NU Online News Service, Feb. 4, 2004, 5:39 p.m. EST, Washington – The head of the AAHP-HIAA likes the new Medicare reform legislation.[@@]

The reform section of the Medicare Prescription Drug, Improvement and Modernization Act of 2003 will produce better benefits, lower premiums and expanded choices for beneficiaries participating in the Medicare Advantage program, AAHP-HIAA President Karen Ignagni said today at a press briefing.

A quick survey by AAHP-HIAA found that, despite the fact that the new Medicare Advantage funding rates were released only 2 weeks ago, AAHP-HIAA members already are planning to use the funding to cut prices and enhance coverage, Ignagni said.

Health plans have been reducing Medicare managed care service areas for 5 years, but 81% of the surviving Medicare Advantage plans now say they expect to increase enrollment in 2004.

“This is a strong sign of confidence in the direction of Medicare reform,” Ignagni said.

Some other survey results:

- More than 75% of Medicare Advantage plans expect to strengthen and broaden their provider networks.

- Health plans that cover 93% of all Medicare Advantage beneficiaries expect to use the new funding to lower monthly premiums.

- Plans that cover 60% of beneficiaries say they will improve existing benefits or add benefits such as prescription drug coverage, preventive screening coverage and disease management programs.

- Plans that cover 80% of beneficiaries say they will reduce co-payments and deductibles.

MPDIMA “lays a solid foundation for a private-sector option under Medicare,” Ignagni said.

Although carriers cannot change the effects of 6 years of underfunding overnight, Congress will see tangible benefits from the legislation, Ignagni predicted.

Turning to the Bush administration’s fiscal year 2005 budget, Ignagni praised the administration for focusing on the issue of the uninsured through initiatives such as providing tax credits for the purchase of insurance.

In 2003, Ignagni noted, few observers thought that Congress could enact Medicare reform, but Congress succeeded at enacting Medicare reform.

This year, Ignagni said, she is hoping something similar can happen for the uninsured.

“We will be working on a bipartisan basis to make it happen,” she said.