An individual turning 65 navigates to the Medicare website to learn about enrolling in Medicare.
Adelola was turning 65 years old but did not want to enroll in Medicare. (Note: Adelola is a real person, but her name has been changed to protect her privacy). She was worried she would not be able to afford to pay for Medicare premiums and would rather risk being uninsured; however, as a resident of Massachusetts, which requires all residents to have health insurance, Adelola must either enroll in Medicare or pay a tax penalty.
When Adelola visited her local Social Security office to apply for retirement benefits, she learned that she was not yet eligible for Supplemental Security Income (SSI) or the premium-free part of Medicare benefits. Both programs require beneficiaries to work for forty quarters in the U.S. (and to pay SSI taxes) in order to receive SSI and the premium-free part of Medicare, which covers hospital services. Although Adelola had been working in the U.S. since she emigrated from Nigeria, she was three quarters short of the forty required to qualify for both of these benefits.
On the Social Security side, Adelola simply needed to work more to receive benefits and would not face any negative consequences for waiting to apply. For Medicare, however, she not only faced penalties from the state for not having insurance, but she was also at risk of being locked out of receiving hospital coverage through Medicare in the future and of incurring lifetime financial penalties for not enrolling in Medicare when she was first eligible.
Unsure how to handle this case, the Social Security specialists referred Adelola to the SHINE (Serving Health Insurance Needs of Everyone) program, which is the Massachusetts’ version of the State Health Insurance Assistance Program (SHIP). SHIP is a federally funded state program for individualized health insurance counseling for Medicare beneficiaries. During her counseling session, the SHINE counselor told Adelola about the Medicare Savings Program, a state-funded program helps low-income individuals that are ineligible for premium-free part of Medicare pay their premiums. Relieved, Adelola signed up for this program which allowed her to enroll in Medicare and avoid both a state tax penalty for being uninsured as well as lifelong financial penalties on her insurance premiums.
Background
Enrolling in Medicare at the standard age of eligibility, 65, can be confusing and burdensome to many applicants. This leads to the most vulnerable seniors—like Adelola—forgoing the healthcare coverage they need. Adelola was eventually directed to the right resources to serve her situation after multiple office visits and consultations. But not every senior ends up being able to navigate the Medicare enrollment process to completion.
What makes Medicare enrollment so complicated?
As Adelola’s experience demonstrates, enrolling in Medicare can be a confusing, multi-step process. Medicare enrollment involves multiple federal agencies, including at least the Social Security Administration (SSA) and the Centers for Medicare and Medicaid Services (CMS). Any issues with an enrollee’s application can lead to several trips to different offices.
In addition to this multi-agency process, enrolling in Medicare involves making numerous choices. First, enrollees must choose between original, fee-for-service Medicare or its private managed-care alternative, Medicare Advantage. If they choose original Medicare (which covers both hospital and outpatient services), then they must choose whether or not to purchase supplemental coverage to protect them from potentially high out-of-pocket costs since original Medicare involves cost-sharing. Enrollees can also choose among different prescription drug plans. Those that select Medicare Advantage must then navigate a crowded landscape of private insurers and insurance options in order to choose a plan. This wide and complex array of choices makes it difficult for people to make effective choices for their personal situations.
Lack of timely enrollment during the small window around one’s 65th birthday can lead to financial penalties for life. For example, over 700,000 Medicare beneficiaries receiving coverage for outpatient services paid financial penalties in 2017 for late enrollment, and their total premiums were 31% higher than what they would have been had they enrolled during their eligibility window, according to the Congressional Research Service. Given the complexity and high stakes, there are a wide range of nonprofit organizations and for-profit agents and brokers that help seniors through the enrollment process—but they can also increase confusion and add on costs for the beneficiary.
The Problem
According to CMS, there were 58 million beneficiaries enrolled in Medicare in 2017. As the American population ages, enrollment is expected to rise to more than 80 million by 2030 according to a report by the Medicare Payment Advisory Commission.
