The Centers for Medicare and Medicaid Services (CMS) may let Medicare Advantage carriers charge a little more in 2012, but the increase likely will be lower than the medical inflation rate, according to an analyst at Standard & Poor’s Ratings Services.
The Medicare Advantage program gives private health carriers a chance to provide Medicare plans.
Program defenders say the program gives participants much richer benefits with much lower out-of-pocket costs; critics contend that the program has ended up costing more per enrollee than the traditional Medicare fee-for-service program.
Steve Zaharuk, a senior vice president at S&P, New York, notes in a commentary that CMS has adopted a complicated 2012 Medicare Advantage payment formula that likely will increase typical rates by about 1%.
What Your Peers Are Reading
S&P analysts have been expected CMS to cut 2012 rates by about 2% to 3%, Zaharuk says.
“Nevertheless, these rates still create a number of challenges for health insurers,” Zaharuk says.