SEBC subcommittee continues to dissect Medicare plans

The SEBC subcommittee continued Monday to dive into the minutiae of Medicare plans for state retirees.

The subcommittee gave a lot of time to the costs to the average retiree for the state’s special group health insurance plan Medicfill versus Medigap K, G and N supplement plans and two Medicare Advantage plus prescription drug plans.

They focused on costs for retirees who pay less for a plan in both out-of-pocket and premium costs as well as people who pay more in both areas.

The state’s traditional Medicfill program, which is the most generous of Medicare plans offered in Delaware, is among the plans that cost the least for retirees because the state pays for a range of costs.

For the 10th percentile of retirees, or people who pay less than 90% of retirees, the total costs for the GHIP Medicfill plan is between $198 and $474, while the most for a Medigap supplement is $2,093, and Medicare Advantage is $202.

For the 90th percentile of retirees, or people who pay less than 10% of retirees, the total costs for the GHIP Medicfill plan is between $521 and $797, while the most for a Medigap supplement is $6,231, and Medicare Advantage is $7,942.

The difference in costs is due to people choosing different supplement and prescription plans,  with some plans being more expensive than others.

While premiums and the cost of medication continue to rise for retirees, prescription drug out-of-pocket maximums will be capped at $2,000 starting in 2025. This is because the federal Inflation Reduction Act, signed in August 2022, capped the maximum cost for prescriptions under Medicare Part D. 

The subcommittee, created this year by the General Assembly, is exploring alternatives to moving state retirees from their generous state plan to a Medicare Advantage plan, which the state intended to do for this calendar year. 

But retirees, including the vocal Delaware RISE group sued the state to stop the move to Medicare Advantage, saying the state was violating a promise to retirees. A Delaware judge agreed and issued an injunction stopping the move.

Now the subcommittee hopes to be able to make a recommendation to the full benefits committee by May, even though creators of the committee admitted from the start that it might not be able to meet that deadline.

Lt. Gov. Bethany Hall-Long, chair of the subcommittee, said it might take the subcommittee two or three months to issue a final report and recommendations because of the density of the material. In the meantime, they may be able to get a summary out, she said.

Rep. Mike Ramone, R-Pike Creek, asked whether extra COVID-19 funding can go towards covering the Medicare liability, and Secretary of Finance Rick Geisenberger said in response that he’s almost certain that COVID-19 funding can’t be used for liabilities.

The public comment section continued to be filled with people objecting to the change.

Retirees said Medicare Advantage will cost them much more, delay care by requiring pre-authorizations for some treatments and could restrict their choice of providers, who must belong to the plan.

When the judge issued his ruling, the full state Employment Benefits Committee voted to extend the Medicfill plan for six months. The full committee is expected next month to extend the current Medicfill plan again for six months, from June through December, at a cost of $6.8 to $7.5 million a month above what the Medicare Advantage program was to cost.