2. True. Managed care plans can refuse to pay for tests and treatment your doctor determines you need. Or they can pay health care providers in a way that creates financial disincentives for expensive treatments you may need.

3. False. You may now legally choose unmanaged private fee-for-service insurance by adding your own money on top of the government payment. For the higher premium, your insurance will pay for treatment and tests your doctor determines you need, without prior permission from the insurance company.

4. True. In dollars, the price of health care has been rising, most years at a higher rate than average inflation. In real economic terms, however, taking rising incomes into account health care prices have actually been falling.

5. True. An "open season" period allows Medicare beneficiaries to choose among competing insurance plans each year.

6. False. If treatment is outside Medicare's scope of coverage, a Medigap policy may help. But the real danger is that when in a hospital you may be denied treatment that is inside Medicare's scope of coverage as a result of managed care techniques. A Medigap policy is forbidden from covering such treatment.

7. True. Unless taxes are raised substantially (which is unlikely for political reasons), the coming retirement of baby boomers will mean less Medicare payments for each beneficiary (when medical inflation is taken into account) than today. That means today's workers must save now so they will be able to supplement government payments in order to get unrationed insurance tomorrow.

Originally published in VSHL Lifesaver August 1999.