Medicare Advantage plans to see 2011 premium dip
Washington: Elderly Americans enrolled in private Medicare health insurance plans will see their premiums fall slightly in 2011 while gaining more benefits from recently passed health care reforms, U.S. health officials said on Tuesday.
The plans, called Medicare Advantage, are offered by health insurance companies as an alternative to traditional, government fee-for-service Medicare. Rates are expected to be 1 percent lower next year compared to 2010, the Centers for Medicare and Medicaid Services (CMS) said. Enrollment in the plans is also expected to grow 5 percent. More than 11 million seniors are already enrolled in the plans, which have come under fire from critics who say insurers receive lucrative subsidies to provide the plans even though they can offer additional benefits.
Jonathan Blum, director of CMS` Center for Medicare, said the lower costs and projected expansion show companies are still interested in offering such plans despite new consumer protections under the healthcare law and recent payment caps to insurers.
"This is still a very attractive marketplace for Medicare Advantage plans," he told reporters. The news comes as the healthcare reform law, passed in March, hits its six month anniversary this week, triggering a host of changes for insurers overall, such as ending lifetime coverage caps and banning policy cancellations after an enrollee gets sick.
Under the law, Medicare Advantage consumers will see their out-of-pocket expenses limited and a reduction in how much they have to share costs when it comes to kidney dialysis, chemotherapy and other expensive care, Blum said.
CMS said some companies chose to abandon their Medicare Advantage business next year and that about 5 percent of beneficiaries will have to choose a new provider as a result.