Defying GOP Predictions, CMS Predicts Seniors Will Retain Access To Medicare Advantage In 2011

In what is one of the few items of good news for health care reform advocates, HHS Secretary Kathleen Sebelius announced this morning that “despite projections of gloom and doom,” virtually all of the 11 million seniors enrolled in the Medicare Advantage will retain access to the program. On average, seniors will pay 1% or $0.45 cents less in premiums, than they did in 2010, Sebelius said on a conference call with health reporters that the Wonk Room attended:

SEBELIUS: For 2011, Medicare beneficiaries will be able to participate in a more robust Medicare Advantage and prescription drug program. As a result of the Affordable Care Act, they’ll benefit from stronger oversight and management by out Centers for Medicare and Medicaid Services. Despite last year’s projections of gloom and doom… virtually all Medicare beneficiaries will be able to chose among Medicare Advantage plans…Average premiums are expected to be lower in 2011 than in 2010, 1% lower. […]

Under the new authority provided by the Affordable Care Act, CMS negotiated with plans to improve benefits and to make sure seniors costs were low. For example, all Medicare Advantage plans will offer an annual out of pocket limit on cost sharing….The health plans participating in Medicare expect enrollment to actually grow in 2011… Medicare Advantage enrollment is expected to grow by about 5%.

Indeed, throughout the reform process, Republicans repeatedly warned seniors that health reform’s cuts to the Medicare Advantage program would chase plans out of the market, leaving seniors without a choice of private coverage. The GOP introduced numerous amendments and motions instructing Congress to remove the $136 billion in cuts to the Medicare Advantage program and Sen. John McCain (R-AZ) famously urged senior citizens to rip up their AARP cards in protest of the organization’s support for the the legislation.


But CMS projects that 99.7% of seniors will continue to have access to a Medicare Advantage plan and that only a small number of fee-for-service plans will leave the market. CMS Administrator Don Berwick attributed their departure to a 2008 bipartisan bill that required issuers to establish provider networks. Their departure will leave some 2,3000 beneficiaries in Colorado and Utah without a Medicare Advantage option.

The government also estimates that as a result of CMS negotiation, “plans improved their benefits by $13 per member per month (5 percent) on average,” resulting in savings of “about $155 per member per year for the 966,000 beneficiaries enrolled in these plans.”

Last month, CMS announced that most seniors will pay about the same for prescription premiums in 2011, while those with the highest costs will pay less — further defying GOP predictions.