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Medicare Advantage Enrollment Grows, Premiums Shrink

Cheryl Clark, for HealthLeaders Media, February 2, 2012

Medicare Advantage plans are having tremendous success, with reduction in premiums amounting to 7%, an expansion of choices, and a 10% increase in enrollment from a year ago, U.S. Health and Human Services Secretary Kathleen Sebelius boasted on Wednesday.

But the administration's claims were tempered moments earlier when officials from America's Health Insurance Plans warned that enrollment is expected to dramatically decline hereafter, from 11.7 million in 2011 to 7.5 million in 2018, and 7.8 million in 2019, according to an analysis from the Congressional Budget Office. That's because of $200 million in cuts, legislated by language in the Patient Protection and Affordable Care Act.

"As those cuts go into effect, plans will not be able to continue offering the same level of coverage they offer today and, in some markets, may have to stop offering coverage altogether," said AHIP spokesman Robert Zirkelbach in e-mail. "This is what happened last time the program was cut dramatically." 

Sebelius said those concerns have been heard. "Now, many people raise fears over and over again that under the Affordable Care Act, beneficiaries would see their Medicare Advantage options shrink and their premiums rise. Instead, we are seeing just the opposite. For the 48 million Americans who count on Medicare, this program is strong and getting stronger in 2012."

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