Medicare Advantage Increases Popularity Despite Obamacare Cuts

Medicare Advantage continues to flourish despite Obamacare cuts

By Chris Berry

Amidst the dysfunction within the new Obamacare insurance marketplaces, one existing coverage program appears to be flourishing.

One of the most severe and initial criticisms of President Obama’s health care law was that it would come as a detriment to seniors. Critics contended that the law’s $700 billion in cuts to Medicare over 10 years would withhold both benefits and choices from seniors. In particular, it was feared that the $100 billion cut from Medicare Advantage, which enables seniors to acquire government-funded private insurance plans in place of traditional Medicare.

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However, four years later the program has reached new levels of popularity. Between 2010 and 2013, enrollment in the program jumped 30%.

Despite the progress, some Republicans contend that the program is in jeopardy due to Obamacare. “The chances are that soon [seniors] will open up the mail to the bad news that your Medicare Advantage … has been changed in a negative way for you because of Obamacare,” said Senator Marco Rubio recently, paying no mind to the stability of premiums, plan choices and benefits under Medicare Advantage.

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“So far, the concerns have not been borne out,” says Tricia Neuman, a senior vice president at the Kaiser Family Foundation who studies Medicare Advantage. “Enrollment continues to climb. Some of the forecasts have predicted that plans would pull out and people would drop out — so far it hasn’t happened.”

Medicare open enrollment begins on Oct. 15, and close to 14 million seniors who choose Medicare Advantage will discover options are improved at only a slight raise of cost that in the past. According to the U.S. Department of Health and Human Services (HHS), which oversees Medicare, the average monthly premium of Medicare Advantage will increase by only $1.54 in 2014, from 2013. Regarding benefits and cost sharing, Gretchen Jacobson, also of Kaiser, says, “We haven’t seen dramatic changes.”

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Medicare Advantage was originally chosen for cuts because the the government was spending close to 14% more per enrollee in the program than for those enrolled in standard Medicare.

While cuts on Medicare Advantage will continue until 2017, thus far, the program has not suffered.

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