April 07,2014

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Aaron Fobes/Julia Lawless (202) 224-4515

Hatch On CMS Decision to Scale Back Proposed Medicare Advantage Cuts

WASHINGTON - U.S. Senator Orrin Hatch (R-Utah), Ranking Member of the Senate Finance Committee, today issued the following statement after the Centers for Medicare and Medicaid Services’ (CMS) announced its decision to pare back previously proposed cuts to the market-driven Medicare Advantage (MA) program:

 “Seniors enrolled in Medicare Advantage continue to suffer from the more than $300 billion in severe cuts used to fund ObamaCare. Although CMS has scaled back some of the new proposed cuts, much more work needs to be done to protect our seniors.”

Additional Background:
The MA program, which provides coverage for almost 15 million seniors, allows beneficiaries to gain access to quality and comprehensive private insurance plans that include additional benefits like vision care, dental care, and care coordination.

The Patient Protection and Affordable Care Act (PPACA) cut more than $300 billion from the MA program to fund new entitlement spending. In February 2014, CMS released its MA 2015 rate notice to further cut this popular health care program.

Hatch has championed efforts in Washington to prevent the proposed cuts from taking place, spearheading multiple efforts, warning that the cuts would limit choices and access for beneficiaries.

A February 2014 study by Oliver Wyman on the proposed changes to Medicare Advantage’s payment methodology found the following:

• Medicare Advantage plans would see a 5.9 percent reduction in payment in 2015.

• Between 2014 and 2015, Medicare Advantage plans would face 9.9 percent to 11.9 percent in reductions.

• These cuts mean seniors who rely on this critical program could see their benefits reduced and premiums increased between $65 to $145 a month over the next two years.

• Low income beneficiaries are disproportionately affected; 41 percent of MA enrollees have incomes below $20,000.