This is why the US Digital Service team at CMS and the SSA have joined together to improve the Medicare enrollment process. These teams have never collaborated before but saw value in studying the entire enrollment process across the various agencies the process may touch. They are interested in investigating the following question:
How might we adapt the Medicare enrollment experience for those aging into Medicare (i.e., individuals turning 65 years old) to focus on increasing simplicity, positive user experience, and clarity?
Introducing Our Team
Robert Teller of SSA, along with Misu Tasnim, Jessica Weeden, and Benno Schmidt (not pictured) of CMS, meets with our Harvard team on the first day of class.
As part of the “Technology and Innovation in Government” course at the Harvard Kennedy School, taught by former U.S. Deputy Chief Technology Officer, Nick Sinai, our team of Harvard students is working with CMS and SSA on this project to improve Medicare enrollment. Our diverse backgrounds provide us with an interdisciplinary approach to this challenge:
Christina Wu (MPH ‘20) is interested in applying design principles to improving the healthcare and social service systems for vulnerable populations, particularly aging individuals. Christina previously worked in healthcare consulting, supporting clients including the Center for Medicare and Medicaid Innovation (CMMI), the Department of Housing and Urban Development (HUD), and state Medicaid agencies. She is experienced in digital health and managed care, and completed a Fulbright fellowship researching dementia care in China. Christina recently began working as a barista so that she can finally learn the difference between a latte and a macchiato.
Mia Mayixuan Li (MPP ‘21) is interested in introducing innovative technologies to strengthen good governance and improve the quality of service delivery in the developing world. Mia previously worked for the United Nations Development Programme (UNDP) in China, where she developed communication strategies and managed projects in a broad range of development areas. Mia is a cocktail enthusiast and she makes excellent pisco sour.
Gwendolyn Lee (MPP ’20/ UCLA MD ‘22) is interested in the intersection between health policy, population health, and digital health innovation. Gwendolyn previously worked at the Massachusetts Health Policy Commission. She currently sources ventures using artificial intelligence and health tech for Innospark Ventures and Flare Capital Partners. Gwendolyn co-founded the Harvard Kennedy School Latin Dance Society and loves bringing people together through dance.
Melia Henderson (College ‘20) is interested in building technology to help solve issues within the government. Melia previously worked as a software engineer as well as a consultant at Boston Consulting Group (BCG) and product manager at Digital Ventures, BCG’s technology incubator. She has done research in the security of government technology such as the 2020 US Census. Melia has never broken a bone.
Rob MacGregor (MPP/ Wharton MBA ‘22) is interested in leveraging business and technology to mitigate public sector challenges. Rob previously worked in investment banking, private equity, and venture capital. He also spent two years with the Clinton Health Access Initiative where he primarily advised the Government of Uganda on HIV funding and supply chain issues. Rob enjoys hiking and once climbed a volcano in Democratic Republic of Congo (DRC) which has the largest active lava lake in the world.
Next Steps
The first stage of the project involves interviewing people going through the Medicare enrollment process or who have recently enrolled in Medicare. We are trying to understand the different ways 64-year-olds enroll in Medicare, and how each individual experiences the enrollment process. We are also speaking with other key stakeholders and subject matter experts that support these individuals through the enrollment process, including specialists at a regional Social Security office, the Massachusetts Executive Office of Elder Affairs, SHINE programs at local Councils on Aging and senior centers, health plans, and insurance brokers.
We look forward to spending the semester learning from people like Adelola to understand the challenges they face in enrolling in Medicare. Based on what we learn, we aim to develop recommendations and test potential solutions that will make the process easier for all seniors.
If you want to learn more or have thoughts on our project, please contact us at innovategov.medicareenrollment@gmail.com. Stay tuned!
— Melia Henderson, Gwendolyn Lee, Mia Mayixuan Li, Rob MacGregor, and Christina Wu