It’s the biggest product launch in years, but it’s not happening in a vacuum: Blue Cross & Blue Shield of Rhode Island and UnitedHealthcare of New England, who together pretty much own the Rhode Island health insurance market, will now go head to head with 15 competitors.
And it’s not even one product against another – it’s more than 50 plans, including stand-alone prescription drug coverage as well as Medicare Advantage plans.
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How do you explain, to a 70-year-old who’s already feeling overwhelmed, why Blue MedicareRx Option 1, with this and that feature, is a much better deal for her than, say, CIGNA’s Plan 00302, or WellCare’s Complete plan?
“There’s going to be a lot of white noise in the marketplace from all these 17 participants, including some very large national vendors,” said James Gallagher, assistant vice president for sales at Blue Cross. “There’s going to be a lot of marketing dollars spent here.”
As he sees it, though, it’s not necessarily a bad thing.
“There will be some confusion,” he said, “and when that happens, you go back to what you’re comfortable with.” What’s more familiar than Blue Cross?
It’s been three weeks since the Centers for Medicare & Medicaid Services officially unveiled the full roster of plans that Rhode Island seniors – and their counterparts across the country – would be able to choose from for their new Medicare “Part D” prescription benefit, but since then, it’s been mostly quiet in the marketplace.
That’s because the official marketing period hasn’t begun yet; Gallagher said many of his company’s materials are still being vetted by the CMS.
But “we’re very busy over here,” he said. In preparation for the Nov. 15 launch of the open enrollment season, Blue Cross is preparing “pre-enrollment kits,” he said, as well as ads to place in the local media and more in-depth materials to send out in direct mail.
The insurer is also planning “educational meetings” for Rhode Island residents, starting the first week of November, Gallagher said.
At United, the outlook is a bit different. Although Blue Cross banded together with other Blue plans in the region to offer a common product array, the marketing and sales are, essentially, local affairs, but at United, it’s a national effort.
United’s products for seniors are run by a division called Ovations, which spokeswoman Joyce Larkin, said is the only company offering the full spectrum of Medicare-related products across the United States.
For budget-minded seniors, United appears to have the most aggressively priced offering of all: two of its four Medicare Advantage plans (Medicare managed care) include no surcharge at all for the drug coverage. Blue Cross’s Advantage plans, by contrast, are priced at $27.93 to $46.70 per month for the prescription benefit.
Larkin said she expects those zero-premium plans to be particularly attractive. In addition, none of United’s prescription-only plans requires a deductible, Larkin said, even though Medicare guidelines provided for up to a $250 deductible. (In reality, however, all but three of the prescription-only plans to be sold in Rhode Island are deductible-free.)
Price is only part of United’s pitch, however. Just as important is the company’s national reach – Larkin said about 90 percent of the nation’s pharmacies are in the United network – and its experience serving seniors.
“We’ve been operating in Medicare for 20 years,” Larkin said. “We see Part D as kind of an extension of what we’ve already been doing.”
To reinforce that message, Ovations has also been aggressive on the “education” front, most notably by producing a 24-page “Show-Me Guide” on the Medicare prescription benefit that has been distributed nationwide, about 9 million copies in seven languages.
“We’ve put a lot of emphasis on education and information,” Larkin said.
Asked whether she expects the new benefit to make an impact on United’s share of the broader 65-plus market, Larkin said she doesn’t know – it’s too soon to tell.
At Blue Cross, Gallagher said he expects the roughly 40,000 seniors who are already enrolled in the company’s Medicare Advantage plans, and the roughly 21,600 who are enrolled in Plan 65 (Medicare supplemental coverage, or “Medigap”) to stick with what they have and just add prescription drug coverage.
“I don’t think it will be a dramatic shift in our marketplace today,” he said.
But as a new wave of Rhode Islanders turn 65, Gallagher said, he does expect a shift.
Given how inexpensively they can get not just Part D coverage, but the whole package of health services, he said, “it will be very attractive” for them to take Medicare Advantage plans.
