Patient Risks with Insurance Choices: Information for Social Workers

This blog post was made by Beth Witten, MSW, ACSW, LSCSW on September 3, 2020.
Patient Risks with Insurance Choices:  Information for Social Workers

Health insurance choices in the United States are very complex. I described insurance options for people with kidney failure in a recent blog entitled Insurance 101 for Dialysis Social Workers. You may want to read that before reading this.

Medicare Forms & Choices

When someone starts dialysis or has a transplant, dialysis clinics and transplant programs complete the ESRD Medical Evidence Report (CMS-2728) that tells SSA that s/he can get Medicare for ESRD. One question on the form asks, “Is the patient applying for Medicare?A person with a job-based plan that pays 1st may say “No” if s/he doesn’t know that having Medicare as a 2nd payer can save more than the Part B premium would cost.

An SSA representative who receives the CMS 2728 and does the patient interview can complete the application for ESRD Medicare (CMS 43). This SSA Medicare Secondary Payer of ESRD Benefits policy describes what SSA employees should tell ESRD patients who have job-based health plans about their options for enrolling in Medicare. If dialysis or transplant staff complete this form without telling patients the risks, patients could be harmed—and the social worker or dialysis clinic could be liable. The policy states that there is nospecial enrollment period for people with ESRD, even for those who also have Medicare due to age or disability. It advises ESRD patients with-based plans to:

  • Take Part A and B at the same time when first eligible to take them.


  • Delay enrolling in both Part A and B until the end of the Medicare secondary payer (MSP) period.

Staff need to help patients understand the risks that they may face based on the choices they make.

  1. Risks of not taking Medicare as a 2nd payer

    • Dialysis companies make much more from job-based plans than the amount Medicare allows and pays.1 That higher billed amount could mean a higher share of costs for the patient.

    • Dialysis clinics and most doctors “accept assignment.” They can balance-bill a patient who doesn’t have Medicare as a 2nd payer. They cannot balance-bill a patient who has Medicare as a 2nd payer and job-based plan that pays at least 100% of Medicare’s allowed amount.

    • Dialysis companies may discount bills if patients provide personal financial data, but other providers do not. Some patients are too private to share financial information with their dialysis clinic.

  2. Risks of taking free Medicare Part A without premium Part B:

    • A 7-month initial enrollment period for Medicare starts 3 months before the month someone can have Medicare and extends 3 months afterward. Patients can add Part B at any point during that window. Failing to take Part B during the window limits when patients can enroll in Part B to the general enrollment period from January through March yearly, with Part B starting that 7/1.

    • There is a 10% late enrollment penalty for each 12 months a patient waits to take Part B after having Part A.

    • Patients who delay enrolling in Part B must keep track of when to apply for Part B to avoid a gap in coverage. EXAMPLE: A job-based plan paid first until 3/31/2020, but the patient did not enroll in Part B in time. Now, s/he can only enroll in Part B from 1/1-3/31/2021—and coverage will not start until 7/1/2021. The job-based plan is not paying for dialysis or any outpatient care and neither is Medicare from 4/2020 through 6/2021.

    • During the gap, dialysis clinics can charge patients the higher rate it charges plans other than Medicare. Dialysis clinics may discount the bill if the patient meets its financial guidelines. Medicare regulations do not prevent a clinic from discharging those who don’t pay bills.

    • Large bills and money problems can result in medical bankruptcy and added stress.

    • Transplant patients who cannot afford healthcare or anti-rejection drugs could lose their transplanted kidneys.

  3. Possible fixes for the patient who enrolled in Part A without Part B

    • SSA Withdrawal of Application policy allows withdrawal of an application for Part A and enrollment in Part A and Part B together. Any paid Part A claims must be repaid. (SSA can tell if Part A claims were paid; the job-based plan may have paid what might have been billed to Part A.) NOTE: Patients who received SSA, SSDI or Railroad Retirement checks would have to pay back those benefits to use this policy.

    • An ESRD patient who waived Part B can enroll in Part B right away without waiting to January through March and won’t have a premium penalty when s/he turns 65 or is eligible for Medicare due to disability after receiving SSDI checks for 24 months. In fact, those paying the late enrollment penalty can ask for the premium penalty to be removed.

