WASHINGTON -Ways and Means Committee Chairman Sander M. Levin (D-MI) and Ways and Means Health Subcommittee Chairman Pete Stark (D-CA), today commented on news that the Medicare Advantage (MA) program is working better for beneficiaries. The Centers for Medicare and Medicaid Services (CMS) today released their landscape for 2011, which details the number and availability of MA and Part D plans, and premium and cost sharing levels for each.
Chairman Levin: “Health reform has always been about making the system work for the American people and today’s news confirms that Medicare Advantage is still a strong program. Despite Republican fear-mongering, and thanks to the efforts of the Democratic Congress and President Obama, seniors are getting a better deal - they still have many Medicare Advantage plans from which to choose and will benefit from reduced costs. Furthermore, many Medicare beneficiaries are now enjoying better benefits and are protected from excessive increases in cost-sharing and premiums."
Chairman Stark: "The Medicare Advantage program is stronger after improvements made by Democratic Congresses. Premiums are lower and seniors are saving money on out-of-pocket costs. Thanks to the health reform law, the Administration was able to curb excessive hikes in cost sharing and premiums. Republicans would repeal this authority and stand with insurance companies that are gouging seniors."
The report included the following highlights:
* Beneficiaries in Medicare Advantage Plans will see an Average Reduction of One Percent in Premiums in 2011. According to analysis by CMS, on average, Medicare Advantage premiums will be one percent lower in 2011.
* Affordable Care Act Saved Beneficiaries $150 Million in Out-of-Pocket Costs. Using new authority made law as part of the Affordable Care Act, the Secretary of Health and Human Services is protecting Medicare beneficiaries from excessive increases in cost-sharing and premiums in 2011. Secretary Sebelius used Section 3209 of the Affordable Care Act to identify 300 plans that were outliers and successfully negotiated more reasonable cost-sharing and premium increases with 298 of these Medicare Advantage plans. These changes will save beneficiaries in those 298 plans an average of $13 per beneficiary per month - which translates into $150 million in savings for beneficiaries.
* Beneficiary Access to Medicare Advantage Plans is Virtually Unchanged. Despite predictions that health insurance companies would pull out of the Medicare Advantage market, the 2011 landscape is virtually unchanged from 2010. Next year, 99.7 percent of beneficiaries will continue to have access to a Medicare Advantage plan.
* Medicare Advantage Market is Strong: Plans Predict Five Percent Growth in Market. Despite predictions that the Medicare Advantage market would decline, the CMS landscape notes the health insurance industry itself predicts a five percent growth in the Medicare Advantage market.
In their second quarter earnings announcements, insurance companies stated that they forsee growth in the Medicare Advantage marketplace:
* UnitedHealth Group CEO Stephen Hemsley: “Health-care reform has put a new kind of dynamic into the marketplace around affordability and the need to modernize and simplify" medical care, Hemsley said. “We’re pretty positive as to what the prospects could be." [https://www.bloomberg.com/news/2010-07-20/unitedhealth-profit-jumps-as-medicare-medicaid-grow.html)]
* Humana CEO Mike McCallister: “With our singular focus on delivering to seniors we serve with a value above the traditional Medicare program and with the coming age wave of baby boomers turning 65, we believe our Medicare business will not only remain solid but will continue to grow." [Humana Inc. Q1 2010 Earnings Call Transcript, April 26, 2010]
* WellPoint CEO Angela Braly: “We recently submitted our 2011 Medicare Advantage bid and expect to be well-positioned for the open enrollment period. We have been improving our service and offerings in the Medicare Advantage marketplace for more than two years now, and continue to believe that there will be strong demand for Medicare Advantage products as the overall senior market grows." [WellPoint Q2 2010 Earnings Call Transcript, July 28, 2010]
