The incoming Obama administration and Democratic-led Congress likely will cut payments to private Medicare Advantage plans in 2009, an aide to Senate Democrats said Monday during a briefing sponsored by the journal Health Affairs, CQ HealthBeat reports (Weyl, CQ HealthBeat, 11/24).
According to The Hill, a “longstanding ideological battle between liberals and conservatives over the propriety of turning over a growing portion of the Medicare entitlement to private companies is meeting head-on with the need for Congress to make cuts to certain programs in order to finance other priorities.”
Federal payments to MA plans cost the government $94 billion annually.
Democrats say $15 billion of that amount is excessive and the so-called overpayments could be used for other things, such as overhauling the U.S. health care system, The Hill reports (Young, The Hill, 11/24).
Private MA plans on average are paid an estimated 13% more per beneficiary than what the same beneficiaries would cost in traditional Medicare, according to the Medicare Payment Advisory Commission (CQ HealthBeat, 11/24).
The Democratic aide said, “Further cuts are coming to the program. The payments are so high that they really don’t make any sense right now. There really is no rationale for the level of payments” (The Hill, 11/24).
Democratic staffers already are rethinking the payment system “quite extensively,” the aide said (CQ HealthBeat, 11/24).