    • A patient may be able to ask for “equitable relief” under the SSA Evidence of Government Error or Delay policy to get Part B sooner if an SSA employee misinformed the patient, including telling the patient with a job-based plan that s/he could take Part A and enroll in Part B at the end of the MSP period under a special enrollment period.

  4. Risks of Medicare Advantage Plans2

    • MA plans tout low or no cost premiums. Healthy people may save money, but with a chronic illness like ESRD, costs may be higher than expected. In 2020, CMS allows MA plans to charge members up to $6,700 a year for in-network Part A and B services. Plans that cover out-of-network services can charge up to $10,000 for in-network and out-of-network services. Premiums and Part D drugs are not under this cap. Caps may be higher in 2021 leaving patients to pay more.

    • Medigap plans do not work with MA plans. Although Original Medicare has no cap, Medigap plans, if a patient can get one, help pay Original Medicare’s out-of-pocket costs.

    • Most MA plans pay 80% for dialysis and anti-rejection drugs. The patient then owes 20%. Dialysis clinics can bill drugs and labs separately to MA plans, so the 20% may be higher. MA plan members cannot have a Medigap plan to cover these costs, and some state programs that help pay for drugs will not help those with MA plans.

    • MA plans can limit choice of doctors and dialysis and transplant providers, and may require referrals to see specialists and prior authorization for some care.

    • MA plans can change providers—requiring plan members to change doctors, dialysis clinics and transplant programs.

    • MA plans may not cover non-emergency healthcare when traveling outside the network area, but must cover dialysis at 80% even out-of-network.

    • Patients with HMO MA plans may have to travel farther for care and may only get the dialysis type the network dialysis clinic offers. If the MA plan covers out-of-network clinics, the patient may be able to get the dialysis type s/e wants at a higher cost.

    • Patients with MA plans could have a large“surprise bill” when a hospital is in-network—but a doctor seen in the hospital is not.

    • MA plans say they pay for things Original Medicare doesn’t cover, but:

    • Dental, vision and hearing benefits vary by plan and have limits.

    • Wellness/fitness benefits, if provided, may be limited to certain sites.

    • Transportation. if provided, may be for a few trips a year—not enough for dialysis.

    • Meals may be delivered a few days after discharge and only a few times a year.

    • Patients can switch from an MA plan to Original Medicare 10/15-12/7 or 1/1-3/31 but may not be able to get a Medigap plan if under 65 with ESRD.

    • MA plan out-of-pocket costs could be higher than premiums for Part B, D, and a Medigap plan if they can get one in their state at their age.

  5. Risks with COBRA3

    • When a Medicare patient who works for a company with 20 or more workers has a COBRA event, the company must offer COBRA. States may have continuation coverage for those who can’t get COBRA.

    • A patient who gets a transplant can choose to keep COBRA or take Medicare. Having Part A coverage during the transplant month allows Part B to pay for anti-rejection drugs then or any time the patient has Part B. Not having Part A during the transplant month means the patient can never use Part B to pay for anti-rejection drugs. Dialysis and transplant programs can bill job-based plans, including COBRA, more than Medicare so patients could have higher out-of-pocket costs.

    • COBRA can last for different lengths of time:

      • 18 months for a worker, spouse, dependents IF the worker quits or hours are cut. A second COBRA event after the first can extend this to 36 months.
      • 29 months IF the worker or family member is found to be disabled.
      • 36 months for a spouse or dependents IF the worker gets Medicare, a divorce, legal separation, or dies.
      • 36 months when a child is no longer a dependent under the plan. Under the ACA, a child can be a dependent until age 26.
    • COBRA premiums are costly, and the company no longer pays part of them.

  6. Risks with individual ACA Qualified Health Plans (QHP)

    • ESRD patients can choose to keep a QHP and not take Medicare when they can get it. But, they face a premium penalty if they apply for Part B later.

    • QHP networks limit choice of where a patient can get dialysis or transplant. Plans may not cover drugs the patient needs.

    • Patients who keep their QHP and don’t have Medicare Part A during the month of transplant can never use Part B for anti-rejection drugs. Part D may cover them, but out-of-pocket costs could be higher.

    • Costs are high for patients who don’t get premium tax credits or help to pay out-of-pocket costs.

