Medicare private plan enrollment hits 12.8 million

By CHARLES FIEGL, Amednews staff. Posted Feb. 13, 2012.

Washington — Enrollment in private Medicare plans increased by 10% as average plan premiums have fallen by 7%, but health insurers are warning that patients will have fewer private coverage choices after insurance market mandates in the health system reform law take effect.

Recent federal data show 12.8 million patients, or 25% of the Medicare population, enrolled in a Medicare Advantage plan for 2012. The average monthly premium for these plans dropped to $31.54, from $33.97 in 2011.

“Not only are average premiums lower, but plans are better, with more beneficiaries enrolled in four- and five-star plans,” Centers for Medicare & Medicaid Services Administrator Marilyn Tavenner said on Feb. 1. “The Affordable Care Act has strengthened Medicare Advantage by motivating plans to improve the quality of their coverage.”

The reform law had introduced new quality scores and bonus payments for plans that meet performance standards. But those bonuses are temporary, and other reform law provisions that will lower federal subsidies to Medicare Advantage plans have yet to take effect. That has insurance plans worried.

The 2010 health system reform law eventually will cut a total of $200 billion from Medicare Advantage during the next several years, said Robert Zirkelbach, a spokesman for America’s Health Insurance Plans. As a result, the Congressional Budget Office projects enrollment in these plans to drop by 4 million by 2019. This will lead to higher premiums for patients who remain in private plans, Zirkelbach said. Read Full Article