Premiums for a popular alternative to traditional Medicare will be slightly cheaper on average next year, the Obama administration announced Monday.
Medicare Advantage plans, which cover about 30 percent of all elderly Americans, will cost an average of $32.60 per month next year, 31 cents lower than this year, according to the Centers for Medicare and Medicaid Services. And a majority of Medicare Advantage enrollees, about 59 percent, won’t see their premiums increase at all, the agency said.
The announcement comes as good news for the White House, which has faced GOP charges that cuts to Medicare Advantage under the Affordable Care Act would hurt the program and discourage seniors from enrolling in it.
Despite the cuts, popularity of the health insurance program has grown and is projected to cover 32 percent of all seniors next year. Between passage of the 2010 law and 2016, premiums are projected to decrease by nearly 10 percent and enrollment is projected to increase by more than 50 percent, CMS said.
Unlike traditional Medicare, the federal government pays private plans to cover seniors in Medicare Advantage, which Congress passed in 2003. The plans competitively bid as a way to keep prices down.
The agency also said premiums for Medicare’s prescription drug program will be “stable” next year, with the average premium costing $32.50 per month. While cutting funds from Medicare Advantage, the healthcare law provided more funding for the prescription drug program.
“Seniors and people with disabilities continue to experience stable premiums in Medicare health and drug plans while benefiting from a transparent and competitive marketplace,” said CMS Deputy Administrator Sean Cavanaugh. “Medicare Advantage and prescription drug plans remain affordable and provide high quality care.”
