GOP: Medicare Advantage will see enrollment drop, cost rise by 2014

Insurers operating Medicare Advantage plans should be concerned that once the star-rating bonus program ends in 2014, the health reform law's cuts will result in a significant enrollment drop, Republican lawmakers alleged.

The reform law calls for $308 billion in cuts to Medicare Advantage plans over the next 10 years, including $156 billion in direct cuts to private insurers, which could negatively impact enrollment and benefits, as well as lead to higher cost sharing, reported Politico.

What's more, only 4 percent of those reductions have gone into effect, Rep. Wally Herger (R-Calif.) said during the hearing, MedPage Today reported.

That's why, despite HHS's announcement that Medicare Advantage enrollment has grown 28 percent, America's Health Insurance Plans has "serious concerns" about the impact of the funding cuts. "Because the vast majority of the ACA's cuts to the Medicare Advantage program have not yet taken effect, beneficiaries have not yet felt their full impact," AHIP President Karen Ignagni said Friday at a House Ways and Means Health Subcommittee hearing.

The Medicare Advantage cuts could mean a loss of 10.7 million members by 2019, a 23 percent drop from the pre-reform law Medicare Advantage enrollment, Ignani said. Plus, "the continued erosion of Medicare Advantage funding eventually would lead to increased costs for beneficiaries and reduced access to health plans that are demonstrating better performance on quality," she added.

To learn more:
- here are the House hearing statements
- see the Politico article
- read the MedPage Today article

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