Advantage plan enrollment expected to jump

The Obama administration projected that next year Medicare Advantage enrollment will jump 11% and premiums will rise by nearly 5%.

The expected enrollment increase was touted by HHS Secretary Kathleen Sebelius in a news release as the latest evidence that the program of private insurance plans within Medicare was strengthened by the Patient Protection and Affordable Care Act.

“Since the law was enacted in 2010, average premiums have gone down, enrollment has gone up, and new benefits and lower drug costs continue to help millions of seniors and people with disabilities,” Sebelius said in the release.

The administration downplayed the expected $1.47 increase in the average $31.12 monthly premium as likely higher than the ultimate increase. That is, if beneficiaries select the lower cost plans at the same rate next year that they did in 2012, then the average premium would increase by only 57 cents, according to the administration.

The report is the latest indicating continued growth in the program, despite the warnings of Republicans that the more than $300 billion in cuts to the insurance plans required by the 2010 healthcare overhaul will ultimately eliminate many of the plans and reduce beneficiary's access to them. The administration's new projections maintain that access to such insurers will remain strong, with 99.6% of beneficiaries having access to a plan and the number of plans jumping by 7%.

The pain of such cuts will begin to be felt next year, Republicans have repeatedly said, when most of the bonus payments provided to many Medicare Advantage plans from an $8.3 billion pilot program are expected to end.

“These cuts will significantly alter the program and jeopardize seniors' access to the health plans they rely on,” said Rep. Wally Herger, chairman of the House Ways and Means Health Subcommittee, in a statement this week on a Medicare Advantage hearing his panel will hold Friday.

It was a concern echoed by the nation's largest insurer advocacy group.

“As the payment cuts and new taxes take effect, Medicare health plans will continue to do everything they can to preserve benefits and keep coverage as affordable as possible for the millions of seniors and people with disabilities they serve,” said Karen Ignagni, president and CEO of America's Health Insurance Plans, in a written statement. “However, given the size and scope of these cuts, Medicare beneficiaries are likely to face higher costs and coverage disruptions in the coming years.”