Analysis: ACA Will Cut Medicare Advantage by $1,500 per Senior in '15

Thursday, 17 Apr 2014 06:45 PM

By Cathy Burke

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Obamacare cuts to the popular Medicare Advantage program for seniors will lead to benefit reductions of about $1,500 per enrollee next year, an analysis by conservative think tank American Action Forum showed Thursday.

Roughly 30 percent of Medicare beneficiaries — about 16 million seniors — use the privately administered Medicare Advantage plans, and the program continues to draw beneficiaries despite Obamacare cuts, the National Journal reported.

The federal Medicare agency recently backed off a proposal to make additional cuts to Medicare Advantage.

But according to the study by AAF, which was founded by former Congressional Budget Office head Douglas Holtz-Eakin, mandated reductions by Obamacare will still hit benefits for most seniors who use the Advantage program.

"Overall, the cuts average about $317, or 3.07 percent, per Medicare Advantage enrollee compared to the rates in effect for 2014," the analysis said, adding, however, "after a series of annual cuts… enrollees in the next year will face a benefits reduction of about $1,538, or 13.32 percent, below the level projected for 2015" in a pre-Obamacare baseline.

The analysis noted "substantial variation geographically," with some states, such as Alaska, figuring to see slight increases in payments to their Advantage plans while others, including Louisiana, face higher-than-average reductions.

"Measured in dollars, the cuts range from $500 per year in South Dakota to $2,857 in Louisiana, with a national average of $1,538," the analysis noted.

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