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Medicare Advantage: From the Frontlines

Enrolling dead people, forging signatures, stealing private information and conning elderly Americans into signing up for private health care plans they don't even want. This is just a sampling of the scams involving the sale of Medicare Advantage private fee for service plans nationwide, according to a nationwide series of interviews with State Health Insurance Assistance Program (SHIP) representatives conducted over the last month in 27 states by CBS News. SHIP counselors are part of a national program that assists people with Medicare concerns.

"Beneficiaries are not comfortable with saying no," Kristen Barge of Georgia's SHIP office. "They're a trusting generation. These people just want someone to talk to. So somebody calls them, sits with them and suddenly they are in a new plan."

Other SHIP counselors say the complexity of the new privatized plans have overwhelmed some seniors who on average have 41 plans to choose from.

Cynthia Hylton, a State Health Insurance Benefits Advisor in Oregon says seniors would have to be rocket scientists to keep up with the confusing changes in the Medicare Law. Jo Murphy of Michigan's Medicare and Medicaid Assistance Program tells CBS, "One elderly couple came for counseling and he looked at his wife and said "I used to run a bank why don't I get this?' This is a couple who had their wits, but even for this guy it was frustrating."

According to Jill Leach at the Central Maine Area Agency on Aging, trusting seniors fell victim to a pastor who moonlighted as an insurance agent and used his privileged position to rake in sales and commissions. Leach says, "Seniors were saying 'he wouldn't lie to me he's a pastor.'" Leach says the minister's tactics were effective, resulting in at least 20 seniors calling her office to complain. Maine's Bureau of Insurance confirms they are investigating the complaints.

Overall, The Centers for Medicare and Medicaid Services (CMS), which runs Medicare, says they have received 2,700 complaints about deceptive marketing of Medicare Advantage - a small number, they say, in comparison to more than 8 million Americans on private Medicare plans.

But for those seniors who are duped there is little recourse. "Many people are still trying to recover from the damage of being enrolled in this plan," says Brenda Clegg-Boodram, the acting president of The Judicary House, a property owned by the DC Housing Authority that houses seniors and disabled residents. Clegg-Boodram testified before Congress that two insurance agents, under the pretense of selling drug coverage, enrolled her tenants in Medicare Advantage. The change, she said, prevented many from receiving much needed medical attention and medicines.

In mid-June Medicare announced that seven of the biggest plans would voluntarily put marketing on hold. But CBS News has learned that other plans - not in Medicare's agreement - are continuing their marketing, with commissions as high as $750 per new enrollee.

In the meantime, the nation's 12,000 SHIP counselors say they are busy dis-enrolling seniors who have been duped into signing up. Many tell CBS that seniors find it's easier to get into the program than to get out. SHIP counselors blame poor inter-agency communication, inadequately informed representatives and wait times of up to 90 minutes on Medicare's helpline 1-800- Medicare.

CMS says there is a backlog of 1,400 people trying to get off Medicare Advantage. Many of these dis-enrollments are stuck at IntegriGuard - a private contractor responsible for moving beneficiaries between plans.

Medicare urges any seniors with problems or questions to call 1-800-Medicare. They say the average wait is about seven minutes.

With additional reporting by Patricia Alulema and Shaleem Thompson