Medicare Advantage - Gotcha!

When is a hospital admission not an admission? When you are not admitted. Confused? You should be.

Just because you stayed in the hospital 24 hours does not necessarily equal being admitted to a hospital and the difference in what YOU pay can be frightening.

Ralph went to Northwest Hospital to have stents placed in his coronary arteries.

He spent 24 hours in the hospital, he was in a hospital bed, but he was not admitted.

His bill for the 24 hour stay?

$124,241.67.

The good news for Ralph, who is 86 years old, is that his Medicare Advantage plan had to pay only $14,093.04 of the $126,241.67 hospital bill. This is because Medicare sets the price for each service, and $14,093.04 was the total of approved charges for services associated with Ralph’s 24-hour hospital stay – or rather, his observation stay.

The $126,241 bill is a made up number – unless you don’t have insurance.

Sounds like a good reason to buy insurance.

But wait, there's more.

The bad news for Ralph is that his Medicare Advantage plan requires him to pay 20% for “outpatient surgery”, so he had to pay $2,814.48.

Bummer.

That's one of the dirty little secrets you never hear about in those "information" meetings hosted by Advantage plans from carriers like Aetna, Humana, Blue Cross and others.

The low premiums, some as little as $0, come back to bite you when you least expect it.

And in Ralph's case, this was minor. Some plans can have as much as $6700 out of pocket.

Had Ralph had original Medicare and Medigap plan F his out of pocket would have been $0.

That is something to think about.