• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
  • Skip to footer
  • Donate Now
  • Sign Up

Center for Medicare Advocacy

Advancing Access to Medicare and Healthcare

  • Eligibility/Enrollment
  • Coverage/Appeals
    • Medicare Costs (2021)
    • Self Help Materials – Toolkits & More
  • Topics
    • Basic Introduction to Medicare
    • COVID-19 and Medicare
    • Medicare Costs (2021)
    • Home Health Care
    • Improvement Standard and Jimmo News
    • Nursing Home / Skilled Nursing Facility Care
    • Outpatient Observation Status
    • Part B
    • Part D / Prescription Drug Benefits
    • Medicare for People Under 65
    • Medicare “Reform”
    • All Other Topics
    • Resources
      • Infographics
  • Publications
    • CMA Alerts
    • Fact Sheets & Issue Briefs
    • Infographics
    • The Medicare Handbook
    • SNF Enforcement Newsletter
    • Elder Justice Newsletter
    • Medicare Facts & Fiction
    • Articles by Topic
  • Litigation
    • Litigation News
    • Cases
    • Litigation Archive
    • Amicus Curiae Activities
  • Newsroom
    • Press Releases
    • Editorials & Letters to the Editor
    • CMA Comments, Responses, and Letters
    • Medicare Facts & Fiction
    • CMA in the News
  • About Us
    • Mission Statement
    • CMA FAQs
    • Annual Report
    • Personnel & Boards
    • The Center for Medicare Advocacy Founder’s Circle
    • Connecticut Dually Eligible Appeals Project
    • Ossen Medicare Outreach, Education and Advocacy Project
    • National Medicare Advocates Alliance
    • National Voices of Medicare Summit
    • CMA Webinars
    • Products & Services
    • Testimonials
    • Career, Fellowship & Internship Opportunities
    • Contact Us
  • Support Our Work
    • Donate Now
    • Join the Center for Medicare Advocacy Founder’s Circle
    • Take Action
    • Share Your Health Care Story
    • Tell Congress to Protect Our Care
    • Listen to Medicare & Health Care Stories
    • Sign Up

CBO Estimates $170 Billion in Savings by Equalizing Medicare Advantage Payments with Traditional Medicare Fee-for-Service

March 3, 2010

Print Friendly, PDF & Email

CBO ESTIMATES $170 BILLION IN SAVINGS BY EQUALIZING MEDICARE ADVANTAGE PAYMENTS WITH TRADITIONAL MEDICARE FEE-FOR SERVICE
 

WASHINGTON, DC – On March 1, 2010, the Medicare Advisory Payment Commission (MedPAC) released its biannual report to Congress, which for the fifth consecutive year advised Congress to equalize reimbursements to Medicare Advantage plans with the traditional Medicare fee-for-service program.  These recommendations were incorporated in the House-passed health care reform bill, the Affordable Health Care for America Act (H.R. 3962).  According to non-partisan Congressional Budget Office (CBO) estimates, equalizing payments between Medicare Advantage programs and the traditional Medicare programs will generate $170 billion in savings over the next ten years. 

"I applaud the non-partisan MedPAC report, which provides an intelligent path towards strengthening Medicare for seniors. This report is not just a debating point, but is central to protecting and preserving this important health insurance program for seniors," stated Representative Joe Courtney (D-CT).  "The Trustees of Medicare have warned the country that overpayment to the Medicare Advantage program is one of the major cost drivers pushing Medicare to its 2017 negative cash flow. Following MedPAC's recommendations will extend the solvency of Medicare for all seniors and can be done in a way to allow Medicare Advantage to continue to be a choice for those who prefer it to traditional Medicare."

MedPAC's report concluded that the "Commission has consistently supported the concept of financial neutrality between payment rates for the fee-for-service program and private plans."  Under the current reimbursement system, Medicare Advantage plans are reimbursed on average 14 percent more than traditional Medicare plans. 

"Once again, the independent Medicare Payment Advisory Commission reports that all Medicare beneficiaries have to pay higher premiums because of the continuing over-payments to private insurance companies through the Medicare Advantage program," stated Judy Stein, Executive Director, Center for Medicare Advocacy, Inc.  "The healthcare reform bills passed by both the House and the Senate, and the proposals by President Obama, would reduce this wasteful spending – saving money for Medicare beneficiaries and taxpayers alike, and extending the solvency of the Medicare program."

These extra costs are born by beneficiaries in the traditional Medicare program and all taxpayers.  The report went on to conclude that the Part B premium was $3.35 per month higher in 2009 than it would have been if reimbursements were equalized.

MedPAC was established under the Balanced Budget Act of 1997 as an independent, non-partisan Congressional agency to advise Congress on issues affecting Medicare.  Every year, MedPAC issues recommendations on Medicare policy changes in biannual reports to Congress.

Filed Under: Press Release

Primary Sidebar

Easy Access to Understanding Medicare

The Center for Medicare Advocacy produces a range of informative materials on Medicare-related topics. Check them out:

  • Medicare Basics
  • CMA Alerts
  • CMA Webinars
  • Connecticut Info & Projects
  • Health Care Stories
  • Se habla Español

Sign Up for CMA Alerts

Jimmo v. Sebelius

Medicare covers skilled care to maintain or slow decline as well as to improve.

Improvement Isn’t Required. It’s the law!

Read more.

Medicare: Build Back Better

By prioritizing Medicare beneficiaries and the health systems that serve them, we can avoid drastic national consequences. The Center for Medicare Advocacy proposes a five-part plan that will make Medicare a bulwark against the worsening health and economic challenges facing the American people.

Learn more.

Latest Tweets

  • Special thanks from @CMAorg to @PowersLawFirm for the many years of ongoing support and for sponsoring our recent N… https://t.co/8z36yJHyQd, 12 hours ago
@CMAorg

Footer

Stay Connected:

  • Contact Us
  • Sitemap
  • Products & Services
  • Copyright/Privacy

© 2021 · Center for Medicare Advocacy