Insurance agents have sold fraudulent Medicare plans to an estimated 1,000 Mississippians over the past year, forcing them to spend months untangling the mess to regain coverage under a traditional Medicare program.
State and federal government officials are doing little to stop the unauthorized switches as the problem persists.
For $250 to $500 per person, agents are switching Mississippians 65 and older to Medicare Advantage plans, changing the available doctors, prescriptions and payments.
“They just don’t have a bit of shame,” said Pearl resident Danny Waggoner, whose mother was switched twice from her preferred Medicare plan. “They’re just vultures.”
Last week, a U.S. Senate committee held a hearing on the issue with Medicare officials promising a closer watch in the future.
In Mississippi, an understaffed Insurance Department pulled the license of one Memphis agent.
Many do not learn of a change in plans until they visit a pharmacist or doctor.
Waggoner’s 79-year-old mother learned she was knocked off her Medicare plan after visiting a local pharmacy. She could not buy the prescription ordered.
The ordeal traumatized Waggoner’s mother, who did not want her name used.
“She’s scared that somebody’s going to shoot her in the back” because he’s discussing her case, he said. “She’s scared somebody’s going to come to our house.”
Waggoner said his mother never gave anyone her private information or spoke with an agent about changing plans. He assumes someone bought her personal profile and forged her name on documents.
Waggoner worked through the state departments of Human Services and Insurance to get her reinstated.
“The senior citizens out here, they’re just at the mercy of the Lord,” said Waggoner, former Pearl fire chief.
Many recipients receive coverage for hospital visits through Medicare Part A and doctor visits through Medicare Part B.
A third plan, Medicare Advantage, or Medicare Part C, offers coverage for hospital and doctor care, but access can be limited. The plan operates similar to health maintenance organizations.
Individuals who sell Medicare Advantage plans must follow strict rules. Salespeople are required to make appointments to discuss plans and cannot make “cold calls.”
Willie Varnado Jr., who sells Medicare Advantage policies in Rankin County, said he buys a list of interested customers and appointments from a broker. He also takes referrals.
He only has difficulty selling the plans after news reports of fraud cases.
“There are so many salesmen out here who are really trying to help people,” Varnado said.
He says Medicare Advantage plans can be a better option for some and pay for eyeglasses and hearing aids – items traditional Medicare does not cover.
“The salesman has to do some extra work if he’s going to do it properly,” Varnado said.
One insurer of Medicare Advantage, WellCare Health Plans, is taking steps to ensure new customers actually want its product.
Rather than call new customers after their enrollment, the company calls prior to their acceptance into the plan, he said. This will allow a WellCare worker to see if the customer understands the switch.
The company has ended contracts with 16 of its 8,000 independent agents for improper sales practices, said spokesman John Aberg. The insurer contracts with a marketing organizations, which hires the agents. Agents are trained and go through criminal background checks.
In Mississippi, fraud began in the northeast counties a year ago. Reports have spread across the state, as well as the nation, since.
Members of Mississippi’s congressional delegation handled countless calls trying to return residents to their original plan.
“We have been successful in getting these folks reinstated on Medicare, but the process takes time,” said Kyle Steward, spokesman for 1st District Rep. Roger Wicker.
There is “bipartisan interest” in the issue, and Wicker, a Republican, has talked with Medicare officials, Steward said.
“Whether it is a case of salespeople not knowing the product or whether they are intentionally misrepresenting, senior citizens are being disadvantaged,” he said.
Last week, a Senate Select Committee on Aging heard testimony from Medicare officials, insurers and state insurance commissioners on the problem.
Medicare officials testified they stepped up oversight and will require Medicare Advantage plans to call customers before they are switched, Steward said.
They also promised civil penalties and termination of contracts if abuses are found. The agency will require “specific and unambiguous language” in the plans’ marketing material in the future, Steward said.
A spokesman for U.S. Sen. Trent Lott urged Mississippians to stay on traditional Medicare plans.
“It’s hard to say how many calls we’ve got,” said Lott’s spokesman, Lee Youngblood. “But it’s been a bunch.”
Information from: The Clarion-Ledger,
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