Decoding The High-Stakes Debate Over Medicare Advantage Cuts

Published Online: April 07, 2014

Health insurers often try to influence Washington through quiet persuasion in plush offices. To fight potential government cuts for private Medicare plans, however, they’ve hit the streets.

The Obama administration has proposed reducing what insurers collect for Medicare Advantage plans — HMOs and PPOs, mainly — that cover about 15 million seniors. (Regular Medicare, which still covers most seniors, pays doctors and hospitals directly.)

The rate change, part of the Affordable Care Act, is the next step in winding down a subsidy that pays Medicare Advantage plans substantially more than what traditional Medicare costs. Proponents say the move will end what they call an industry windfall and pressure insurers, hospitals and doctors to deliver care more efficiently.

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Source: Kaiser Health News