Monday, April 1, 2013

Medicare Advantage Might Get Expensive In 2014

Excerpts taken from CNN article written by Jen Christensen

The Medicare Advantage coverage plan could soon cost more, according to an announcement expected Monday. The Centers for Medicare and Medicaid Services (CMS) will announce on Monday the final Medicare Advantage rates for 2014, which are expected to be cut, saving the government money -- but potentially costing the public more.

CMS had first proposed a 2.3% reduction in what the government pays the insurance companies that provide Medicare Advantage plans. Upset, the insurance companies have spent the public comment period time lobbying legislators and running ads against the cut.
Ads from the America's Health Insurance Plans' Coalition for Medicare Choices called the proposal "drastic" and "too much" and featured seniors saying they can't afford to pay more for health care.
x About 25% of the 47 million Americans on Medicare pay more to have Medicare Advantage. The plans are run by private insurance companies that are reimbursed by the government for doing so. The plans vary, but they offer the elderly more than they would get with regular Medicare. Most plans offer prescription drug coverage; some also offer dental and vision. All the plans cap a person's out-of-pocket expenses, while regular Medicare does not.

The rate reduction, which is a part of the Obama administration's ongoing effort to save money on the program, comes on top of other reductions that all go into effect at about the same time. The result is an unusually large reduction ... about 8% less.
x Seniors won't know what the out-of-pocket costs these cuts will bring until the fall. That's when the insurance companies put in their bids for the government work. By law, those out-of-pocket expenses can't go up by more than $30 more per month. That doesn't sound like a lot, but it can add up for seniors on a fixed income.

Source CNN.  Jen Christensen