CMS Proposes Medicare Advantage Cuts

Medicare is proposing a small cut in Medicare Advantage rates for 2015, less than half of what private insurers were expecting from the federal agency. The final rule will be released April 7.

The CMS based its projections (PDF), which will differ across the country based on a variety of factors, on an expected 3.55% decline in the Medicare Advantage growth rate factor and an expected decline of 1.65% in per capita expenditures in the fee-for-service portion of the senior citizen healthcare program. More than 15 million or 30% of all Medicare beneficiaries are currently in Medicare Advantage plans offered by private insurers. The CMS estimates that the blended rate of per capita spending for Medicare Advantage beneficiaries will decline by 1.9% in 2015.

“This historically low growth in Medicare per-capita spending is tied, in part, to successful initiatives undertaken to promote value over volume and help curb fraud, waste and abuse in the Medicare fee-for-service program in recent years,” the agency said in a press release.

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Source: Modern Healthcare