February 19, 2014

Bipartisan Group Of Senators Object To Additional Cuts To Medicare Advantage

Crapo, Schumer lead letter to CMS expressing concern over a decrease in payments

Washington, D.C. - A bipartisan coalition of forty senators, led by Mike Crapo (R-Idaho) and Charles Schumer (D-New York), have written the Centers for Medicare and Medicaid Services (CMS) to express concern with additional cuts to Medicare Advantage in 2015. 

In the letter, the senators state, "We are strongly committed to preserving the high quality health plan choices and benefits that our constituents receive through the Medicare Advantage (MA) program.  Given the impact that payment policies could have on our constituents, we ask that you prioritize beneficiaries' experience and minimize disruption in maintaining payment levels for 2015.  Approximately 15 million seniors and individuals with disabilities-accounting for 28 percent of all Medicare beneficiaries-are currently enrolled in MA plans, which tend to offer more flexible services and benefits than traditional Medicare."

"In rural areas, such as much of Idaho, MA plans are a significant part of the insurance coverage network for Medicare patients," said Crapo.  "MA plans have already received significant reductions due to the president's health care law, leading some providers to cancel plans.  Like all health care consumers, beneficiaries are looking for consistency and predictability to ensure continued access to high quality health care.  MA has been a successful competitive option for Idaho seniors, and it should continue without further reductions."

CMS proposed in early 2013 a further 2.3 percent reduction in MA payments.  Last year, Crapo and Schumer contacted CMS opposing the proposal, which was later replaced with a 3.3 percent growth factor increase in the final rule.  However, despite the positive growth rate included in the final rule, the payment cuts and new health insurance tax included in the president's health care law, combined with other changes outlined in the final rate notice, resulted in MA plans facing a decrease in payments of approximately 6 percent in 2014.

Over the next two years, about $45.5 billion of the president's health care law cuts to MA will go into effect.  These cuts, along with additional proposed cuts from CMS, could result in MA plans being cancelled for seniors across the country.                                                                                                                                

The full text of the letter is attached.