Local Insurer Develops Medicare Product
With the baby boom generation moving deeper into eligibility for federal Medicare health coverage, local health officials are preparing to address the growing market with a service of their own.
FirstCarolinaCare Insurance Co. has developed a Medicare Advantage product that gives Medicare-eligible residents of Moore County a local option for benefits.
The annual enrollment period for FirstMedicare Direct begins Oct. 15 and ends Dec. 7.
"We have a zero premium product and a $49.90 per month product," said Ken Lewis, CEO of FirstCarolinaCare. "They're both good products. We believe they will compete very favorably in our market."
FirstCarolinaCare, a subsidiary of First Health of the Carolinas, plans to market First Medicare Direct in Moore, Montgomery, Scotland, Richmond, Hoke and Lee counties. It will begin conducting information seminars in each county on Oct. 10.
"We will also use newspaper ads and direct mail to get the word out," Lewis said.
FirstCarolinaCare received approval on Sept. 14 from the Center for Medicare and Medicaid Services to offer its own Medicare Advantage product.
"This is a highly regulated process," Lewis said.
David J. Kilarski, CEO of FirstHealth, said developing a Medicare Advantage product has been in the works for about 18 months.
"It was not an easy decision because it does carry a little financial risk for us," Kilarski said. "We need to sell enough of the product and demonstrate some cost savings in the system overall."
A recent survey shows that about 20 percent of hospital networks now market an insurance product, and another 20 percent are exploring insurance options.
"We bounced it back and forth. The question was timing," Lewis said. "We believe we can do it now in the right way with the right value. We've always focused on the value tool. It's all about doing the right things in our community.
"I think we still have challenges, but they're not just here, they're across the country."
As the U.S. health care system continues to transition from fee-for-service care to global and bundled payments, the financial risk associated with patient care is shifting from insurers to providers.
"Our industry is changing, and we're looking toward more value-based programs and benefits," Lewis said. "We're also looking to improve preventive care, our efficiencies and the wellness of our community."
The timing is important because the baby boom generation has already begun to reach retirement age, and demographic trends show that the number of people turning 65 years old is expected to jump about 50 percent between 2010 and 2020 to more than 3.9 million.
Kilarski said the goal is to "bend the cost curve down."
"If we can manage the patient's care correctly, can we avoid an expensive hospitalization or emergency room visit?" he said. "We think we can. We want people to stay well."
FirstMedicare Direct offers more benefits than original Medicare and includes Plan D prescription coverage, thereby eliminating the need to have another plan to cover prescriptions.
"It's somewhat simpler because it's essentially three products in one," Lewis said.
Nationwide, about 25 percent of those eligible for Medicare have enrolled in a Medicare Advantage program in the past decade. Lewis said the number is about 9 percent in Moore County and about 3 percent in the other five counties.
"It's a trend," he said. "If we're successful, then we will improve our mission to care for people."
Contact Ted Natt at (910) 693-2474 or email@example.com.
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