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Medicare Compliance & Reimbursement

Managed Care:

Thanks, Taxpayers! What Health Plans Are Doing With Their Extra Medicare Pay

Published on Thu Mar 18, 2004

Plans creating larger networks, lowering premiums.

Want to know how the playing field is shaping up for Medicare Advantage plans post-reform? A Feb. 27 review by the Centers for Medicare & Medicaid Services reveals that average premiums will shrink about $11 dollars (from $42.40 to $31.44) for millions of enrollees, while beneficiaires covered under some type of prescription drug benefit will rise a notch to 80 percent.
 
According to the amended adjusted community rate proposals sent to CMS, here's how plans decided to share the extra money they'll receive under last year's Medicare reforms:

  • 42 percent of additional funds is being used to expand enrollees' choices of physicians, specialists and other health care providers;
  • 31 percent to reduce premiums;
  • 17 percent to enhance existing benefits, including additional support in making Medicare prescription drug discount cards available;
  • 5 percent to reduce cost sharing and co-payments
  • 5 percent to support stabilization funds that have to be used by the end of 2005 to help beneficiaries.

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