CMS announces increase in payments to MA plans

Apr 4, 2007

  1. Cenla Agent
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  2. Frank Stastny
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    Interesting article.

    There is some informtaion in the press release that I think is very telling about the possible future of Advantage plans.

    "The program was designed to expand Medicare and better manage costs, though recent statistics show the government spends more on patients in Medicare Advantage plans than those in traditional Medicare.

    "The government's announcement should particularly benefit Louisville, Ky.-based Humana Inc., which makes nearly half its earnings through the Medicare Advantage program. Wachovia Securities analyst Matt Perry reaffirmed an "outperform" rating for the stock, saying the payment update "bodes well for Humana shares".

    Shove said the Medicare Advantage plans remain "a high risk business with a large congressional target on its back," as Democrats in the House of Representatives look at cutting payments to the program to fund other priorities.


    Rep. Pete Stark, D-Calif., held a hearing last month looking at whether Medicare Advantage providers are overpaid after a nonpartisan advisory group reported that the government spends 12 percent more to insure beneficiaries in Medicare Advantage plans compared with traditional Medicare."

    All of this could lead to the demise of Advantage plans or at the very least we could see the monthly cost to consumers increase dramatically in the next few years. Medicare Supplement policies may be around for a lot longer than we think.

    Sounds like Humana has a very strong lobbying effort.
     
  3. Slick
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    The only thing I see in that article is another Democrat that wants to see the government lose money vs. the private sector make money.
     
    Slick, Apr 5, 2007
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  4. Cenla Agent
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    Humana as well as many of the other companies no doubt have a very strong lobbying force. Humana has other business besides MA that is dependent on government contracts, like Tricare and contracts with state governments to offer state employees choices in health coverage.

    I've never heard anyone say that Medicare Supplement policies are going away although I suppose some overenthusiastic MA advocates may have argued that they are obsolete, too expensive, etc. But I think they are still the best option out there for many people, especially those with higher incomes that can afford to keep up with the inevitable premium increases.

    Basically I posted the link because based on the news, the MA market will probably hold steady for the time being. But I figure all bets are off if a Dem. gets elected President in 2008.
     
  5. Slick
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    If Hillary gets elected I'll have a lot more to worry about than just MA plans.
     
    Slick, Apr 5, 2007
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  6. Cenla Agent
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    Sure. But it would probably be the same with Obama or Edwards as well.

    Based on this story, my guess is that no big changes will be made to MA before 2010 at the earliest.
     
  7. Frank Stastny
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    I'm glad to hear that you also don't think that Advantage are the end all, be all for the senior market. Like anything else, they have their place but I don't believe that they are for all seniors.

    I have heard a lot of agents I know say that "everyone should be on an Advantage plan". They may very well be right. :)

    I'm scared to death about the next election. We all may be selling insurance in Australia. LOL
     
  8. Cenla Agent
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    That could be. People keep saying Hillary Hillary Hillary. But any Dem. being elected could spell trouble for MA certainly, and any of them would likely attempt to implement some kind of universal health care. Actually Obama is more liberal than Hillary. My understanding is that his record is the most liberal in the Senate and that includes Ted Kennedy.
     
  9. sman
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    Actually, Dick Durbin is the most liberal according to the National Journal. There were 9 Senators more liberal than Mr. Obama. Not that this makes him any better. But he is more liberal than Hillary and that's just plain scary. Here's a link

    http://nationaljournal.com/voteratings/sen/lib_cons.htm?o1=lib_composite&o2=desc
     
    sman, Apr 7, 2007
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  10. GreenSky
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    I'm confused about this subject. About 10 days ago I read that it costs Medicare 13% more for someone in an MA plan. Now all MA plans get an increase for 2008.

    The real answer to get the government out of the insurance business - and I mean 100% out. Medicare never was viable and sill is not viable.

    Much like social security, it is a Ponzi Scheme. (If you are confused as to why social security is a Ponzi Scheme, look at http://www.hoover.org/publications/digest/3512061.html)

    Rick

    (Am I the only libertarian on this board?)
     
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