and protecting their client will outweigh the concern about the client pushing back,” Mr. Romano said.

By Jenn Christensen via cnn.com

Thomas Burke Jr., a Marine who returned from tours in Afghanistan and Iraq to attend Yale Divinity School, has also done three tours in the Veterans Health Administration for mental health care and says he’s experienced mixed results.

Burke, 28, served in the infantry. He said his first counselor, in 2011, didn’t have much experience with combat veterans and wasn’t much help. In 2012, he clicked with his second counselor, who “really cared and took time to get to know me and gave me enough of a baseline to productively go through my academics.”

Before becoming a minister and providing mental care of his own, he tried to get back into counseling. But it was a “very negative experience,” he said.

“I went in, being vulnerable and laying out my problems, and they were dismissive and condescended to me and treated me like I am some victim and were not getting to the bottom of the problem and essentially said ‘thanks for telling us,’ ” Burke said. “Imagine what damage that can do to veterans who seek help.

“It’s hard for me to badmouth the VA, because there are a lot of good people there who are trying to help and do care about vets, but a lot of people I talk with do badmouth them,” Burke said.

Many Americans who served in the Iraq and Afghanistan wars need mental health care, but they aren’t always getting enough from the Department of Veterans Affairs’ Veterans Health Administration, according to the results of a congressionally mandated investigation released Wednesday.

About 4 million people have served in Iraq and Afghanistan, the longest sustained US military operations in history. A disproportionate number have come back with mental health challenges like anxiety, depression and post-traumatic stress disorder, research shows. The number of suicides for veterans of these wars has reached a record. The VA has not always been able to handle this crushing need for services.

But when veterans get mental health care from the VA, it is of “comparable or superior quality” to the kinds of care available elsewhere.

According to the new study, nearly half of American veterans who need mental health care don’t get it. Also, more than half of those who would benefit from care don’t know they need it, the research by the National Academies of Sciences, Engineering, and Medicine found.

The majority of those who could use these services don’t know whether they are eligible, don’t know how to get the services and don’t even know that the VA provides mental health care, according to the report.

That’s “one of the things the report pointed out that I found the most distressing,” said Louis Celli, national director of the American Legion’s veterans affairs and rehabilitation division, which was not involved in the new report.

Celli said the VA does a “herculean job through social media campaigns and outreach with their partners” to let veterans know about the care it provides. “It’s hard to imagine more you could do, short of knocking on everyone’s door,” but he believes the lack of care is a “failure on the community’s part.”

One workaround that the American Legion has found successful is enlisting veterans’ families to help them get the care they need.

That’s what helped Seth Robbins. An Army veteran who was stationed predominantly in Korea, the 40-year-old has gotten his health care through the VA for more than a decade, but he sought help for anxiety only after his wife gave him an ultimatum.

“As soldiers, sailors, Marines and airmen, we are taught to ‘suck it up and drive on.’ We heard that on a regular basis, and it gets into your head,” Robbins said.

He also hesitated to seek treatment because he had concerns that were shared by veterans in the report.

For instance, Robbins worried that his rifles would be taken away if he talked about his anxiety. “There’s also the stigma or the feeling that something is broken and I’m not the normal one or that they’ll lock you up,” he said. “But I’ve got a job and a family to support and a house.” The VA has helped him “get to a place where I can manage.”

Veterans also find the VA’s appointment system “burdensome” and “unsatisfying,” the report said. Robbins agrees and says he’s lucky his father, a Vietnam veteran, showed him how to navigate the system.

He also feels lucky to have a federal job that gives him the freedom to go to appointments that can take hours out of his day. Other veterans said transportation challenges and the distance to the VA from their homes can be a huge obstacle to getting care, according to the report.

For veterans like Robbins who succeed in getting treatment, the report found that they encounter “tremendous mental health care expertise” and that the system can deliver care in a “truly integrated and strategic manner.” But the report added that chronic staffing challenges and confusing procedures and policies continue to be a challenge.

The American Legion’s Celli said that along with the new report, he thinks it’s important to note that the system has improved amid the extra scrutiny of the agency over the past several years. Robbins, for one, has noticed a change in 15 years — a “vast improvement.”

Celli said that he knows the system isn’t perfect but that the American Legion will continue to fight to improve it.

“We are not VA cheerleaders, but we do work with them every day to make sure they do rise to the occasion and take care of veterans,” he said. “We’ve seen the progress, and we hope more veterans will seek out this care.”

Find out if, and why you may be paying more.

By Rachel L. Sheedy, Editor
From Kiplinger’s Retirement Report, January 2018

The maze of government rules can create unexpected outcomes. And that’s certainly the case for 2018 Medicare premiums. While the standard Part B premium remains $134 a month, many beneficiaries will pay more for Part B. The culprit in this counterintuitive result? The hold-harmless provision.

Last year, this provision had a positive effect for most beneficiaries. For those whose Medicare premiums are automatically deducted from Social Security, the rule prevents premiums from rising more than the amount added to benefits by the annual cost-of-living adjustment.

In years when there is no Social Security COLA or a minimal COLA, such as 2017’s 0.3%, Medicare premiums are reined in. Although the standard Part B premium for 2017 was $134 a month, the tiny COLA meant many people continued paying about $109 a month.

But inflation heated up slightly in the past year, resulting in a 2% COLA for 2018. That may still not seem like much, but for about 42% of beneficiaries it’s enough to allow cover for Medicare premiums to rise to $134. One Retirement Report reader in this boat says he was disheartened to see the significant jump in his monthly Part B premium for 2018.

Hold-harmless is still kicking in for about 28% of beneficiaries in 2018. For those with lower Social Security benefit amounts, the 2% COLA isn’t enough to let their Part B premiums rise all the way to $134. They’ll pay less than the standard amount.

Groups that aren’t held harmless, such as those who don’t deduct their Medicare premiums from their Social Security benefits or new Medicare enrollees, will pay the standard $134 a month.
Some High Incomers Face Surcharge Spike

There’s one other group not protected by the hold-harmless rule: high incomers. And they will pay premiums significantly higher than the standard amount, up to about $429—and that’s just for Part B. High incomers also face a surcharge as high as about $75 a month on Part D premiums. The surcharges for Parts B and D begin to kick in when adjusted gross income plus tax-exempt interest is more than $85,000 if single or $170,000 for married couples filing jointly.

While the premium surcharge amounts for Part B remain the same for 2018 (and are slightly lower for Part D), the income thresholds in the three highest tiers drop—subjecting some high incomers to higher costs. In 2017, for example, an individual with $140,000 of modified adjusted gross income would have been in the second tier, which ranged from $107,001 to $160,000, and charged about $268 a month. But in 2018 that individual moves to the third tier, which ranges from $133,501 to $160,000, and will pay about $348 a month—a spike of about 30% due solely to the shifting income thresholds. See the box for 2018 details.

If you’re threatened by an income-related surcharge, check to see if you qualify for relief. The government determines who owes surcharges by looking at tax returns from two years ago. So 2018 surcharges are based on income reported on 2016 returns.

If your income has dropped as a result of a qualifying life-changing event, such as death of a spouse, divorce or retirement, you can ask for relief, and the government will use your income from a more recent tax year to determine if you have to pay the surcharge. File Form SSA-44 with the Social Security Administration to request relief and provide documentation of the qualifying event. Learn more at socialsecurity.gov.

But note: A spike in income, such as from the sale of a house, is not considered a life-changing event. If your income spiked in one year but fell the next, you’ll pay the surcharge until the lower year’s tax return is used to determine your premiums.