Consumer / Employer, Payers

Insurer Advocacy Orgs Slam Final MA, Part D Rate Announcement

America’s Health Insurance Plans, the Better Medicare Alliance and the Association for Community Affiliated Plans all came out against CMS’ final 2025 Medicare Advantage and Part D rate announcement.

Health insurer advocacy organizations are disappointed after the Centers for Medicare and Medicaid Services (CMS) released the final 2025 Medicare Advantage and Part D rate announcement on Monday.

CMS said it expects total MA revenues to increase by 3.7%, or $16 billion, in 2025. The government is anticipated to pay $500 to $600 billion in Medicare Advantage payments to private health plans in 2025. Benchmark payments to MA plans, however, will decrease by 0.16% for 2025. The benchmark is “the maximum amount the federal government will pay plans for an average person in each county,” according to the Commonwealth Fund.

AHIP President and CEO Mike Tuffin claims the changes will hurt Medicare Advantage beneficiaries.

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“These policies will put even more pressure on the benefits and premiums of 33 million Medicare Advantage beneficiaries who will be renewing their coverage this fall,” he said in a statement. “It is important to note that the Medicare Advantage and Part D programs are already undergoing a number of significant regulatory and legislative changes. Moreover, the cost of caring for Medicare Advantage beneficiaries is steadily rising.”

Mary Beth Donahue, Better Medicare Alliance president and CEO, said the final rate notice doesn’t address the worries of “influential bipartisan Members of Congress, thousands of Medicare Advantage beneficiaries, and more than one hundred organizations serving beneficiaries.”

“Left unaddressed, CMS’ Final Rate Notice risks the stability of the affordable and dependable care more than 32 million Medicare Advantage beneficiaries rely on, especially those with lower incomes and from diverse communities, who may experience disruption to their benefits or premiums in the fall of 2024 when they choose their Medicare coverage,” she said.

Like Tuffin, she added that the final rate notice comes as the Medicare Advantage program faces numerous policy changes. For example, the Inflation Reduction Act made modifications to the Part D program, including making insulin available at $35/month per covered prescription and a yearly cap on out-of-pocket prescription drug costs in Medicare.

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The Association for Community Affiliated Plans’ concerns are two-fold, according to Margaret A. Murray, CEO of the organization.

“First, the assumptions CMS used to inform the Part C rate components don’t sufficiently take into account the increased utilization associated with high-need, high-risk Medicare beneficiaries served by Safety Net Health Plans,” Murray said in a statement. “Second, with respect to Part D, we are concerned that the adjustments to the Part D risk adjustment model understate the true cost of the highest need dually eligible individuals enrolled in fully-integrated and highly-integrated D-SNPs offered by Safety Net Health Plans.”

While insurers are upset by the rate announcement, CMS Administrator Chiquita Brooks-LaSure said the changes “will make improvements to keep Medicare Advantage payments up-to-date and accurate, lower prescription drug costs, and ensure that people with Medicare have access to robust and affordable health care options.”

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