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Continued: Insurance industry spends millions fighting cuts to Medicare Advantage

  • Article by: JIM SPENCER , Star Tribune
  • Last update: April 6, 2014 - 9:35 PM

The company has not canceled any Medicare Advantage plans because of the reimbursement cuts, spokesman Terry O’Hara said, but by the end of 2014 its provider network will be 10 to 15 percent smaller than it was in January 2013.

United’s reported removal of 2,200 physicians in its Connecticut network sparked the most controversy. Several hundred of those doctors sued, and a federal judge temporarily stopped their exclusion to give arbitrators a chance to rule on their status.

Patients whose regular physicians were forced out have complained. But their gripes have been as much with United as the government.

UnitedHealth and other health insurers, along with their trade associations, have spent millions of dollars lobbying against reimbursement reductions since cuts were included in the Affordable Care Act of 2010.

Insurance industry officials maintain that Medicare Advantage cuts of $200 billion from 2011 to 2017 built into the health care law will cause providers to abandon the program, leaving seniors with fewer choices unless regulators offset the cuts.

The Centers for Medicare and Medicaid Services — known as CMS — “have broad discretion,” Zirkelbach said. They can neutralize Medicare Advantage cuts administratively by doing such things as not canceling payment incentives for high quality plans, nixing announced changes in medical coding that would lower payments and continuing to allow in-home diagnoses of patients that can raise reimbursements to companies insuring those with major health problems.

Cuts defended

CMS says its proposed changes will not hurt seniors or insurance companies.

“The proposed changes for 2015 for Medicare Advantage are smaller than those implemented in 2014,” a spokesman said. “We believe that beneficiaries will have a wide array of high-quality, low-cost options in 2015 while we make certain that plans are providing value to Medicare and taxpayers.”

As the lobbying continues, politicians in Minnesota have said they don’t want any cuts to hurt seniors. Both of the state’s U.S. senators — Democrats Amy Klobuchar and Al Franken — and five of its eight representatives — Republicans Erik Paulsen and John Kline and Democrats Keith Ellison, Betty McCollum and Collin Peterson — have signed letters to federal officials.

“I voted to stop the overpayments and make the program run more efficiently.” said Franken, who with Klobuchar voted for the Affordable Care Act. “I’ve kept a close eye on this, and for the last two years I’ve written to CMS to ask them to prioritize seniors when setting their policies.”

Klobuchar pointed to a 30 percent growth in enrollment since 2011 as a sign that the program has not been hurt by health reform.


Jim Spencer • 202-383-6123

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  • March 7, 2014: Don and Elizabeth Dersch of Chester, Va., chose Medicare Advantage, a private plan, over traditional Medicare when they both became eligible. The government is now reducing what it pays private plans.

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