Obama administration officials will decide Monday whether to cut a popular Medicare program further, a move opponents say will lead to higher medical costs for seniors.
The Centers for Medicare and Medicaid Services will decide on whether to install a proposed cut of nearly 1 percent to Medicare Advantage, a program that provides seniors access to private health plans that cover all Medicare benefits.
Medicare Advantage plans can sometimes lead to lower copays or more benefits for seniors, however the insurer can change the benefits every year. In 2014 nearly 16 million seniors, about 30 percent of all Medicare beneficiaries, enrolled in Medicare Advantage.
Major insurance groups and more than 300 lawmakers have came out against the cuts and the potential consequences.
While this proposed cut is small, it is on top of a “nearly 10 percent cut over the last two years” to Medicare Advantage, according to America’s Health Insurance Plans, an insurance industry trade group.
Obamacare also instituted cuts over the past few years to bring the average costs of care closer to the traditional Medicare program. The law also increases payments to physicians that increase their coverage quality.
A report funded by the group estimates that the combined impact of the years of cuts would cost seniors about $60 to $160 per month. For seniors “on fixed income that is a lot of money,” spokeswoman Claire Krusing told the Washington Examiner.
The plans are also very popular with seniors. A survey of nearly 1,500 seniors on Medicare Advantage found that 88 percent were satisfied with their plan, according to the research firm Morning Consult, which conducted the poll at the end of last month.
The Better Medicare Alliance, supported by several insurers such as Humana, UnitedHealth and Aetna in addition to doctor and patient advocacy groups and business groups, argues that Medicare Advantage access in rural areas has lowered in the past few years. This year Medicare beneficiaries in 211 counties have no access to Medicare advantage, up from 55 in 2012, the alliance said.
The campaign has received significant support from more than 300 House and Senate lawmakers that wrote to CMS recently clamoring to preserve current Medicare Advantage rates.
“These plans are particularly important for low-income beneficiaries who are financially vulnerable, as well as rural and minority populations who are seeing fewer plan choices,” said Sen. Chuck Schumer, D-N.Y., in a press release in February.
The alliance told the Washington Examiner that it is not trying to re-litigate the Affordable Care Act cuts.
“What we are really trying to work toward is stopping additional cuts,” said interim executive director Krista Drobac.
The alliance has funded digital and print advertisements to generate support against the cuts. AHIP did a digital campaign.
Both groups declined to say how much was spent on their respective advertising on the issue.
For insurance companies, any cuts to Medicare Advantage will have some impact on the bottom line, as some rely on federal funding.
For instance, nearly 54 percent of insurance giant Humana’s premium revenue in 2014 came from Medicare Advantage payments, the company’s annual investment report said.
