To rephrase an old aphorism, there are lies, damned lies and government figures on Medicare Advantage plan enrollment. And each of them can be misleading if the underlying assumptions aren’t challenged. A new Kaiser Family Foundation (KFF) study confirms, with the aid of CMS data, the strong recent growth in MA membership — which now totals about 14.4 million — virtually across the board. The study raises no doubts that the trend will continue during the remainder of 2013 and even 2014, but it’s a different story for 2015 and beyond.
The outlook for MA plan enrollment in 2015 and beyond “is not entirely clear,” understated study co-author Gretchen Jacobson, associate director, Program on Medicare Policy, at a June 10 Alliance for Health Reform briefing on the future of MA at which the study was released. And even MA optimist Carl McDonald, a well-regarded securities analyst at Citigroup Global Markets who was another panelist at the briefing, said the recent Congressional Budget Office projection of about 50% MA enrollment growth between now and fiscal year 2023 may be “too optimistic.”
CBO, as McDonald pointed out, didn’t explain the assumptions behind its May 14 enrollment forecast. It may simply have assumed that the continued influx of people “aging into” Medicare plus the trend of improving CMS star quality ratings, which translate into higher bonuses for MA plans that can be used to lower premiums and/or boost benefits, will be enough to keep membership figures growing. But this doesn’t take into account the facts that bonuses starting in 2015 will go only to plans earning four stars or better and that MA plan payments will decline because of such factors as Affordable Care Act provisions and CMS risk-adjustment methodology changes. It’s “hard to find” a reason for plans to keep the current low levels of enrollee cost sharing given by the MA payment-rate outlook, said another panelist, Alissa Fox, senior vice president at the Blue Cross and Blue Shield Association.
What do you think will happen to MA enrollment in 2014, 2015 and beyond? Will it keep rising, even though payment rates will be shrinking, because of plans’ efficiency versus fee-for-service Medicare plus a steady diet of age-ins? Or is there a wall looming around the next bend that MA plans will run into even if they keep their eyes on the ball?
http://aishealth.com/blog/medicare-advantage-and-part-d/will-they-still-love-ma-plans-tomorrow-enrollment-figures-may
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