The $74,973 Question: Are Medicare Beneficiaries Informed Users of Private Medical Care Contracts?

ABSTRACT

Health-care providers are allowed to opt-out of Medicare, privately contract with beneficiaries, and require that beneficiaries pay the full cost of services. Responses from a nationally representative sample of Medicare beneficiaries reveal that they lack the knowledge necessary to make informed decisions regarding such contracts. For example, only 4.6% of participants knew the correct answer to a real-life $74,973 question, leaving a full 95.4% vulnerable to paying a large bill, even a $74,973 bill, they should not pay. In addition to advocating that Medicare effectively monitor private medical care contracts, social workers should educate beneficiaries and/or their caregivers on the implications of entering into such contracts or refer them to their State Health Insurance Assistance Program or Senior Medicare Patrol program for expert guidance.

KEYWORDS:

• Medicare
• beneficiary knowledge
• opt-out
• balance billing