By Ana B. Ibarra, Kaiser Health News
Last year, Frank Mirabella underwent sinus surgery that racked up a hospital bill of almost $23,000.
He expected Medicare to pay for it. But Mirabella, 76, received a letter from Sutter Health, a large health system in Northern California, explaining that the federal health program for seniors wouldn’t cover the surgery because he had an old, still-open workers’ compensation case.
As far as he knew, there was no open case, Frank’s wife, Sonya Mirabella, 82, said. She said she called the hospital and Medicare many times to sort it out, bouncing from person to person with no resolution.
“We thought about getting a lawyer because we couldn’t straighten it out,” Sonya said. “By this time, I was in tears.”
The Redwood City, Calif., couple then sought help at the local office of the Health Insurance Counseling and Advocacy Program (HICAP) in San Mateo County. If not for HICAP’s legal assistance, Frank’s Medicare glitch might never have been resolved, Sonya said. Almost 11 months later, Medicare paid its portion for the surgery.
This counseling program and others around the country are now at risk of losing the federal money that keeps them running.
The Trump administration is proposing dramatic cuts to the State Health Insurance Assistance Programs (SHIP), collectively known as HICAP in California. Trump’s budget would slash SHIP’s $52 million annual budget by $49 million, effectively ending federal support of the program.
The administration justified the proposal by noting that Medicare beneficiaries have other sources for reliable information, such as the federal 1-800-MEDICARE helpline.
Those cuts could reduce funding for California’s program by 40 percent, according to the state’s Department of Aging. Still, California’s 24 HICAP counseling programs, which also receive state funding, would be in better shape than many others that don’t, said Bonnie Burns, a policy specialist with California Health Advocates, a nonprofit that provides advocacy support to Medicare-related programs, including HICAP.
Even so, “it would be a tremendous loss, no doubt,” Burns said. Advocates would look for ways to offset the loss, possibly turning to state lawmakers for more money, she said.
Christin Hemann, a Department of Aging spokeswoman, said the proposed federal budget cuts would severely hinder California’s ability to sustain HICAP services.
In 2014-15, HICAP helped more than 511,000 Medicare beneficiaries in California, who saved an estimated $23.67 million, according to state data.
HICAP saves money for people on Medicare by helping them enroll in more cost-effective plans, appealing billing errors and getting them help with outstanding bills or penalties — all of which the program’s mostly volunteer counselors are trained to do, advocates say.
Mariko Nakabayashi, a managing attorney with Legal Services of Northern California-HICAP, said most of the seniors it serves are new enrollees who need help navigating the complicated Medicare system.
Last year, the Northern California HICAP provided services to 5,146 Medicare beneficiaries in the nine-county area where it operates.
Because beneficiaries face so many choices when they enroll in Medicare and supplemental coverage, it can be overwhelming, Nakabayashi said. In Sacramento alone, seniors have 11 Medicare health plans and more than two dozen prescription drug plans to choose from, she said.
And as in the case of the Mirabellas, HICAP also provides legal counseling on Medicare rights and offers advocacy when services are denied.
The potential demand for counseling continues to grow as about 10,000 Americans turn 65 every day and become eligible for Medicare.
Howard Bedlin, vice president of public policy and advocacy at the National Council on Aging, said federal funding for SHIP has been flat since 2011. “We’d like to see an increase, but that’s not realistic at this point,” he said.
This isn’t the first time federal lawmakers have sought to cut funding for SHIP. Bedlin said members of Congress don’t always understand Medicare’s complexity. But once they realize how these assistance programs help millions of people, they usually support its funding, he said.
Henry Hutchins, who declined to share his age, said he hopes the program will continue. The retired accountant from Fremont, Calif., said he was never told he would need additional coverage on top of basic Medicare, even though he is on a kidney transplant list and needs regular dialysis. To his dismay, he later learned that his out-of-pocket expenses were too high because he hadn’t purchased supplemental insurance, and he’d missed the enrollment window to do so.
The HICAP program in Alameda County helped him get on a plan that covered the portion of his treatment costs that Medicare didn’t. “I consider myself a fairly bright guy, but some of this stuff is really complicated,” Hutchins said.
Jennie Klenow, 68, of San Mateo, found herself in a sticky situation, when her 49-year-old daughter Kim McDaniel, who also qualifies for Medicare because of her disabilities, was dropped from her plan due to an apparent glitch, she said.
“We didn’t understand why, and no one could explain it to us,” Klenow said.
They tried the 1-800-MEDICARE helpline first, but Klenow said her daughter’s situation was much too complicated for the line operators. It was only after spending hours with a HICAP counselor that her issues were resolved.
“If anything is a worthy program, this is it,” Klenow said.
This story was produced by Kaiser Health News, which publishes California Healthline, a service of the California Health Care Foundation.
- Also read our article with some action steps to support HICAP and SHIP funding: President’s Proposed Budget Would Eliminate SHIP Funding.