February 22

12:30 AM I could never understand until today how Medicare Advantage plans work.

For people with Medicare, the cheapest type of insurance seniors can have in the US through a life long mandatory contribution (until retirement) on their payroll, there is no coverage for medications prescriptions unless they enroll separately into what they call Medicare pard D and pay more and generally doctors run away from people with Medicare because they slash their bills more than a half, sometimes to next to nothing.

3% of gross salary is not much, some would say.

There are countries in the world where people pay more for mandatory state insurance (in the UK is called National Health System or NHS) but over there the privately insured are a minority and also health care cost less.

Healthcare for retired seniors in UK is free with NHS and for a supplemental private insurance the cost is around 150 pounds a month (about 200 dollars). Similar situations in other advanced countries like France and Germany etc. with universal health care.

And here come the MIB for profit Medicare Advantage plans, a "middleman" between the insured and Medicare. With those, you don't have to pay extra to enroll in part D (prescriptions), though there's a monthly penalty of maybe up to 100 dollars if you did not enroll into it (directly or through advantage plans) right when you got Medicare, per reason you deteriorated your health by not having it.

One of the Medicare Advantage plans is Humana, and they even used to give you back a monthly allowance on a card that kinda matched that penalty and everyone was happy.

However this year Humana cut that one while increasing all copays. At Humana, maximum allowable for insulin by example is 35 dollars a month which sometimes is enough and sometimes not though they pay without blinking for much more expensive medications like pioglitazone. 

BTW many people like me in the past think insulin is very expensive and delay using it which is devastating for your health. 5 pens of Lantus with 300 units each (i use up to 40 units a day) which in combination with other meds lower my BG to about 200, cost about 250 dollars.

Today i figured the mystery. The cost for prescriptions in Medicare Advantage plans is covered by huge government subsidies paid to them Medicare Advantage plans like Humana. Question. Why don't they pay those subsidies directly to Medicare so people could have prescriptions without the "middleman"?

And here's the answer. Social Security, Medicare and Medicaid (states run health program for those with low income) account for about 3 trillion of the total 7 trillion in 2025 US spending budget. Medicare alone accounts for 842 billions. If we divide it by 59 million number of retirees and 12 months we get...

To that we should add the premiums (185 + whatever, part D). Average cost for a private insurance in the US is...

Some states have on top of that health programs covered by their own budget.