    • Congress and states have tried many times to repeal the ACA, and a legal challenge is before the Supreme Court now. This puts millions at risk of losing an ACA plan.

  7. Risks with American Kidney Fund help for premiums

    • Patients who rely on the AKF to pay premiums can lose coverage if the premium notice is not provided in a timely way, AKF’s donated funds limit timely payment, or the plan fails to count the payment on time.

    • Transplant programs may not list those with AKF premium help unless they can afford premiums, healthcare, and anti-rejection drugs. AKF premium help ends the end of the plan year post-transplant.


Risks to society

When the costs of healthcare go up, payers have to pay more. When payers pay more, they raise their premiums to cover their costs and make a profit. As premiums increase, more people can’t afford health insurance. People who can’t afford health insurance don’t get preventive or acute care, have higher costs of illness, and risk themselves and others.


1Christopher P. Childers, Jill Q. Dworsky, Gerald Kominski, Melinda Maggard-Gibbons. A Comparison of Payments to a For-Profit Dialysis Firm From Government and Commercial Insurers. JAMA Internal Medicine, 2019.

2 Investopedia. Pitfalls of Medicare Advantage Plans.

3 Center for Medicare & Medicaid Services. COBRA Continuation Coverage.


  • Neeta Joshi

    Sep 30, 2020 7:04 PM

    Do you have a printable version of this article?
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  • Beth Witten

    Sep 14, 2020 8:15 PM

    Thank you for your real world experience. I appreciate you pointing out that the information that I provided related to your wife's COBRA rights was not correct because the COBRA event was you quitting work vs. any of the other COBRA events. Your being disabled gave her the 29 months of COBRA. Based on your comment, I asked for edits to make the blog clearer for how long COBRA lasts under different conditions. You say you had Medicare prior to the COBRA event (your stopping working). Your employer was supposed to offer you COBRA at that time. Employers are not required to continue COBRA for the employee who gets Medicare after the COBRA event but are supposed to offer COBRA to those who had Medicare when the COBRA event occurs. People who take Part A (free) and waive Part B are limited as to when they can enroll in Part B and they could have a 10% per year premium penalty. When the ACA took effect people who worked for Medicare advised Medicare was better. Dialysis providers make more from ACA and job-based plans and it was to their advantage for patients to stay in ACA plans vs. taking Medicare. They may not have been aware that patients who keep ACA plans when they could have enrolled in Medicare could result in a premium penalty too. Plans lobbied for more money to provide care for people on dialysis and they lobbied to not have to cove kidney acquisition costs which now will be born for MA members by Original Medicare. Starting in January 2021, the out-of-pocket max for MA in-network care will be $7,550 and CMS is allowing MA plans to have a higher out-of-pocket max for in-network and out-of-network care when that's covered.
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  • Jeffrey Stumpe

    Sep 11, 2020 8:01 PM

    Thank you Beth for a brilliantly researched and written article.

    I'd will speak to a few of the key points of the article taken from personal experience.

    "A person with a job-based plan that pays 1st may say “No” if s/he doesn’t know that having Medicare as a 2nd payer can save more than the Part B premium would cost." Absolutely true in my experience. My employer group coverage had been experiencing increased annual deductibles and out of pocket maxes from 2007 through my ESRD with chronic dialysis diagnosis in July 2012.

    The increases in deductible ( to $1800/year) and out of pocket max ( to $4000/year) continued through the termination of my employment (Reduction in Force) on December 31, 2015. My deductible and out of pocket by July 2012 were substantial enough that electing Medicare Part B at that time made no financial sense. 2013 and a new plan year would be a different story.

    I remained skeptical because I had read that Medicare would not pay for deductibles as a Second Payor. I contacted DaVita's Regional Insurance expert, Emily Steffens who reassured me using the experience of many other dialysis patients that Medicare as Secondary Payor would indeed pay for the amounts left from my group plan insurer's claims as deductible or out of pocket.

    I signed up for Medicare B coverage to begin on January 1, 2013 to coincide with my group coverage plan year. Just as Emily Steffens had claimed, Medicare as Secondary Payor, paid any deductible and out of pocket starting January 1, 2013 through December 31, 2014 during my 30 month Coordination of Benefits period as an ESRD patient.

