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Cuts expected to subsidies for private Medicare plans

Wall Street Journal, April 6, 2009

The government is expected to set in stone the 2010 rates it will pay health insurers to run private Medicare plans. Most signs suggest that cuts are coming in the subsidies that the industry got during the Bush administration. Stocks of health insurers were sucked into a surprise tailspin in February after Medicare officials signaled they planned an effective 5% cut in those payments after formula adjustments. Insurers, medical societies and others have had six weeks to give regulators their arguments before the payment rates become final for next year.