How would the proposal affect Medicare Advantage (MA)?
An estimated 23% of Medicare beneficiaries are currently enrolled in MA – managed care plans administered by private insurance companies. On average, these plans are currently paid 14% more than the traditional fee-for-service program – up to 20% more in some parts of the country. This means that Medicare pays an average of $1,138 more this year for an MA enrollee than it does for a traditional program enrollee. The MA overpayments also increase premiums for all beneficiaries by $3.60 per month. Several years ago, MA plans were paid 5% less than the traditional program, under the assumption that they were more efficient and could save the program money. The Senate bill’s reductions in MA payments could lead plans to limit benefits, raise their premiums, or withdraw from the program. The extra benefits that could be cut include such items as eyeglasses, hearing aids, and health club memberships. Some MA enrollees may see increases in their premiums. Some will have to go back into an imp
