New York Estate Planning & Elder Law Blog
When open enrollment begins for Medicare, many seniors across the country will notice an expanded range of health care plan options, including those offered by private insurance companies through Medicare Advantage. With more Americans than ever considering and signing up for these Medicare alternatives, more insurance companies than usual are selling more Medicare Advantage plans for 2019, some offering lower or no premiums and improved benefits.
According to the Centers for Medicare and Medicaid Studies (CMS), an additional 14 new insurance companies will sell 3,700 plans for 2019, an estimated 600 more than offered to beneficiaries in 2018. CMS estimates that total enrollment for Medicare Advantage plans will grow to 23 million people in 2019, a 12 percent increase over the previous year and may grow to serve one-third of all Medicare enrollees in the next decade.
Medicare Advantage plans have been attractive to seniors due to the extra benefits these types of coverage options offer. Many of these private insurance plans can save seniors money because premiums, deductibles, and additional costs are lower than what beneficiaries pay with original Medicare offered by the federal government. One of the main downsides to Medicare Advantage Plans is that they require enrollees to seek care within a restricted network of health care providers.
The enthusiast by insurance companies to operate Medicare Advantage plans in additional counties and states comes despite massive cuts to the programs after the Affordable Care Act of 2010 (ACA) in the billions of dollars. Lawmakers originally targeted the program for cuts because some studies had show enrollees in these plans ende dup costing the federal government more than traditional Medicare beneficiaries. Despite that, health insurance companies have been able to turn a profit and make up for these financial setbacks by accruing bonuses by identifying illnesses and health risks of members that would entitle the companies to federal “risk-adjustment” payments.
Some experts studying the healthcare industry believe insurance companies offering Medicare Advantage plans could turn even higher profits after the White House announced it would boost payments to these plans by 3.4 percent for 2019, 0.45 percentage points higher than the 2018 increase. Companies believe there is even more room to grow by tapping into underserved markets and those who already have Medicare but may be willing to switch over to or supplement their existing health care plan.