Confused about Medicare Advantage plans for 2014?
Not sure which Medicare plans for 2014 is best for you?
In 2014 Medicare Advantage plans are preparing for big changes. Recently Forbes magazine mimiced what we have been telling people since 2011 - big cuts are looming for Medicare Advantage plans. New rates proposed by the Centers for Medicare and Medicaid Services, a.k.a. CMS, will be “enormously disruptive” according to the Forbes Magazine article. (Link to Article)
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2014 Medicare Advantage Plans
Medicare Advantage Plans for 2014
According to Forbes and Citibank managed care analyst Carl McDonald the proposed changes to MA reimbursement will “have the net effect of reducing payments to Medicare Advantage plans by 7 to 8 percent in 2014”. “This includes the 2.3% reduction in per capita growth rate announced by CMS on Friday, and estimated 2-3% drop as rates move to parity with fee for service…a 1.5% reduction associated with the change in coding intensity adjustment” and the 2% health insurance premium tax. “These negatives are partially offset by an estimated 1% benefit from improved Star quality ratings, re-basing, better risk scores, and fee for service normalization, resulting in an overall decline of 7-8%,” wrote McDonald yesterday in a note to clients.
As of this date CMS has not finalized the Medicare Advantage reimbursement rates for 2014 but you can be sure whatever cuts get minimized this year they will show up again in the near future. You see, CMS does not like Mediare Advantage plans because the insurance companies make money and that would hurt their efforts to make Medicare the default insurer for everyone. This of course means more power for CMS and the Federal government. Of course the choice is yours, and we've partnered with the Senior Advisors Group to help you select the best plan for you. They are independent and represent over 50 Medicare Advantage, Medicare Part D and Medicare supplemental insurance plans in 38 states. They have no affiliation and no bias to any one plan.
What we’ve been recommending to those who can afford the additional cost is the traditional Medicare Supplemental Insurance plan a.k.a. “Medigap”. For those where cost is a significant factor in their choice of course as long as Medicare ADvantage remains more affordable that may work for you. HOWEVER, we would suggest individuals consider Medicare Supplement Plan N. The Supplemental Plans N will provide more flexibility in what doctors you can see and lower out of pocket cost if/when you get sick and need it most.
For assistance making your choice whether it’s Medicare Advantage or Medicare Supplemental insurance you can get advice from the Senior Advisors Group.
AHIP study: Medicare Advantage cuts will drive up premiums
Seniors would likely see significant premium hikes and benefit cuts under proposed cuts to Medicare Advantage plans, according to a study commissioned by the insurance industry.
In a study released by America’s Health Insurance Plans (AHIP), the consulting firm Oliver Wyman said Medicare Advantage plans are facing a total cut next year of roughly 7 or 8 percent.
That would translate into benefit cuts or premium increases worth $50 to $90 per month for each senior who uses Medicare Advantage, according to Oliver Wyman.
The federal Medicare agency recently said it plans to cut Medicare Advantage payments by 2.3 percent next year — on top of significant cuts included in President Obama’s healthcare law.
All told, Medicare Advantage plans would be absorbing a total cut of 6.9 to 7.8 percent, according to Oliver Wyman’s report, and those cuts would translate into benefit cuts or premium increases for seniors.
It’s hard to predict how plans would balance those options, but they would have to cut benefits or raise seniors’ costs by $50 to $90 per month to make up the difference.
By Sam Baker - 02/26/13
Read complete article: http://thehill.com/blogs/healthwatch/medicare/284955-ahip-study-medicare-advantage-cuts-will-drive-up-premiums#ixzz2MJPCBx58
UPDATE!! In a stunning turn around CMS announces that there will not be a cut in 2014, instead reimbursement will go up in 2014. Could it be that 2014 is an election year? Watch out , MA plans seem to have become a significant political football.
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