Today the Kaiser Family Foundation (KFF) reported that the number and percentage of Medicare beneficiaries enrolling in Medicare Advantage plans continues to grow. The new growth statistic for the private Medicare health plans comes despite concerns that payment changes enacted in the Affordable Care Act of 2010 (ACA) would lead to reductions.
Reductions in payments enacted in the ACA aimed to reduce historical overpayments to Medicare Advantage plans and to create more equity between Medicare payments made for beneficiaries in the traditional Medicare program and those joining Medicare Advantage plans. As of March of 2014, almost one in three (30 percent) people on Medicare (15.7 million beneficiaries) were enrolled in a Medicare Advantage plan, a 10 percent increase since March 2013. During the past year, Medicare Advantage enrollment has increased in virtually all states. Most of the enrollment growth since 2013 has been in the individual market, but group enrollment in Medicare Advantage plans accounted for almost one-third (32%) of the enrollment growth in 2014 and has been a major factor in the experience of some firms.
The KFF report also states that the average monthly premiums have remained stable since 2012. They point out, however, that the average out-of-pocket spending limits are on the rise, and suggest that this could subject some enrollees to higher medical costs.
Unlike Original Medicare, all Medicare Advantage health plans must cap maximum out-of-pocket (MOOP) costs for services covered under Medicare Parts A and B. The CMS recommended MOOP in 2014 is $3,400, and the maximum is $6,700. In 2014, the number of Medicare Advantage enrollees in plans with a MOOP above $5,000 nearly doubled (24 percent in 2013 to 44 percent in 2014).