Press Release             

Contact: Paul Precht
Director of Policy and Communications

Akiko Takano
Deputy Director of Communications

October 2, 2009

Statement by Medicare Rights Center President Joseph Baker on the Medicare Private Health Plans Offered for 2010

New York, NY—The Obama administration has taken important steps towards simplifying the choice of private Medicare Advantage health plans facing consumers by requiring insurers to consolidate plans that have duplicative benefit designs or very low enrollment. The administration has also pushed insurers to provide a reasonable out-of-pocket limit for all Medicare-covered services, and it appears that in most parts of the country, consumers will have a choice of plans that offer this important protection. Providing a manageable number of high-quality health plans that provide real choice among benefits and costs is the best way to ensure people with Medicare can choose a plan that best meets their needs. We look forward to working with Congress and the administration to further strengthen consumer protections under the Medicare Advantage program.

As in past years, some Medicare Advantage plans are raising premiums and scaling back benefits. We advise Medicare Advantage enrollees to carefully review their 2010 benefits to ensure the plan still meets their needs. This is the first year, however, that the insurance lobby is publicizing companies’ decisions to hike premiums or reduce benefits. Companies are blaming those decisions on the payment reductions scheduled for 2010 that are the result of the current statutory payment formula, and warning that further benefit cuts will follow if Congress acts to rein in the excessive subsidies insurers receive. But even a cursory review of 2010 data shows that not all companies have chosen to raise premiums, even as they maintain protections for enrollees with high medical bills. These private companies, not the government, decide how much they will allocate to benefits and how much they will spend on agent commissions, administrative overhead or keep as profits. It is worth noting that HR 3200, while reducing the subsidies for insurance companies, also sets a new floor for how much they spend on medical care for people with Medicare, helping to ensure that premium dollars are spent on health care for Medicare members.

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Medicare Rights Center is a national, nonprofit consumer service organization that works to ensure access to affordable health care for older adults and people with disabilities through counseling and advocacy, educational programs, and public policy initiatives.


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