The Impact of the ACA on Medicare Advantage
Posted on March 22, 2011 by AHIP Coverage
The ACA cuts more than $200 billion from the Medicare Advantage program ($136 billion directly and another $70 billion indirectly) which will result in seniors facing higher premiums; a reduction in additional benefits; fewer health care choices; and higher out-of-pocket costs as well.
New CBO Projections:
CBO released its March 2011 Baseline last week. The following are projections showing the impact of the ACA on Medicare Advantage:
CBO is projecting MA enrollment declines from 11.7 million enrollees in 2011 to 7.5 million in 2018 and 7.8 million in 2019.
CBO is projecting MA enrollment as a percentage of total MA enrollment decreases from 24% today to 13% in 2019.
“The Patient Protection and Affordable Care Act substantially alters Medicare Advantage and, as a consequence, reduces the access of senior citizens and the disabled to quality health care by restricting and worsening the health care plan options available to them.”
“About three-fourths of the cuts will hit those with incomes of less than $32,400 per year in today’s dollars.”
“The loss of benefits will also vary widely by geography, with beneficiaries in the hardest-hit counties facing cuts almost five times as large as cuts for residents in the least-hit counties. In every county, the average beneficiary will lose at least 15 percent of his or her benefits.”
“According to the Office of the Actuary at the Centers for Medicare and Medicaid Services (CMS), by 2017, when the changes are fully phased in, 14.8 million senior citizens and disabled Americans who would have had Medicare Advantage benefits under the previous law will be denied coverage for many services and incur higher out-of-pocket costs. About half will lose Medicare Advantage coverage entirely. Others will stay in Medicare Advantage, but at reduced benefit levels and possibly in different plans that do not meet their needs as well.”
“…half of those who would have chosen MA under prior law either will be unable to enroll in MA plans at all or will no longer find it attractive to do so.”
“…instead of reducing waste, the MA cuts will simply cut health care services available to patients and transfer spending from Medicare Advantage to other federal programs and other payers (including patients), thus increasing federal and state spending on Medicaid and patient spending on Part D, supplemental care plans, and out-of-pocket costs.”
“By 2017, Medicare beneficiaries who would have enrolled in Medicare Advantage under prior law will lose an average of $1,841 due to the MA changes alone and $3,714 when the effects of the entire bill, including the FFS cuts, are considered.”
The effects of the PPACA on Medicare Advantage enrollees will be dramatic and negative. The most obvious effects will be:
Reductions in health care services delivered.
Worse and fewer options for seniors and the disabled.
Fragmentation of care.
Disproportionate harm to low-income and minority beneficiaries.
Higher state and federal Medicaid costs.
Higher prescription drug spending.
- See more at: http://www.ahipcoverage.com/2011/03/22/the-impact-of-the-aca-on-medicare-advantage/#sthash.qJFm45tH.dpuf