    Effective January 1, 2015, Medicare became the Primary Payor, and my group plan became Secondary. Nothing changed for me, as I paid no deductibles or out of pockets in return for my Medicare premiums through December 31, 2017 (May 2016 new employer, same insurance arrangement).

    In return for between $1200 and $1500 per year in Medicare Part B premiums I saved between $2500 and $2800 per year in out of pocket max's on my group insurance plan. Not a bad ROI!! That permitted me to "save" my employer's HCRA annual contribution of up to $2000/year and leave the employer with a fully portable, never expiring benefit to pay premiums and eligible medical, dental, vision expenses worth $8000, which remains unspent today nearly 5 years later.

    The intelligence of enrolling in Medicare as a secondary payor when eligible is not only an immense economic benefit for a working ESRD patient but also anyone 65 or over working who is covered by employer's group insurance. The same economics apply in return for a reasonable Medicare Part B premium. Yet many "smart" 65 and over working individuals can't conceive of taking on the added expense of Medicare Part Premiums in return for no deductible and no out of pocket on employer group plans that are increasing both virtually every year. They ignorantly do this because they know their respective group coverage satisfies the requirements for coverage that permits them to not have to sign up for Medicare Part B and otherwise incur lifelong premium penalties when they do sign up, and then start paying those premiums in addition to the cost of the employer's group coverage. Medicare Part B premiums may also be tax deductible on many state income tax returns and can be included in the Medical Expenses portion of Federal Income Tax 1040 Part A Itemized Deductions, whereas the pre-tax premiums on employer group plan premiums are not tax deductible.

    I was able to utilize COBRA disability coverage for my spouse when I left work at the end of 2017. That coverage was not made available to me as I has been on Medicare since 2013. That COBRA coverage as specified in the employer's benefits guide book would be limited to 29 months or some 9 months short of my spouse's 65th birthday.

    The article mentions 36 months for COBRA in the event of disability. I believe this would be the case only in the event of some change in coverage, e.g. new eligible dependent or new disability anytime during the first 18 months of coverage which then permits the addition of another 18 month period. In our case, it was limited to 29 months. After COBRA termination we no choice but to research and purchase a "comparable" ACA plan for the 9 months between COBRA termination and start of Medicare eligibility/coverage.

    The ACA plan premium cost selected was 190% of COBRA and required a 200% increase in annual deductible and a 250% increase in annual out of pocket. I'll take the COBRA coverage and premiums any day over the ACA coverage and premiums. Comparatively, my spouse's expected 2021 Medicare premiums and Medicare Advantage Premiums combined will be 12% of the cost of her current ACA plan premiums. Why couldn't she have been born at least 9 months earlier?

    I was able to obtain Medigap (Medicare Supplement Plan - Special Needs Plan for those under 65 on SSA disability) at age 63 when I left work on full disability after some 5-1/2 years working full time as an HHD patient. The next plan year saw my Supplement Plan premium drop by some 43% as I would be turning 65 and was being treated as if being 65 at the start of that plan year.

    I have since seen my Medigap premiums raised every 10 months for the past two years resulting in effective 12% and 15% annual increases all in return for no deductibles and no out of pocket expense for any provider accepting Medicare assignment.

    I recently became aware of CMS changes to Medicare Advantage Plans in 2021 to accept ESRD patients. The article astutely points out that Medicare Advantage Plans carry annual out of pocket maximums of $6700 in addition to monthly premium costs, expenses that are generally covered by most Medigap policies.

    Even with my ever increasing Medicare Supplement Plan Premiums, I know that the 20% paid by my plan amounts to a potential annual out of pocket of no less than $7800 with HHD treatments, monthly labs and nephrologist and the occasional PCP and Dermatology appointment. One fistullogram and declot per year and I'd be up to nearly $10000 in out of pocket on the 20% Medicare Part B leaves to be paid by me or my Medicare Supplement Plan.

    In contrast to my example of the over 65 employee who refuses to sign up and pay for Medicare Part B and leaves $1000's in group plan deductible and out of pocket savings on the table, I won't be quick to sign up for an 2021 MA plan that is going to drop my monthly premium by $100's but will increase my annual deductible and out of pocket maximum by the $1000's.
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